Formal presentations on the 2006 county operating and school district budgets are still several weeks away but members of the Beaufort County Council's Finance Committee got the word Monday that tax increases are in the works.

"To say 'zero mill growth' is a wonderful thing, politically, but we gotta face it: We're looking at a situation of 'pay me now or pay me later,'" Council Vice Chairman W.R. "Skeet" Von Harten said.

Monday's committee meeting was billed as an opportunity for council members to give budget guidance to County Administrator Gary Kubic and School Superintendent-elect Edna Crews.

But Kubic and Crews made it clear from the start they're looking at increases they have no control over.

"You're talking about delayed equipment maintenance, utility increases, hospitalization and insurance increases, they're all going to cost dollars," Kubic said.

Kubic said he also hopes to provide some cost-of-living increases for employees, but that last year's 2 percent increase cost $700,000.

Kubic and Controller Tom Henrikson said early calculations include a 2 mill increase for county operations. County officials are using a projected 6 percent growth factor for the county's tax base.

Crews said her staff is looking at the same increases, including a state-mandated 2 percent cost-of-living increase for teachers.

In addition, the current state budget includes a $6 million cut in support for Beaufort County schools, one of only two school districts statewide to receive reductions because of per capita income levels.

"I've directed my administrators to do some 'garden-weeding,' looking for areas where cuts can be made," Crews said.

School officials are hopeful members of the local state legislative delegation can get some of the $6 million cut returned to the budget. But Councilman Peter Lamb echoed remarks made before by Councilman Mark Generales, that the county should consider suing the state to alter the income formula used for fund distributions.

"Right now, we're being abused," Lamb said.

Crews promised a draft budget by the middle of next month.

"I'm hoping you're hearing the same frustrations we're hearing from property owners who just went through reassessment and now hear us talking about tax increases," said Von Harten. "They're not happy."

The committee also passed on a funding proposal drafted by Councilman Dick Stewart directing a specific portion of business license revenues toward economic development.

The proposal, which will be presented to the full council next week, directs the first $270,000 generated to support of the Beaufort-Hilton Head Economic Development Partnership.

Currently, contributions to the economic partnership come from the county's general fund.

Reporter Lolita Huckaby can be reached at 524-5448 or bftbay@charter.net