For Racine County government, Christmas doesn't come in July. But, in a way, New Year's does, because in July, we're putting together our budget for the next year. And based on what we see now, the 2009 budget will be little cause for celebration.

Earlier this week we announced a hiring freeze for the rest of 2008. We're not going to fill vacancies, except where it's necessary for public safety or to meet the needs of our vulnerable populations. Nor, at this point, do we plan to fill those positions next year. In fact, some will be eliminated in the 2009 budget.

Why not fill those positions now? There's a simple answer. It wouldn't be fair to the individuals to hire them in the second half of 2008, then lay them off because we can't fund their jobs in 2009. Nor would it be fair to taxpayers, who'd have to pay unemployment compensation for laid-off workers.

Given next year's uncertainties, it makes sense to leave slots open for the rest of 2008.

There are three main reasons why we're concerned about next year.

1. State and federal funds are being cut. Budget problems in Washington and Madison are working their way down to us. The July 19th Journal Times reported that Racine County's share of a major federal law enforcement grant will be 35% of what it was last year.

Last week, the state Department of Workforce Development agreed not to remove its Job Service staff from the Racine County Workforce Development Center, but DWD will reduce how much it pays to occupy space in our building.

In the critical area of child support enforcement, the state was going to help fill a gap in federal funding, but now Wisconsin's budget shortfall threatens that stop-gap. We'll lose vital funds we'd been counting on.

2. Our costs are going up, but not our non-tax funding sources. County government is not immune from cost increases for food, fuel, equipment, and supplies. We've sometimes found ways to cushion cost increases by, for example, carrying over savings from a previous year. This year, we'll be able to do little of that.

Moreover, in these difficult economic times, some important sources of the county's non-tax income - permit fees, real estate fees, and interest on our investments - are not doing as well as we'd like.

Here's one example of how cost increases and reductions in non-tax funding sources are hitting us. For the county's Human Services Department just to maintain present service levels in 2009, we'd have to increase its share of the property tax levy by more than $1.9 million. That's a 27% increase over its present share of the tax levy and more than a 4% increase on the total general countywide levy. And that's just one department.

3. We can't ask too much of our taxpayers. I said that county government is not immune from wide-ranging cost increases. But neither is any individual, family, or business. Our families and businesses must find ways to cope. So must local governments.

State law limits a county's property tax levy increase with a formula based on the value of new construction in the previous year, or 2 percent, whichever is more. Because we won't know the new construction numbers until mid-August, prudence requires us to expect no more than 2%.

But we have to ask ourselves how county taxpayers will react to even a 2% property tax increase this year, especially when at least one school district is talking about a 12.5% jump.

For all these reasons, our budgeting for 2009 must be extremely austere. That includes not hiring in 2008 new staff who are not essential to public health or safety, but whose employment might end in just five months.

McReynolds is the Racine County Executive.