Oil revenues have taken a big whammy from the COVID-19 pandemic, and that’s likely to have a large impact on programs next year, according to Richland County Commissioners.
Commissioner Duane Mitchell said the county received around $4.11 million in July from oil revenues, but its last check, received on Oct. 27, was just $1.25 million.
“We are down 75 percent of oil revenue money from the state, and that is oil produced in Richland County,” Mitchell told the Sidney Herald. “The oil we produced in the quarter we got paid for in July, we had about 46 percent of the oil (production wise). This one is 35 percent, so our production is down 10 percent. The total revenue is still far better than anyone else, but it’s down 75 percent.”
Mitchell said one thing many people might not realize is that many of the newer buildings that have gone up for community services, from fire halls to senior citizens and the fair grounds, have been paid for with this funding.
“This is going to really curb new construction for a while,” Mitchell said. “And we do use quite a bit of this money to backfill the budget, so we have to look really hard as to how we will face this deficit, as will everyone else. And the year is not yet over.”
The drop in oil revenue, however, is just part of the story when it comes to revenues that support county and state services, Mitchell pointed out.
“All the businesses are not making any money,” Mitchell said. “they are not earning because they don’t have any business. Everything is down.”
This is likely to mean significant cuts over the next year, Mitchell suggested.
“Somehow, some of the services are going to have to be cut, eliminated, or severely reduced in my opinion,” Mitchell said. “That will have an effect on everyone. The whole county. The road department, health department, all the other entities we have going. If the money isn’ there, you have to do something. It’s just like your house. You may have to eliminate the cable bill to keep food on the table.”
Mitchell said the current budget is in good shape, but that the lack of revenue going forward cannot help but affect the next fiscal year, which is just six to eight months away.
Richland County is not the only governmental entity that is feeling the pinch of depressed oil revenue.
Sidney’s Deputy Clerk Treasurer BreeAnn Shanks also reported a dramatic drop in oil revenue at the most recent city council meeting. Shanks said the city’s first oil payment in fiscal year 2020/21 was around $41,000, while the most current payment was $14,976.