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INDEPENDENCE – After recommendations from the county administrator and a few additional adjustments, Grayson County Supervisors have closed the gap in the 2013-14 budget by more than $1.2 million.
Supervisors held their second budget work session on May 1 and began the night facing a much more manageable $240,000 deficit between projected revenues and expenditures for the FY 2014 budget.
County Administrator Jonathan Sweet reiterated that, from his staff’s perspective, the budget needed to be balanced without dipping into the reserve balance and/or raising taxes.
The initial deficit listed during the first budget work session last month was more than $1.4 million, though that included total expenditures recommended and staff had yet to make any recommendations on it.
Sweet brought back a handful of recommendations that closed the gap down to $240,000.
Among those recommendations were:
• $350,000 savings in school debt payments. Sweet explained that last year the county budgeted $975,000. While he recommended a budgeted amount of $650,000 for this year’s payments, Sweet pointed out that next year that number will be $1.15 million when the new financing goes into place.
• $105,000 savings in community development. Previously, the board had budgeted $430,000 in this fund and it was taken down to $325,000.
• $100,000 savings in reserve transfer. Last year the board budgeted $250,000 to be transferred to the reserve fund at the end of the year and Sweet recommended that be adjusted down to $150,000 this year.
• $100,000 savings in sheriff’s department. Sweet explained that various line items were cleaned up in the budget and that while the amount may change, $100,000 was taken out to close the gap.
• $90,000 savings in care of prisoners. Previously the county had budgeted $690,000 for care of prisoners, but with the success of the Day Report Center, Sweet recommended that be lowered to $600,000.
• $30,000 from Mental Health.
• $20,000 from Public Works.
“We are still working through the adjustments,” Sweet pointed out, explaining that the staff’s process is to start in the bigger budgets and/or requested increases and work their way backwards. From there, they look through the medium-sized budgets and increases and then dive into the smaller areas.
“We look at the percentage of difference and department [budget] size,” Sweet said.
Although the $1.15 million payment for school debt is a year away, Sweet pointed out to the board that if that number was plugged into the current deficit it would stretch the gap back to $740,000.
“We just want to keep that in mind,” Sweet told the board, noting that one of the objectives for the county’s budget process is to look at known expenses on the horizon. “We need to be cognizant of the known financial obligations for next year’s budget.”
Facing $240,000 left to cut, Supervisors began to make additional suggestions for the 2014-15 budget.
Chairman Mike Maynard asked Sweet and his staff to look at negotiating contracts such as software management, legal retainers and procurement. The board also asked Sweet to look into further joint contracts with the school system and similar ideas to maximize discounts offered for larger purchases.
One area where Sweet recommended the board consider funding is an Information Technology (IT) department. Currently the county has to outsource any kind of IT work. Sweet said it would benefit the county to look at the advantages between a full-time employee and/or a set contract for IT services.
Sweet said hourly fees for service are costly for standard needs and even more expensive for emergency needs.
“We haven’t done anything proactive in IT,” Sweet said. “It’s always been reactive.”
Sweet recommended pulling money out of budgets previously spent on IT and combining those funds to create a separate IT budget. From there, staff can recommend whether a full-time hire is necessary or if a set contract is the best way to go.
Previously, the board had looked at joining forces with the school system for IT needs, but Sweet said that deal fell through.
“If we don’t need to hire someone [full-time], we won’t,” Sweet reiterated. “If we don’t need to spend the money, we won’t.”
Sweet described the county’s approach to IT as a “bubble gum and duct tape” method, which simply holds the pieces together and costs the county much more money and time down the road.
Sweet also recommended the board look at a draft capital improvement program.
He explained that in previous budget years all capital improvement projects were typically funded through the individual budgets.
The problem is if there is a one-time capital improvement project that costs $15,000 and the next year that department is level funded, then the department actually has a significant increase in their operational budget because that $15,000 is not needed.
Instead, Sweet recommended the board move all capital improvement projects above a certain cost to a single line-item in the budget and create a plan that prioritizes those projects on an annual basis.
The draft written up by Sweet called for any funding of facilities, equipment, and vehicles with a cost greater than $24,900 or a project cost greater than $34,900 to be put on the five-year plan.
This will serve as a county-wide financial planning tool for capital projects and will be adopted as an addendum to the county’s annual budget.
Sweet asked all departments to submit projects they’d like to see on the plan and prioritized those over the next five years.
Projects on the initial draft include:
• Water meter replacement projects ($140,000) to be done in 2013-14.
• County phone system replacement ($40,000) to be done in calendar year 2014.
• Recreation park lighting replacement project ($300,000) to be done in 2013-14.
• Compactor truck purchase ($115,000) to be done in calendar year 2015.
• Courthouse roof replacement project ($80,000) to be done in calendar year 2015.
• Transfer station construction ($30,000) to be done in calendar year 2015.
• Animal Control vehicle ($30,000) to be done in calendar year 2015.
• Inspections vehicle ($25,000) to be done in calendar year 2015.
• Softball field improvements ($65,000) to be done in calendar year 2016.
• Security fencing project at the public works facility ($25,000) to be done in calendar year 2016.
• Courthouse paving project ($95,000) to be done in calendar year 2017.
• Pool repair project ($40,000) to be done in calendar year 2017.
• Tennis court repair project ($30,000) to be done in calendar year 2017.
• Tractor-trailer purchase ($75,000) to be done in calendar year 2018.
• Community Center Project ($2.5 million) to be done in calendar year 2019.
Sweet explained that the board could change priority of the projects at any time.
Currently, the county has $76,000 in the capital improvement fund, with $180,000 in the current budget to be transferred next month.
For the 2013-14 budget, Sweet said $325,000 was included, meaning by the end of next year that fund balance would be $581,000.
“We can start funding those projects [on the list] and continue to put money into that fund each year,” Sweet said. “If something catastrophic happens, we can amend the [plan] and make the transfer for those projects if needed. This is the way healthy, logical organizations operate.”
Still facing the $240,000 deficit, supervisors began looking at individual budgets and recommended the following in additional cuts:
• $6,500 savings from professional services in the supervisors department.
• $2,500 savings from travel in the supervisors department.
• $46,000 savings from health insurance in the personnel administration department
• $10,876 savings from salaries in the treasurer’s department.
• $1,500 savings from data processing in the treasurer’s department.
With the next set of cuts, supervisors found their budget to be off by roughly $173,000.
Maynard suggest that Sweet and his staff work with the department heads to find other areas to cut and bring recommendations back to the board during the next budget work session.
Supervisors will hold their next regularly scheduled meeting on Thursday and their next budget work session on May 15 at 6:30 p.m.