County budget woes end
Butler County’s cash flow won’t be clogged anytime soon.
County Commissioner Leslie Osche, board chairman, said there would be no problem paying bills and payroll for the remainder of the year.
She said a 2017 property tax hike is not on the table.
“That will not happen,” Osche said.
She said even when the county might reach a point in future years when a tax increase could be beneficial, both options — increasing taxes to resolve an issue or maintaining the millage rate — would be presented to the public at that time.
The county raised taxes by 3 mills this year.
County Controller Ben Holland agreed there should be no need for a tax hike in 2017.
“I think that should be automatic,” Holland said.
He said if the county continues cutting expenses as was done this year after the 2016 budget was approved, the level of revenue should be sufficient in coming years to avoid tax increases.
Although Osche said Butler was a long way from having problems as severe as Beaver County, where drastic cuts were made to offset a $6 million deficit at the beginning of the year, the ship needed to be righted here.
Holland said if the county was not cutting costs and ended in the red, a deficit would only grow.
“It’s the snowball effect,” he said. “It compounds. It would not take very long.”
Holland said a $2 million deficit one year would increase to $4 million the following year.
“You can only borrow so much,” he said.
He reiterated the county prevented a deficit at the end of 2015 by transferring $2.5 million of natural gas drilling impact fee money into the general fund.
“It was the only thing saving them in the end,’ Holland said.
Former county Commissioner Bill McCarrier, who was chairman of the prior board, previously said the county’s fiscal state last year was not as bleak as portrayed by current officials.
McCarrier then said such transfers would occur regardless, so the move should not be considered a desperation measure.
Holland said he considered that use of impact fee revenue as a waste.
“That was squandered because there was nothing to show for it,” he said.
Osche pointed out the county is in better shape than last year.
She cited the current $16 million in cash being ahead of the $14 million in the coffers at this juncture in 2015.
The $14 million number includes the $7.5 million the county owed for the 2015 tax anticipation note (TAN), money borrowed to pay bills until first quarter taxes are collected.
Osche stressed the county already repaid the 2016 TAN.
Commissioner Kevin Boozel agreed that paying off the TAN was significant to the bottom line.
“That’s a big deal,” he said.
Boozel said the county would have a better handle on how much it needs to borrow in 2017, so only what’s actually needed would be secured.
Holland credited the commissioners for cutting costs and potential expenses, including the elimination of 26 vacant jobs last month.
“It’s a big step in the right direction,” he said.
Osche said the move was necessary.
“It removed the temptation to fill the positions,” she said.
Holland agreed.
“It took a lot of positions off the table before anyone could get them,” he said. “It sends a message we’re not creating any new jobs.”
Holland said the next step is to consolidate positions to save actual money, not just freeing up allotted money in the budget.
However, he said the practice of not adding posts already has helped the county.
Holland cited salary costs only rising 3.5 percent — the same amount of the mandated raise for union workers — since last year.
He emphasized salaries alone comprise 40 percent of the county’s total $150.6 million budget. Including retirement and health benefits, that number rises to 55 percent.
Osche said the county continues to meet all scheduled payments to organizations such as Butler County Community College receiving contributions included in the 2016 budget.
Boozel said delays in making those payments adversely affect those entities.
“It’s a bad place to put an agency,” he said.
Osche and Boozel also questioned the practice of constantly transferring money from one fund to another.
“It does skew the bottom line at the end of the day,” Boozel said.
The commissioners also want to eliminate the vaguely titled “miscellaneous” line item.
Osche said that is why a county contingency fund exists — to address unforeseen expenses.
As the county focuses on 2017 budget preparations, the commissioners agreed using actual, rather than roughly estimated, numbers would greatly enhance the process.
Osche said department heads and row officers now have precise personnel costs, including health care, when discussing their proposed budgets
“Those numbers will be right,” she said.
Osche said the county still might give nonunion workers a lump-sum payment later this year in lieu of a pay increase, which the county calls a cost-of-living adjustment, that they did not receive in the 2016 budget.
Although some fiscal strides were made, Osche said this is just the beginning.
“There’s a lot of work to do,” she said.
