PORT ANGELES — A debt-free Clallam County, buoyed by retail sales taxes, stayed afloat in black ink during the first six months of 2005.

County Administrator Dan Engelbertson, presenting a mid-year budget report required by the County Charter, said Tuesday, “We’re holding our own.”

The picture wasn’t rosy, he said, citing property taxes that cannot increase by more than 1 percent of the budget each year and timber taxes that nearly fell off the chart this spring.

“The retail sales tax is keeping us afloat in the general fund,” Engelbertson said.

Costco move would hurt

But those revenues could drop $400,000 a year if Costco follows through with the move it is considering from its location on U.S. Highway 101 to a new building in Sequim’s “big box” district.

“At some point, the county needs to consider some impact fees on commercial developers,” he said, explaining that county services to newly developed areas are not supported by revenues.

In addition, the county faces long-term revenue losses to annexations by the cities of Port Angeles and Sequim, increasing personnel costs, more demand for services, population growth, and budget shortfalls the state passes off onto Washington counties.