Budget background from county administrator Zac Marsh

The back story...

Total revenue and total expenditure numbers show the commission is budgeting to spend more than it receives in 2017. The commission may do that by using unexpended funding received in prior years. Also, the commission’s current cash balance position is very strong – strong enough to operate for five months with no revenue, if necessary. Offsetting considerations: expenditures have been less than budgeted for several recent years, including the last four in a row. And revenues are typically somewhat higher than the conservative forecast. So, a reduction to the cash balance may not actually occur, but is possible if all appropriations are spent and revenues do not meet or exceed the forecast. Even if this occurs, the reduction in cash balance will not substantially affect the five months’ reserve.

This spending pattern is not meant to be sustained. It is the result of planned renovations of several county facilities: the security project at the courthouse, rearrangements of floor space and updating of the HVAC system at the Frank Green Building to accommodate the expanding needs of the Department of Human Resources (DHR), and the renovation of another wing at the Family Services Center to provide additional space for courts and other county and government agencies.

The 4-percent increase in health insurance premiums is a concern. With the county absorbing 85 percent of the increase, the budget impact is significant, usually requiring cuts to other budget items. Additionally, it has traditionally been a priority that take- home pay not decrease for employees. So when health insurance rates increase, the commission has usually offered a cost-of-live adjustment to wages sufficient to offset the increase in the portion of the insurance premiums paid by employees. The decision made this year was to grant a 2-percent raise to employees as a cost-of-living increase. It will become effective in December, 2016, concurrently with the increase in health insurance premiums.

In addition to the 2-percent increase, employee wages will then be increased by one quarter of what is necessary to implement the new Auburn Center for Governmental Services pay scales resulting from an extensive study of wages for comparable work in surrounding counties. Example: If an employee currently makes $10.00 per hour, and the new pay scale specifies $10.60 to reach parity with wages in surrounding areas, the employee would first receive the 2-percent increase discussed above, bringing his/her pay to $10.20 per hour. The difference between $10.20 and $10.60 is 40 cents. The employee would receive one quarter of that amount – 10 cents per hour – added to the $10.20 they will make after the cost-of-living increase for a total of $10.30 per hour for the coming year. The new pay scales may take two or more additional years to fully implement.

Quotes on 2017 budget cuts: “Cuts were made,” Marsh said, “to help offset increasing costs of some expenditures, but great care was taken to ensure the continuation of currently-provided county services. Some expenditure items were shifted to one or more other funds (accounts) to make more efficient use of revenues. .. Some of the expenditure cuts represent reductions in personnel through attrition, where an employee retires and is not replaced. Other cuts result from reductions in allowable purchases of equipment and durable goods.”