Clare County BOC Special Meeting 1/11/12
By Mary Kindig
The Clare County Board of Commissioners held a Special Meeting on Wednesday to discuss possible solutions to the County’s looming 2012 deficit. Chairperson Don David began the meeting by announcing that the Ad hoc Committee – recently formed to study budget solutions and make recommendations to the Board – had set a goal “to reduce our budget deficit by $500,000.”
Other recommendations from the Ad hoc Committee included asking the Sheriff’s Department – and all other departments that can – to eliminate overtime. The Committee also recommended that the Sheriff cut the Bayonet revenue, that direct deposit of all payroll begin April 1st, that the County cut the Household Hazardous Waste program, and that the County develop a five-year budget plan.
Members of the Ad hoc Committee – Senior Services and Community Development Director Lori Ware, Equalization Director Kim Halis, and County Treasurer Jenny Beemer-Fritzinger – sat before the Board behind reams of paperwork, prepared to explain proposals, answer questions and provide additional information.
Chairperson David began by putting forth the budget plan the Committee felt would best address the budget deficit. “If we can work this percentage of revenue budget and save $500,000, it will not be necessary to cut personnel. Now, having said that, how the departments cut their share of the revenue budget will depend on them. In other words, if they wanted to turn a full-time job into a part-time job, that’s up to the department head. If they want to eliminate somebody completely, that would be up to them. But if we can do this percentage of revenue budget and save $500,000, we should be well on our way to making the fund balance sound again. We’ll have money in 2013 budget. Now we’re not paying everything all off at once; we’re not making up the difference completely all at one time. We’re going to have to work at this in stages so that we can accomplish what we want and not set an impossible goal for the departments. It looks like this is the way to go,” David said.
The percentage of revenue budget, as explained by Lori Ware at the Board’s regular meeting last Wednesday, would figure the percentage of the known revenues that each department spent over the last three years, and then apply that percentage to 2012 revenues to establish the funding level for each department. Using that method for setting departmental budgets would ensure that the County’s expenses could not exceed the revenues, and that it would not be necessary to dip into the current dwindling fund balance.
When the subject of cutting the Bayonet program came up, Sheriff John Wilson interjected that Bayonet is not an expense, per se – it is a match grant. Wilson said that Bayonet subsidizes the officer, and that he took a road patrol officer and made him a part-time Bayonet officer, which did not increase his budget.
Treasurer Beemer-Fritzinger spoke to the rumor that she had found extra money in the budget. “When I first came in, there was barely enough – I had to scrape money together to pay all the taxing entities, all the millages that your taxpayers pay? I had to scrape money together to be able to pay those. So when Bill [Newkirk] was here, we had a plan where we were going to try to build the fund back up, so that we had the money – because, by law, I have to pay all the taxing entities. You guys pay a millage, I have to make sure I pay it out, and that’s how the delinquent tax fund works. And then anything delinquent, then my office collects. So we’ve been building it up the past few years, and this year was the first year I actually put money back in. I’ve been working with the auditors and some other treasurers to see where they think, if we could, add a little bit more. And so we’re going to try to add $200,000 more.”
Beemer-Fritzinger also articulated the current problem, saying, “Being a quarter of the way through the [fiscal] year, you have to do something this year, whether you want to or not.” She continued, “You have 1.2 million in the fund balance right now, so you could slide by this year, but it would leave you only $300,000 in the fund balance for 2013.”
Clerk/Register of Deeds Pam Mayfield said she would like to see the figures upon which the department’s percentages are based. “They should be there for the purposes of examination,” Mayfield said.
Lori Ware responded, “Bill Newkirk came up with those percentages.” As the meeting went on, Beemer-Fritzinger said she had started to check those figures, and the Ad hoc Committee agreed that they should re-do the percentages together to make sure of their accuracy and to provide department heads with a more detailed accounting of those figures.
“If there’s $1.2 million in the fund balance, then why are we doing all this?” Lori Ware asked.
“Because we’ll be losing $811,000 to balance the budget,” Administrator Tracy Byard answered.
Beemer-Fritzinger added, “Last year, we ended the year with an $800,000 deficit. Generally, you end the year with a $2 million fund balance. But last year we ended with a deficit of $800,000, which reduced our fund balance to $1.2 million. So technically, we’re fine, but then comes the 2012 budget and we have these expenses and we have these revenues, but we cannot come up with revenues to match these expenses. We’re $811,000 short in the revenue. So that’s what we’re trying to correct is that $811,000 piece, to at least break even…So I’m not even saying you’ll have to cut the whole $800,000, but you’re going to have to cut something.”
Beemer-Fritzinger continued, “I agree with the percent of revenue [approach]…Being a government body, we’re not here to make money, and I know we want to increase the fund balance. I know eventually we do, I just don’t know if this is the time to do it. My take – and obviously it’s only my take, because I make no decisions here – we’re only information-givers – and from the current expenses and the current revenues that are projected, including what I’m trying to bring over from the delinquent tax fund in reversion, my take is you should only cut what needs to be cut – not extra.”
There was a point where Beemer-Fritzinger could not understand where Ware got her revenue figure. Beemer-Fritzinger was seeing revenues as the approved revenues from the 2012 budget, and Ware was using actual revenues received in 2011 as the basis for her figures.
“We have to agree on what the projected revenue would be. Is it going to be taking the exact number of revenue we received and adding in additional revenue, or are we going to use revenue received plus fund balance dollars. How do you want us to do it?” Ware asked the Board.
“I’m in favor of using the actual revenue that we know of. We know it’s probably going to go down or up, depending on what happens to the economy, but that’s the best start,” Commissioner Jerry Burger said. Commissioner Lynn Grim, who was participating in the meeting via tele-conference, agreed.
Commissioner Jack Kleinhardt asked if the Board should also be compiling a budget with 2013 in mind. With the likely repeal of property taxes and all the County’s union contracts coming due in 2013, Commissioners agreed that about the only thing they could do about 2013 at the present time was to try to leave a healthy enough fund balance to be able to better deal with whatever comes.
“We’re going to be in trouble next year anyway, because he [Governor Snyder] is cutting personal property [tax] – we just don’t know what he’s cutting. So, no matter what, you’re going to make cuts this year, you’re going to have to make cuts next year too – unless a miracle comes through and somebody gives us revenue,” Beemer-Fritzinger commented.
“If departments continue to watch what they’re spending, then we should be on a better track, even if you don’t cut the full $500,000,” Administrator Byard said. Byard also reported that the tax anticipation note interest rate came in at 1.09 percent, which was better than the 1.29 percent the County received last year.
The only business the Board conducted was to unanimously pass an amendment to the EPA contract, to extend the period through September 30, 2012. Chairperson David said that the Board would be voting on the recommendations of the Ad hoc Committee at the next regular Board meeting, which is January 18th.