On Feb. 16, DeKalb CEO Burrell Ellis increased his proposed budget by $12.2 million to $559.5 million, up from the $547.3 million he sent to the Board of Commissioners on Dec. 15.
The adjusted 2011 tax funds budget adopted last July was $540.4 million.
The board’s Finance Committee met twice this week to review the CEO’s amendment and to discuss some of their own proposed changes.
Committee members Lee May, Sharon Barnes Sutton and Elaine Boyer will meet on Feb. 27 to make their final recommendations before the full board votes on Tuesday.
In his amendment letter, Ellis notified the commissioners that there was an additional $12.1 million carried over from last year’s budget.
“This increase in cash available was, in part, a result of stringent control of filling vacancies, which my administration will continue to maintain in 2012,” he said.
Chief Operating Officer Richard Stogner said the $12.1 million did not come from new revenues but from “squeezing” out savings under last year’s budget.
When the 2011 books were closed out in mid-January, there was $31 million in the fund balance that carried over to 2012. Originally it was expected to be about $18 million.
Finance Director Joel Gottlieb said $7 million from the $12.1 million was added to reserves in the budget, bringing them to about $30 million.
The other $5 million was appropriated to correct problems identified during recent budget meetings with department heads and constitutional officers.
The “new money” came just in time.
The Finance Committee voted to use $2 million from fire fund reserves to replace air packs used by firefighters to help them breathe in burning buildings. The firefighters union had complained that the air packs have malfunctioned on the average of once a month and that 330 packs should be replaced as soon as possible.
The CEO’s amendment letter said the administration would develop an RFP for new equipment, explore the sale of old equipment and phase in the new equipment, but it did not specify an amount of money.
“Under a lease purchase agreement, we could replace all of them but pay about $700,000 per year for three years,” Stogner said.
The biggest surprise in the amendment letter was the news that the health insurance claims for employees and retirees surpassed the 2011 budget by $8 million.
The amendment letter also sought to pay these claims and to put $2 million into the reserve for group health insurance for 2012.
Larry Jacobs, the county’s deputy director for risk management, said the actuaries projected claims would total $82 million in 2011 but they came to $90.8 million.
“If there hadn’t been the $12 million end-of-the-year find, what would have been our plan?” Boyer asked. “That is like a 20 percent mistake.”
May said the administration should have seen that the amount of claims was above average each month and should have notified the commissioners earlier.
“We need to do a better job monitoring the claims and informing the board,” Stogner said. “It won’t happen again.”
On Feb. 21, the Finance Committee recommended taking $8.8 million from the general fund reserves and using it to increase the reserves in major tax funds, including police and fire funds, by 4.9 percent each.
Gottlieb argued against this, saying that “rating agencies look at the general fund and compare it with other governments. Spreading the reserves diminishes funds available.”
Moody’s has given DeKalb the highest rating for short-term bonds in connection with the sale of $157 million in tax anticipation notes on Feb. 28. The notes will provide the county with cash flow from March to September, when property taxes will begin coming in.
The Finance Committee also voted to recommend eliminating the director of public safety position as of April 1 and to cut the $149,247 that funds the position from the police budget.
Some commissioners opposed the creation of the public safety director as part of the CEO’s Cabinet in 2009, saying it diminished the role of the chief operating officer.
The board has said in two budget resolutions it did not intend for the position to be funded, but the position appears on a list of authorized positions in the 2012 budget.
William “Wiz” Miller, who holds that title, was appointed E911 director last April and is paid from the E911 fund.
May said he was OK with Miller being the E911 director.
Another objection to the CEO’s budget has been the inclusion of $4.5 million in revenue assumptions that still require action by the commissioners and/or state legislators. These include $1 million from a 3 percent increase in the hotel motel tax in unincorporated DeKalb, which the commissioners deferred until Feb. 28; $2 million from increased fees at the Recorders Court; $500,000 from increased utility cut fees; and $1 million from new fire inspection fees.
The commissioners deferred until Feb. 28 a resolution calling for the local delegation to pass legislation to allow the hotel motel tax increase. State Rep. Michele Henson introduced HB 1113 on Feb. 21. It would authorize DeKalb’s governing authority to levy a hotel motel tax up to 8 percent.
The county’s lobbyist, Bruce Bowers, told the Finance Committee on Thursday that another piece of local legislation that would increase fees in the Recorders Court was being drafted. He was confident both bills would pass but that might not happen until near the end of the legislative session, after the budget adoption.
Also on Thursday, the Finance Committee voted to restore $512,000 to the roads and drainage budget to pay for paving materials, to increase senior services purchases and contract services to the 2011 level, and to allocate $180,000 to the District Attorney’s Office for a grand jury investigation of the Watershed Department.
In a Feb. 22 supplemental amendment, Ellis increased the appropriation for senior services by about $364,000 and appropriated $280,000 to the district attorney for two grand juries related to public integrity.