Finance Director Tawana Keels originally thought she had to erase $5 million from the budget plan because office holder and department head requests came in about $2 million over the tax budget estimate of $95.2 million and a federal mandate is predicted to cut $3.1 million in sales tax.
The county was anticipating a jump of $2.3 million — or 5.4 percent — in sales taxes next year, but Keels trimmed that back to about $41.5 million overall.
The $3.1 million hole in the budget is due to the Centers for Medicare & Medicaid Services ruling Ohio has unlawfully collected sales taxes on Medicaid matching monies on transit systems. That sales tax disappears in July.
Keels said the county can now count on receiving about three-quarter’s of the Medicaid tax next year, or $2.4 million, so they were able to structurally balance the budget.
“That increased revenue, $1.2 million in budget reductions and then the Medicaid closed the gap…,” she said. “This is the first year where we had a situation where revenue was being reduced. We haven’t had that since I’ve been here so that made the budget cycle more challenging.”
Keels said the Medicaid money will reportedly disappear in 2018 — unless the state comes up with a way to mitigate the loss.
John Charlton, communications director for the state Medicaid department said they are working a solution.
“We know this will impact county governments and transit authorities as well as the state. We are currently looking at a number of solutions to mitigate that impact,” Charlton said. “Our final recommendations will be included in the executive budget released on Jan. 31.”
The proposed county budget also includes a new performance pay model that would give all non-union employees a two percent cost of living hike on their base pay and up to two percent in merit raises that will be paid off quarterly in lump sums.
County Administrator Charlie Young said the new model will allow the county to remain sustainable.
“The major cost of government is labor, that’s just how it is because of how we function and what we do, it’s people,” he said. “You have to reward people, you also have to do so in a sustainable way. This new plan gives us the ability to understand and therefore control our biggest cost. It gives us the opportunity to attract and retain employees by being able to tell them what to expect.”
Keels and Young have been meeting with all of the boards, office holders and department heads since the budget hearings in October, to identify where cuts could be made. Keels said there wasn’t a singular cut that made the difference in the $1.2 million reduction. One example of areas officials agreed to budget reductions were in the requests for new hires.
After many extremely lean years, when the county almost toppled off the proverbial fiscal cliff, judges from the area, juvenile and probate courts; officials at children services, the coroner, the Child Support Enforcement Agency, JFS, the mental health and addiction services and Ohio State University Extension all wanted to add staff, to the tune of $1.25 million.
Keels said the budget process was a group effort where cuts were concerned.
“Every department is part of that $1.2 million,” she said. “I don’t know that one particular department comes to mind as standing out. I think they all equally contributed to help us balance.”
The commissioners have made commitment to a couple other "programs" as well, like their promise to erase the entire general fund debt by 2020. The debt that stood at $91.3 million in 2009, will be $34.9 million by year's end and zero by 2020 under a debt reduction acceleration plan. The accelerated debt payment is pencilled in at $2.5 million next year.
The county commissioners have also started a budget stabilization fund to bolster the budget should the economy take another tumble. Keels said $14 million would be optimal as a balance in that account that currently totals $4 million. She will be asking the commissioners to add another $2 million to that fund next week.
“I think based on the times we may have, if we actually have a recession, I think it’s really prudent to continue to grow that fund and have those resources so again we can operate the county,” she said.
Commissioner T. C. Rogers said he is proud of the county’s handling of finances.
“We only operate this county with cash, meaning we only spend the money we take in,” he said. “But we still do it with compassion and we are still able to take care of those who can’t take care of themselves.”
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