That’s why he and Domestic Relations Court Judge Sharon Kennedy three weeks ago convened a group of local officeholders, department heads and business leaders. Their newly formed Budget Work Group — which sprouted from a decision last month by commissioners to enact across-the-board cuts that exceeded $2.6 million — is trying to come up with a blueprint to head off future financial crisis.
Commissioners Gregory Jolivette and Charles Furmon approved the cuts July 16, believing they would allow the county to keep its head above rough water now and in the future. However, more cuts are expected by the end of the year, and additional reductions are forecasted next year as revenue could be nearly $10 million below 2008 levels, county projections show.
It’s a perfect storm that’s been perpetuated by denial, Dixon said.
“We have the equivalent of a Category 5 financial hurricane headed our way, and if we choose to ignore that reality, our county will be in financial ruin,” he said. “We cannot continue with business as usual. It’s a recipe for disaster.”
But not everyone agrees.
“It’s not doom and gloom in Butler County,” said Gregory Jolivette, who noted he plans to attend future Budget Work Group meetings. “I’m not saying we won’t have to make some tough decisions, but it’s not something that we could have foreseen. I think it’s a little disingenuous to say that.”
The Budget Work Group is seeking input from all sectors of the county in an effort to educate office holders and the public, and to plan for a sound financial future.
“We need to take a household approach,” said Kennedy, who is spearheading the budget analysis effort. “If we don’t come together and understand all of this, none of us are going to make it.”
Group proposes ‘drastic overhaul’ of county government
In a budget crisis, Butler County commissioners have two traditional choices: Enact sweeping cuts that could affect services, or use up cash reserves.
The latter option could leave them unable to cut payroll checks as early as the end of the first quarter and jeopardize their ability to borrow money for important projects, according to county finance officials.
But a newly formed group says there’s a third option: Drastic overhaul, cutting what they say is a budget that has grown bloated and unwieldy.
A national recession has — as with everyone else — brought the county to its financial knees. Revenues are down nearly $10 million — or approximately 10 percent of the county’s budget — from last year’s levels.
Officeholders are still struggling with nearly $2.6 million in cuts commissioners approved last month with a contentious 2-1 vote. Those cuts slashed the Board of Elections budget by 13.5 percent, and forced layoffs of sheriff’s deputies and court staff, among other areas.
The Budget Work Group, consisting of department heads, elected officials and county business leaders, says that was merely a stop-gap.
“That was taking a 2,000-pound grizzly bear and poking him in the eye with a stick,” said Commission President Donald Dixon, who voted against the July 16 cuts.
They want reform.
Budget group agenda: Reform
The Budget Work Group, spearheaded by Dixon and Domestic Relations Judge Sharon Kennedy, has been crunching numbers since the July 16 meeting, coming up with new ideas to stave off financial disaster.
“If we don’t manage these cuts, somebody from Columbus is going to come down here and manage it for us,” Dixon said. “You better put all the cards on the table, and you better be dealing straight.”
They advocate cutting staff, travel and fringe benefits. They want to consolidate departments, including human resources, information systems and purchasing. They want to combine area and municipal courts. And much more.
This includes a hard-nosed stance with employee unions, which have driven up the cost of county government in recent years with some contracts guaranteeing 7 percent annual pay raises.
Central to this is an unprecedented level of communication among offices and with the public about the budget instead of heavy-handed across-the-board cuts.
“We’re lopping off limbs every so often, instead of saying we need to get to a specific number,” Kennedy said. “I want the county to emerge stronger and with a plan that we don’t ever see ourselves here again.”
2010 forecast grim
With plans to drain $5 million from the county’s cash reserves this year, officials believe they can make it through December.
But that leaves only $8.5 million left in reserves. And if the budget stays the same at $89.7 million — and revenues stay at $84.2 million — cash-flow issues and other factors could see the reserve fund emptied in 2010, according to Pete Landrum, county budget and management director.
“Nobody really knows where the bottom is or if we’ve reached the bottom yet,” Landrum said. “I just don’t see any improvement in 2010.”
Sales tax revenues are down 10 percent — twice what was expected — and next year’s forecasts are just as gloomy.
“Should sales tax revenues remain stagnant or continue to decline, the county will likely face a significant budget gap as other county revenues are either flat or declining,” says a report by Moody’s Investors Service dated four days after the July cuts.
Moody’s is keeping a close eye on the county. And should cash reserves stay below a mark commissioners set for themselves of 15 percent, the credit-analysis service stands ready to downgrade the county’s credit rating.
“Moody’s expects many of the county’s revenue sources to remain pressured in ... 2010, requiring additional budgetary action by county officials,” the Moody’s report says.
Contact these reporters at (513) 820-2112 or dgreber@coxohio.com, or (513) 820-2175 or jsweigart@coxohio.com.
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