County bud­get de­layed un­til fall

The Standard Journal - - FRONT PAGE - By Kevin Myrick [email protected]­stan­dard­jour­nal.net

Polk County Com­mis­sion­ers want more time to fig­ure out how to bal­ance the books and han­dle all their pri­or­i­ties for the com­ing year, and will also be look­ing to move how they com­plete their an­nual bud­get process for the fu­ture.

All agreed with­out a vote to push back a vote on the 2019 Fis­cal Year bud­get af­ter a pro­longed 2-hour dis­cus­sion over re­quests for ad­di­tional funds, pri­or­i­ties like the 80-20 re­tire­ment rule, re­duc­ing group in­sur­ance costs, giv­ing em­ploy­ees raises and a con­ver­sa­tion about rev­enue sources that ended with the prom­ise of more dis­cus­sion in June.

Com­mis­sion Chair Jen­nifer Hulsey tasked the board to fig­ure out dates this week dur­ing their work ses­sion and reg­u­lar ses­sion for June, adding two more meet­ing dates to this month now that they’ve de­layed the dis­cus­sions for now.

The heart of the is­sue is whether the Board of Com- mis­sion­ers and the county ad­min­is­tra­tion can agree on where rev­enues and ex­pen­di­tures need to land for the sec­ond half of the cal­en­dar year, and head­ing into 2019.

Hulsey said that ad­di­tional work ses­sions, fi­nance com­mit­tee meet­ings and data will be needed to fig­ure out how to make all their pri­or­i­ties work at once for the com­ing year, and wants to meet again af­ter this week’s reg­u­lar ses­sion.

The ad­min­is­tra­tion sub­mit­ted the $22.1 mil­lion bud­get for con­sid­er­a­tion dur­ing their May reg­u­lar ses­sion, and a first work ses­sion was held on May 15 to al­low for the board to ask some ini­tial ques­tions and hear from de­part­ment heads seek­ing ad­di­tional funds.

How­ever, fol­low­ing that meet­ing on May 22, County Man­ager Matt Den­ton told the board of an ad­di­tional need for the com­ing fis­cal year: a half-mill in­crease in prop­erty taxes.

That move comes as rev­enue sources out­side of taxes are be­gin­ning to de­crease af­ter re­cov­er­ing some from the re­ces­sion. Fines and fees im­posed by ju­di­cial pro­ceed­ings – specif­i­cally fines in crim­i­nal cases – have re­duced dras­ti­cally over the past years.

An­nual tag taxes and fees re­placed by a new sys­tem in past years con­tin­ues to go down as more peo­ple buy or trade cars, and only smaller fees are as­sessed. In­creases in the amount the state shares in new ve­hi­cle taxes and an­nual re­newal fees are on the way af­ter new leg­is­la­tion was passed in the past ses­sion. Those fees alone it isn’t enough to off­set in­creases in ex­penses and de­creases in rev­enue.

Where the money will come from to cover costs of more than $22 mil­lion bal­anced bud­get is one rea­son why the board wants more time, and a chance to change the process for com­ing years.

Start­ing fresh on

the bud­get

Com­mis­sion­ers want to start with a fresh process when it comes to the FY 2019 bud­get, so when it comes time to tally the amount of money ex­pected in and go­ing out each year, they do so with­out hav­ing to make ed­u­cated guesses at what is avail­able.

Over the past years the county along with the City of Rock­mart and City of Aragon have un­der­taken pass­ing their bud­get on a July to June year for their bud­gets. That means when of­fi­cials are de­ter­min­ing the pri­or­i­ties of spend­ing for the year for the mu­nic­i­pal gov­ern­ments, they are do­ing so with­out hav­ing a com­plete pic­ture of what they’ll get in from taxes and be able to spend through the rest of the year.

The rea­son has to do with the lo­cal prop­erty tax di­gest, which is compiled an­nu­ally dur­ing the sum­mer and has to be sub­mit­ted to the state at the end of Au­gust.

Hence why in past years, lo­cal boards have de­ter­mined a mill­age rate to be set late in the sum­mer be­fore tax bills go out to lo­cal res­i­dents.

With­out hav­ing a com­pleted tax di­gest on hand, fi­nance of­fi­cials within the mu­nic­i­pal­i­ties have to de­ter­mine their bud­get based on es­ti­ma­tions of how much tax rev­enue is an­tic­i­pated for the year.

This forces ad­just­ments to the bud­gets, usu­ally at the mid­way or end of the bud­get cy­cle to ac­count for rev­enue that didn’t come in, or ex­penses that had to be cut.

Bud­get amend­ments also are used to add unan­tic­i­pated rev­enue to the bud­get, as the county had to do in past months in or­der to take in money from sev­eral sources that can then be used for spe­cific projects or pur­chases, like in­sur­ance money re­ceived for wrecked ve­hi­cles in the county or grant money that wasn’t in­cluded in the past year.

Ap­prov­ing a bud­get be­fore the tax di­gest be­comes avail­able can cause prob­lems, like short­falls in ex­pected rev­enue, and the need for Tax An­tic­i­pa­tion Notes to cover ex­penses un­til those rev­enues come in.

The county hasn’t needed a TAN in a num­ber of years to bal­ance the bud­get tem­po­rar­ily and en­sure there is plenty of money left in the bank, but to fix fur­ther prob­lems with bud­get num­bers will re­quire a real change in the way the process is com­pleted. Com­mis­sion­ers want a com­pre­hen­sive look at how much rev­enue is avail­able dur­ing the year.

It won’t how­ever fix one prob­lem in the bud­get process: es­ti­mat­ing ex­pen­di­tures.

When Fi­nance Di­rec­tor Muriel Du­laney puts to­gether what she thinks the county will spend each year, she uses a snap­shot of a sin­gle day’s costs to run the county as a ba­sis for the rest of the year. That snap­shot was taken in the spring months and gives the county a rough idea of how much it will cost to pay em­ploy­ees and their in­sur­ance, util­i­ties, funds paid out to agen­cies and much more.

The snap­shot doesn’t ac­count for changes that can be made from day to day within the county govern­ment. Em­ploy­ees come and go, and so does changes in start­ing pay, along with their in­sur­ance needs. Emer­gency funds might be needed for an un­ex­pected re­pair of equip­ment or re­place­ment of a roof as other ex­am­ples.

All of that adds up, and if the county doesn’t ac­count for the ex­tra costs or freed up money, they re­quire amend­ments for the bud­get later in the year.

The hope is that by mak­ing a change to the way the bud­get is de­signed by wait­ing for the tax di­gest to be gen­er­ated and dis­trib­uted un­til the fall, the county can de­sign a bet­ter and more re­al­is­tic ac­count­ing of rev­enue and ex­pen­di­tures for the year.

Es­pe­cially with the is­sues the county com­mis­sion wants to fix in the months and years to come.

Ris­ing costs of do­ing busi­ness

There’s a lot the county com­mis­sion wants to fix in the years to come to en­sure that both the tax­pay­ers and the em­ploy­ees do­ing the work of the lo­cal govern­ment are both get­ting good deals.

Pri­or­i­ties dif­fer from one com­mis­sioner to the next as dis­cus­sions over spend­ing needs went on for two hours dur­ing the county’s sec­ond work ses­sion on the bud­get.

Com­mis­sioner Hal Floyd con­tin­ued to push for some­thing to be done about the ris­ing cost of group health in­sur­ance cov­er­age.

In­sur­ance needs an ad­di­tional $ 273,501 to cover added costs, or a 23 per­cent in­crease from 2018 to 2019’s bud­get. Com­bined, it only amounts to a to­tal 6.6 in­crease in rev­enue.

The rate is up to over 80 per­cent of all those in­sured sub­mit­ting a claim, and also ed­u­ca­tion is­sues within the county work­force about health.

Floyd wants to dig into the is­sue and see what can be done about low­er­ing the cost in years to come, and also ad­dress how much fu­ture em­ploy­ees should have to cover in their part of pay­ing for monthly health in­sur­ance pre­mi­ums. Cur­rent em­ploy­ees would keep their same per­cent­ages.

“One, if you’re an em­ployee you’re re­ally in luck,” he said. “We owe it to them, they’re en­ti­tled to it. But in the fu­ture, do we know what our com­pe­ti­tion in other coun­ties are pay­ing, what per­cent their con­tri­bu­tions and pre­mium they’re pay­ing?... in­dus­try is around 50-50 to 60-40. If you av­er­age out the cost, it comes out to $12,000 a year per em­ployee.”

Along with that, Com­mis­sioner Scotty Tillery wants to look in-depth at the num­bers sur­round­ing the 80-20 rule, an is­sue he’s been work­ing on for sev­eral months. In bring­ing up the dis­cus­sion dur­ing the county’s work ses­sion last week, Den­ton said he be­lieved the county would do bet­ter by of­fer­ing to buy out em­ploy­ees and cut them a check at the cur­rent time in­stead of look­ing at the po­ten­tial new re­tire­ment scheme.

His ar­gu­ment is that like a cor­po­ra­tion that de­cides to buy out em­ploy­ees who are older but don’t yet want to re­tire, they can de­ter­mine the of­fers they want to make.

The idea is that older mem­bers of the county work­force could be of­fered a chance at money now to re­tire early, and re­place the po­si­tion with an em­ployee at start­ing pay.

Pay scale is an­other area where com­mis­sion­ers still want time to fig­ure out as well. They’re wait­ing for the Carl Vin­son pay study to be re­turned, and with­out that they don’t have a solid un­der­stand­ing of the costs as­so­ci­ated with more than just the an­nual 1.25 per­cent in­crease to salaries, and the 75 cent an hour raise that em­ploy­ees got ear­lier in the year.

All of these items com­bine to give com­mis­sion­ers a good rea­son to de­lay pass­ing a bud­get, plus one more: they weren’t fully aware of the need to in­crease the mill­age rate un­til af­ter of­fi­cials sub­mit­ted the bud­get for con­sid­er­a­tion.

No mill­age rate in­crease for now

Where did this mill­age rate in­crease come from? It was the ba­sis of ques­tions posed by Hulsey to Den­ton since it had not been men­tioned dur­ing their first work ses­sion held on May 15, and wasn’t un­til an email went out on May 22 to the board that they learned of the need.

A half a mill­age point is around $340,000 in ad­di­tional tax rev­enue based on this year’s es­ti­mated real prop­erty tax rev­enue and the pre­vi­ous year’s mill­age rate. That in­di­vid­ual cost to home and landown­ers would be based on the value of a per­cent­age of their prop­erty.

Hulsey ex­pressed her con­cerns and un­ease about be­ing in­formed of the need for a mill­age rate in­crease only af­ter the first work ses­sion, when she felt that should have been ex­plained.

“What my real con­cern is why didn’t we hear about it at the first bud­get meet­ing, and did any­one else know about it, or was it just you and Muriel that knew about it,” she said.

She went on to add that in fu­ture bud­get con­ver­sa­tions, it will be an open process where all the com­mis­sion­ers will be in­volved. That in­cludes Marshelle Thax­ton who has not been to a board meet­ing in May fol­low­ing surg­eries and re­cov­ery.

Den­ton did apol­o­gize for not in­form­ing the board, but it was done within the past cou­ple of weeks. He said the mill rate in­crease came about be­cause of the in­crease in salaries.

Hulsey added that she was ad­di­tion­ally con­cerned be­cause com­mis­sion­ers had asked dur­ing their pre­vi­ous meet­ing whether ev­ery­thing in the bud­get would be cov­ered by the pro­posed rev­enues and ex­pen­di­tures.

“We were told that we’re wait­ing on the di­gest come back, and noth­ing about the mill­age rate in­crease,” Hulsey said. “I’ll be hon­est with you, when I get it in an e-mail in the mid­dle of the day – I didn’t get it un­til 10:30 af­ter the elec­tion… Am I the only one who is up­set by this?”

Den­ton said that “I wish I had been in the meet­ing” so he could have ex­plained it.

“You guys can fund it any­way you want to,” Den­ton said be­fore the de­ci­sion to post­pone bud­get ap­proval. “But no mat­ter what there is a $ 455,000 above the in­sur­ance and reg­u­lar cost of busi­ness in­creases… the only thing Muriel and I can think of is a mill­age rate in­crease.”

“I don’t like the way this was han­dled,” she said. “You think you’d let the board chair and the mem­bers of the board know that we’re do­ing that. I just didn’t like that at all. I want us to be open and hon­est, and that’s why I brought it up here. I feel like there are some side door con­ver­sa­tions, and I think that is what has got­ten us in a real pickle in the past.”

Com­mis­sion­ers don’t want to in­crease the mill­age rate if pos­si­ble, and in­stead are look­ing at other op­tions.

Tillery es­pe­cially wants to wait un­til he can present his work on in­tro­duc­ing new ser­vice-based fees for res­i­dents seek­ing the county’s help in a va­ri­ety of ar­eas.

Ad­di­tion­ally, they also want to look at how they can gen­er­ate sav­ings within the de­part­ments by go­ing line by line through the bud­get and see what is re­ally needed, and what might just be a dream.

Part of that has to do with sav­ing money on cap­i­tal im­prove­ment projects by forc­ing de­part­ment heads to make re­al­is­tic re­quests for their needs.

Com­mis­sion­ers also want to avoid tak­ing any­more of the land­fill funds still avail­able for use, since their hopes is to one day setup a trust to help fu­ture gen­er­a­tions not have to deal with is­sues the com­mis­sion is cur­rently fac­ing.

Ad­di­tional re­quests

for help

Dur­ing the first work ses­sion, com­mis­sion­ers heard re­quests for in­creases from three de­part­ments, and a fourth was added dur­ing he May 29 ses­sion.

Tal­lapoosa Cir­cuit District At­tor­ney Jack Brown­ing came be­fore the board with a re­quest for just over $13,000 in fund­ing to help boost his bud­get for FY 2019.

Pre­vi­ously, he used fine and for­fei­ture money to cover some ad­di­tional ex­penses within his bud­get to match some grant money for a po­si­tion, but now that is un­sus­tain­able with fine money go­ing down.

“It doesn’t take a fi­nan­cial guru that when your money is go­ing out faster than it was com­ing in, it was go­ing to be a prob­lem,” he said.

His hopes are the com­mis­sion can come up with some help, which is one fi­nal rea­son why they’ve de­cided to de­lay the FY 2019 bud­get.

Floyd said with all the re­quests be­ing made this year for spend­ing above $840,000 from a va­ri­ety of ar­eas, the com­mis­sion needs more time to fig­ure it out.

“There was nine re­quests for ad­di­tional money as op­posed to where we were, and this is one of the nine that we’re adding as op­posed that was in the bud­get orig­i­nally,” Floyd said. “

/ Kevin Myrick

County Com­mis­sion­ers de­cided that they needed to take a pause and work on bud­get num­bers through the sum­mer and come back to ap­prove a full FY 2019 bud­get in Oc­to­ber.

/ Kevin Myrick

District At­tor­ney Jack Brown­ing sought ad­di­tional money in his bud­get for the 2019 fis­cal year.

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