SCHENECTADY COUNTY — Hard times flow downhill, to paraphrase an old plumbing maxim, and Schenectady County may have to cut programs it has traditionally helped now that a financial squeeze is on.

The Schenectady County Legislature is looking to close a projected revenue gap of at least $10 million going into the 2009 budget year, a county legislator said Monday, so trimming programs and services is under study.

“I cannot emphasize how critical our finances are. There are pressures and the hemorrhaging has to stop. We will have to go through multi years of corrections,” said Legislator Philip Fields, D-Schenectady, chairman of the Legislature’s Ways and Means Committee.

Under review for cuts are day care, highway lighting, aging and youth services and local government, Fields said.

The county funds hazardous material coverage through a contract with the Schenectady Fire Department, pays for some police protection in the city and pays to help operate the horticulture center in Central Park. It also pays millions of dollars to operate the countywide public library system and Glendale Home, both non-mandated services. Such programs and services represent approximately 20 percent of the budget; the rest are mandated state and federal programs over which the county has little control.

SHARE THE PAIN

“There may be some changes in who gets money in the long run. Maybe it is about time certain municipalities, which are doing better fiscally, pick up costs we have been funding,” Fields said.

Fields called some of the proposals controversial, adding he has yet to discuss them in detail with his Democratic caucus. “We will have to resolve them, whether they are controversial or not,” he said. “We will find solutions and we will come up with creative things.”

In the long run, Fields said, the county will have to “cut millions, not hundreds of thousands of dollars” to bring in balanced budgets for next year and thereafter.

The county’s budget cycle runs Dec. 31 to Jan. 1. It usually has a budget in place by late October or early November. Legislators have not yet decided on any options.

Fields said the county may also sell more of its surplus land and ask the Metroplex Development Authority to pay infrastructure costs on economic development projects which the county now pays.

The county this year is selling 24 acres at the Schenectady County Airport to Fortitech, a creator of nutrition supplements, for $1.2 million. Fortitech plans to build a $4 million research center and warehouse there. The county also accepted $150,000 from Metroplex to build a road to the proposed Fortitech project. The county will own the road.

In addition, the county is considering slowing down the pace of several major capital projects, such as the proposed $7.7 million rehabilitation and expansion of the central branch of the public library and work at Schenectady County Community College, Fields said.

LIBRARY AND COLLEGE

The county is scheduled to provide $5.7 million toward the library project, and it is responsible for sharing with the state half the costs of construction projects at SCCC. It may divert these funds to other purposes, county officials said.

The county’s difficult fiscal picture is necessitating these considerations, Fields said. Revenues are declining while costs are increasing.

To begin with, the county is looking at a structural budget deficit of at least $8 million going into 2009. Officials used the fund balance to close the deficit in the current budget. They are reluctant to use the same amount for 2009, for fear of depleting the account. The fund balance currently stands at approximately $20 million, less than 10 percent of the county’s $283 million current budget.

Fields said the county is seeing for the first quarter of this year a decline in mortgage tax receipts and a reduced rate of growth in sales tax; these are now seen growing 1.5 percent vs. the usual 3 percent annual expansion. The current economic slowdown has affected both key revenue streams.

On top of this, the county is losing $1.3 million in state and federal aid this year and expects to lose an additional $1.6 million in 2009. The state and federal cuts hit after county legislators approved the budget last year, as the state and federal governments are on different budget cycles.

Meanwhile, county costs for Medicaid, to pay its bond debt and for employee wages and benefits continue to climb by millions of dollars going into 2009, Fields said. And the county remains under state mandates to increase the number of corrections officers at the jail and to correct deficiencies in the county courthouse.

Fields said the county is trying to narrow the deficit gap this year through constant monitoring of costs and by trying to find ways to increase revenues. The county, for example, continues to achieve significant savings through its prescription drug program for employees and other savings in health care costs, he said.

The county last year made $3 million in cuts to the initial budget projections, reducing by half a proposed 9.7 percent increase in the property tax levy. The items cut came from so-called discretionary areas in the budget , areas such as supplies and equipment, staffing and professional service contracts. The budget grew by 1 percent in expenditures from the prior year.