Butler County rebounded from near-financial ruin. Can it last?

After suffering massive layoffs, shortened work days for county employees and program cuts, Butler County officials curbed what some say was out-of-control spending and a bloated personnel roster.

With several indicators proving the county has rebounded, including a 75.5 percent drop in foreclosures and 50 percent drop in unemployment, officials say the next step is protecting those gains against financial threats such as too many local taxes, too many state and federal government directives, too little government collaboration and too few workers for open jobs

“There was a lot of loose spending in the early 2000s,” said county Treasurer Nancy Nix. “There was a lot of growth and a lot of money they hadn’t been used to … I think there was a lot of irresponsibility going on before what I would call the clean up team. The new wave of office holders, it was a different mentality to watch every penny.”

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In the last decade, Butler County payroll has dropped 6.3 percent, in large part because the government has 561 fewer employees. But county officials also point to cost controls and a merit pay plan that could save $120 million over 10 years.

The county’s general fund debt will have a zero balance by the end of 2020, several years after the county embarked on an aggressive debt pay-down plan. The debt a decade ago was around $92 million. The county has also built a reserve balance of around $50 million, and there is $10 million in the rainy day fund.

“With our level of personnel and our retirement of debt and increased reserves, we are positioned for the worst, better than most counties in the country,” said Butler County Commissioner T.C. Rogers. “I think we have after a number of years established a culture where our office holders and our employees are pretty much working for the same goals in the long run.”

The Great Recession caught the county and most everyone by surprise in 2008. Miami University Economics Professor Bill Even said there is some indication the economy might be slowing down, in part because the Federal Reserve has delayed an interest rate hike, but can catastrophe happen again?

“I don’t personally see any flashing red lights about a financial crisis like we had in 2008,” Even said. “But at the same time nobody really saw that one coming either.”

Commissioner Don Dixon said officials need to pay more attention to economic growth countywide, and the debt-free plan is part of that equation.

Once the general fund debt rolls to zero next year, Dixon expects the commissioners will be able to contribute $1 to $5 million annually to economy-enhancing projects in other jurisdictions. Hamilton will be the first with an already committed $2.5 million in road infrastructure for the Spooky Nook mega sports/convention complex.

Some significant businesses have been lost, including Armco. General Motors has announced it will close a West Chester Twp. facility. Dixon said the county has to set itself up to support new business.

“For businesses to grow and locate and expand it takes a good infrastructure, it takes very competitive water and sewer and gas rates and it takes low taxes,” he said. “It has to be less government interference and low taxes. It has to be a friendly, easy place for businesses to grow and expand.”

Rogers agreed economic development is crucial, but balance is needed when offering incentives.

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“There has got to be a net positive for the people coming, rather than just an announcement that somebody big is coming,” Rogers said.

Dixon said the county’s utility rates are already low to help attract businesse, but high taxes are a problem. Property taxes have increased almost 34 percent since 2007, when collections were $384 million compared to $513 million last year.

There are 135 voted levies throughout the county, everything from fire, police and roads to countywide levies for things like Children Services and Mental Health. Since 2007 voters have approved 91 levies and rejected 31 requests from local jurisdictions.

Officials say it is foolhardy to rely on state and federal funding because those sources can dry up with little warning. All jurisdictions were hard hit when the state severely curtailed local government funding. More recently, the county lost $3.2 million when a federal mandate erased Medicaid managed care sales tax on transit systems.

Dixon said officials need to come up with more regional approaches to providing services so local governments and schools aren’t constantly asking taxpayers for more money.

“We have to be smart enough to figure out a way to combine those services so we can run them more efficiently, with less people and stay within the revenues we have. Everybody can’t have everything,” Dixon said. “We have to come together and decide what is it that we can afford and how do we get there.

“Just sitting around saying, ‘They cut my budget, you’re going to have to give me more money’ to the taxpayers is not a long-term solution.”

The governments in the county already collaborate on a number of fronts, including pooling funds to buy road salt, taking advantage of volume purchasing. The fire chief’s association does the same with some equipment purchases and joint studies and the county engineer and townships partner on road projects.

The bigger ticket items, like consolidating emergency dispatching has been a harder nut to crack. The state mandated the reduction of free standing dispatch centers several years ago but in addition to the sheriff’s operation, there are still centers in Fairfield, Middletown, Monroe and West Chester Twp.

Fairfield City Manager Mark Wendling said he wholeheartedly thinks the county needs to start a renewed consolidated service conversation in many areas, but said his city’s dispatch center is crucial.

“We haven’t surveyed the residents but we do feel it is important to maintain our dispatch center,” Wendling said. “Our dispatchers are intimately familiar with the city itself, where the streets are. I think it’s important we maintain that service. We’re not in a situation where we feel we can’t afford to do that.”

Liberty Twp. Trustee Tom Farrell — the township pays the sheriff for dispatching through it’s police contract — said he doesn’t think residents care who answers their 911 call, just that help gets there quickly. He said everything should be on the discussion table, including expensive emergency services.

“Everything needs to be looked at from a collaboration/consolidation area, everything,” Farrell said. “Nothing is off the table when it comes to collaborating to see if we can increase our services to our residents at a lower price.”

Commissioner Cindy Carpenter agreed collaboration is good, but she said execution is another matter. She said history has shown the element of fairness always becomes an issue.

“Intergovernmental cooperation, you know that’s a nice buzz phrase,” Carpenter said. “But working through the details, of assigning duties and determining which local governments do what on behalf of other local governments, is going to be a very big challenge.”

New County Administrator Judi Boyko said the county needs to continue to attract good residential developments, because those residents keep small businesses like restaurants, entertainment venues and the service industry afloat.

She said officials need to look at everything, including the workforce, physical infrastructure, schools, public safety, quality of life.

“There is not just one solution,” Boyko said. “There is not one approach the county can take but the approach has to be holistic, strategic and focused on the goal, and the goal is to develop a county infrastructure, not just roads and assets but people and services and amenities, that allow the county to be healthy.”

State Sen. Bill Coley said there are plenty of good-paying manufacturing jobs in the county but not enough workers, which causes concern. He and State Rep. Sara Carruthers are working on a “true” work study program with Miami University that will allow students to work four to six days at the county’s manufacturing plants and at the same time earn tuition-free degrees, he said.

“The one thing that worries me right now is we have a workforce that can’t fill all of the jobs that we’re bringing to Butler County,” Coley told the Journal-News. “We’ve got a number of employers (that) can’t find the workers. We want to make sure they can get the workforce they need to be successful.”

Outside the box thinking is what officials say will put the county in good stead whatever the future brings.

“It’s going to take a whole new look at government,” Dixon said. “We’re gong to have to make some changes, government cannot continue to operate the way it’s running now. It’s not about us all building our own little kingdom. We’re in this together, there’s a way through it but it’s going to be helping each other and taking a different approach on how we provide services.”

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