MINUTES OF THE FORMAL MEETING OF THE JOHNSON COUNTY BOARD OF SUPERVISORS:
MARCH 2, 2009
Chairperson Neuzil called the Johnson County Board of Supervisors to order in the Johnson County Administration Building at 5:33 p.m. Members present were: Pat Harney, Terrence Neuzil, and Rod Sullivan; absent: Larry Meyers and Sally Stutsman.
Convened Public Hearing and presentation of the Johnson County proposed budget for FY10 at 5:33 p.m.
Budget Coordinator Rich Claiborne said they will be discussing County services and their cost, the Joint Emergency Communications Center budget and cost, the Conservation Bond referendum and cost, and a breakdown of tax levies and how these items are paid for. R. Sullivan said Ambulance Department budgeted expenditures are $2,951,308 which is 4.3% of the County budget. Budgeted expenditures for the County Attorney are $2,525,571, which is 3.7% of the County budget. Auditor/Accounting budgeted expenditures are $1,128,965, which is 1.6% of the total budget. Budgeted expenditures funding Block Grants including the Joint Emergency Communications Center (JECC) are $14,679,961, which is 21.5% of the County budget. The Board of Supervisors budgeted expenditures are $648,642, which is 0.9% of the County budget. Conservation's budgeted expenditures are $1,401,264, which is 2% of the total budget. The Department of Human Services budgeted expenditures are $1,527,504, which is 2.2% of the County budget. Human Resources budgeted expenditures are $278,472, which is 0.4% of the overall County budget. Information Services has budgeted expenditures of $1,056,592, which is 1.5% of the County budget.
R. Sullivan said the budgeted expenditures for the Medical Examiner are $583,065, which is 0.8% of the County budget. He said that for several years the Medical Examiner's Office has been using an employee at the University who was dedicated to Medical Examiner Services. This will not be the case anymore so the County was forced this year to hire an administrative person to work with the Medical Examiner.
R. Sullivan said Mental Health/Disability Services' budgeted expenditures are $14,117,902, which is 20.7% of the total budget. The budgeted expenditures for Planning and Zoning are $733,746, which is 1% of the total budget. Physical Plant has budgeted expenditures of $999,976, which is 1.4% of the County budget. Public Health has budgeted expenditures of $3,333,792, which is 4.8% of the County budget. The Recorder's budgeted expenditures are $614,077 which is 0.9% of the total budget.
R. Sullivan said budgeted expenditures for SEATS are $1,998,485, which is 2.984% of the total County budget. He said the County is adding a mechanic to the SEATS department, which is the only other position that the County is adding this year. He said SEATS Director Tom Brase is confident that adding a mechanic will save the County dollars so the position was approved because it is a cost savings.
R. Sullivan said Secondary Roads has budgeted expenditures of $8,456,696, which is 12.4% of the County budget. He said the County has gone through one of the most difficult 16-month stretches weather-wise. He said there is money that the County has been setting aside for a couple of years to do some capital improvement projects, but they are deciding to spend some of that to catch up on Secondary Roads projects.
R. Sullivan said the Sheriff's budgeted expenditures are $9,923,880, which is 14.5% of the County budget. He said the highlight with the Sheriff's budget is the amount of money the County continues to spend housing prisoners in other counties. That number has increased, as has travel time since the Linn County Jail is out of commission, and the County has been forced to take prisoners longer distances which costs more staff time and mileage.
R. Sullivan said budgeted expenditures for the Treasurer are $1,088,366, which is 1.5% of the County budget. Veteran's Affairs has budgeted expenditures of $99,485, which is 0.14% of the total budget. He said the State legislature passed legislation requiring the County to have a full-time Veteran Affairs Director. He said Veteran Affairs Director Leo Baier works part-time and has been able to meet the needs of Johnson County citizens. He said the Board views this as an unfunded mandate and feels that many people receive their services at the VA Hospital. He said the Board has written a letter to the State requesting an exception to the policy so that the Board doesn't have to fund the extra half-time position. The total budget for County services is $68,157,749, not including the Joint Emergency Communications Center and the Conservation Bond.
Harney said the Joint Emergency Communications Center is consolidated emergency services and will benefit all communities in the County. He said the Center will help standardize and have concise emergency dispatch procedures. There will be an ability to maintain direct contact with emergency workers such as Ambulance employees, Sheriff's employees, and EMTs. Emergency Responders will have direct contact at all times with each other on-scene, with the JECC, as well as with other emergency individuals. Harney said they will be able to maintain one center. Harney said the JECC is allowed to exist under the Code of Iowa and an agreement with Johnson County and the JECC Policy Board. The JECC Policy Board is managed through a 28E agreement with the cities of Iowa City, Coralville, and North Liberty, Johnson County, the Sheriff's Department and Johnson County Emergency Management. Iowa City has two representatives on the Joint Emergency Communications Center Policy Board, Johnson County has two, Coralville and North Liberty each have one representative, and Johnson County Emergency Management has one member. The JECC Policy Board reviews and makes all of the decisions as it pertains to the operations of the Center.
Harney said the operational expenses for the JECC are paid through the General Supplemental Fund of the County. This includes salaries and benefits, utilities, office supplies, and all of the materials they need to operate. Construction of the building and the communications equipment is funded using the County's Debt Service Levy and the General Supplemental Fund. Harney noted that construction is underway at this time on Melrose Avenue behind Chatham Oaks. It is anticipated that the JECC will open in November, 2009. Harney said the operational expenses of the JECC are $2,000,000 levied through the General Supplemental Fund at a cost of $0.387 per $1,000 of valuation. A $4,100,000 bond for the building is financed for 10 years utilizing the General Supplemental Fund at a cost of $0.092 per $1,000 of valuation. An $11,000,000 bond for the equipment was financed for 11 years utilizing the Debt Service Levy at a cost of $0.205 per $1,000 of valuation. This bond pays for radios and computer equipment for all emergency services personnel, including the fire departments in the townships. Harney said that three new radio towers will be built in order to get the coverage necessary for the operation. They will also be utilizing existing tower sites to complete the emergency communications coverage for everyone.
Harney said the Conservation Bond was approved by 61% of the voters in the November 4, 2008 General Election. The maximum bonding is $20,000,000 over a 20 year period, or as needed depending on the activity needed by Conservation. He said in FY10 Conservation is bonding $1,000,000 to be paid back in one year utilizing the Debt Service Levy at a cost of $0.1748 per $1,000 valuation. The Conservation Bond Fund was created to manage this in the future. The fund will keep track of the monies that come in and go out through separate line items in the budget.
Claiborne said Johnson County itself has issued no new debt for this budget year; however the Conservation Bond referendum and JECC are utilizing the County's Debt Service Levy. Claiborne said the County has reduced its expenses by $188,261 compared to the amended FY09 budget even amid the current economic crisis for a total budget of $84,077,446. Claiborne said that 11 operational departments have reduced their budgets from the previous year's amended budget. He said that a total of 16 combined departments and funds budgets came in lower than the previous year's amended budget. He said this was accomplished while still adding in contractual increases for personnel.
Claiborne said the General Basic Fund is where most County services are funded. The General Basic Levy is capped at $3.50 per $1,000 of valuation. The only growth in monies available in the General Basic Fund is with increased property valuation. Claiborne said the General Supplemental Fund has no cap but is very limited in its uses, such as FICA, IPERS, and the JECC. Claiborne said the MH/DS Levy varies due to property valuation growth but the tax askings are fixed at the 1997 cap of $3,138,395. He said as the valuation increases the levy drops, which is a statewide problem. Claiborne said the Debt Service Levy has limits but the County is far below the cap. The Debt Service Levy utilizes the TIF districts which spreads the burden over a wider valuation base. The TIF districts for FY10 are $721,632,375. Of the levy of $0.696 per $1,000 valuation the County's share is $0.317, with the rest being Debt Service, attributable to the JECC and Conservation Bond. Two of the County's bonds retire in FY10. The total Countywide levy is $7.39 per $1,000 of valuation, which is down $0.098 from FY09. The County's actual share of the $7.39 is $6.532. Claiborne said the Rural Basic Levy is $2.576 per $1,000 of valuation, down $0.216 from FY09.
Claiborne presented a pie chart showing the total County levy. He said that 89% of the actual County levy is Johnson County. The JECC is 9%, or $0.638 per $1,000 of valuation. The Conservation Bond is 2%, or $0.175.
Neuzil said that he will review the entire County budget and levy amounts. The total countywide levy is $7.39359, which is what all Johnson County taxpayers pay. The Rural Basic Levy is $2.57634, so the rural residents will pay a levy of $9.96993, but they don't have to pay city property taxes. Neuzil said this is one of the reasons the Rural Basic Levy is higher. Neuzil presented a pie chart of the total budget and levies. He explained that the General Basic Levy is the largest portion with a cap of $3.50 per $1,000 of valuation, or 35% of the total County levy. The Rural Basic and General Supplemental levies are each at 26%. The MH/DS Levy is at 6% and the Debt Service Levy is at 7%.
Neuzil presented a chart showing all expenditures included in the budget of $84,077,446. The chart incorporates all County initiatives including the Joint Emergency Communications Center and the Conservation Bond referendum. The largest portion of the County budget is the General Basic Fund at 55% of the budget. Examples of items funded from the General Basic Fund are the Sheriff's Department, Block Grants, Public Health, Ambulance, and the County Attorney. 17% of the County budget goes to MH/DS. Capital Projects is at 7% of the budget, or $5,803,040. A large portion of this will be used for payment of the Health and Human Services Building. The Board is hopeful that by next year the HHS Building will be paid off completely. Neuzil said General Supplemental makes up 4% of the entire County budget. Examples of items funded from the General Supplemental Fund, which has specific limitations, include insurance, Juvenile Justice, elections, and principal and interest on the bond payment for the Joint Emergency Communications Center. Neuzil said the Debt Service Levy makes up $4,145,356, or 5% of the County budget. Items funded by the Debt Service Fund are the voter approved Conservation Bond, and the Joint Emergency Communication Center equipment and towers. Secondary Roads is 10% of the budget at $8,465,696. Neuzil said that the Rural Basic Fund is 1% of the County budget, or $766,730. The Rural Basic Fund pays for services to rural residents such as libraries and landfill programs.
Neuzil next presented the tax askings. He presented a pie chart showing the tax askings for FY10, which are less revenues from other sources by fund. The chart shows only funds that levy taxes. Secondary Roads, Special Revenue, and Capital Projects do not levy a tax so they are not included. Neuzil said for FY10, even though the budget is $84,000,000, the County will only be taxing $41.7 million to Johnson County residents. The General Basic Fund is 43% of the tax askings, or $18,097,186. The General Supplemental Fund is $13,390,973, or 32% of the tax askings. Neuzil said the General Supplemental Fund tax askings are larger this year because it includes the JECC transfer. 10% of the tax askings will fund Debt Service, or $4,105,721. The Rural Basic tax askings are 7%, or $3,019,526. MH/DS tax askings are $3,138,395, or 8%.
Neuzil next presented the bottom line. He said the rollback on residential properties this year is 45.5893%, so a resident is not taxed on 54.4107% of their valuation. The agricultural tax classification is taxed at 93.8568%. Commercial, industrial, railroad, and utilities do not have a rollback and are taxed at 100%. Neuzil then presented a chart of what a person would pay in taxes per $100,000 of valuation for all the different tax classifications including ag land, ag building, ag dwelling, residential, commercial, industrial, and utilities.
Neuzil said one of the areas that has an impact is the property revaluations of the assessor's. He said a lot of people he talked to were thinking that things would stay the same because of the economy, but the FY10 budget uses property values from the beginning of 2008. Neuzil said next year and the year after revaluations likely will remain flat. Neuzil said rural ag land property assessed value decreased 1.92%. Neuzil said looking at the revaluations shows the impact on the percentage change from FY09 to FY10 in the tax bill.
Neuzil said per $100,000 of assessed value of property, the average rural ag land tax bill would decrease $9.02, or 1%. He said part of that is due to the fiscal responsibility of the Board of Supervisors, and also because the ag land values were decreased by the Assessors. A rural ag building tax bill will increase $9.12 per $100,000 of valuation in FY10. A rural ag dwelling tax bill will increase 1.6% or $7.10 per $100,000 of valuation. A rural residential tax will bill increase 2.6%, or $11.39 per $100,000 of valuation. An Iowa City residential tax bill will increase 4.7% or $15.27. A residential tax bill for other cities will increase 9.1%, or $28.22 per $100,000. Neuzil said this increase was due to the revaluation increasing 6.92% for residential properties in all cities other than Iowa City. Neuzil said rural commercial tax bills will increase 1.6% or $15.23. Iowa City commercial property will increase .9%, or $6.59. Commercial property in other cities is increasing 3.9%, or $27.46. Neuzil said rural industrial property is increasing 12.8% or $113.02 per $100,000 of valuation. Iowa City industrial properties are increasing 4.5%, or $31.82. Industrial land for other cities is decreasing .3% or $2.37. Neuzil said rural utilities, Iowa City utilities, and other cities utility tax bills will all decrease, 2.8%, 1.3%, and 1%, respectively.
Neuzil said the FY10 amended total budget is $84,077,446. The FY09 budget total was just over that at $84,195,707. Neuzil said for FY10, even though the Board has met all of the contractual needs they were required to meet and all of the demands of County government, they were disciplined to stay under the FY09 budget and were able to decrease the budget by $118,261. Neuzil said credit is due in large part to the department heads and employees of Johnson County. Neuzil said when the Board started the FY10 budget process they asked departments to try to live within their means, particularly with operational expenses. Neuzil said the Board is very proud the department heads and elected officials were able to accomplish that. He said it helped the Supervisors in their job as policymakers for County government to provide the services residents ask for.
R. Sullivan said department heads and elected officials did an outstanding job of coming into the budget season with very few requests for increases, which made their jobs much easier, and he certainly appreciates that.
Harney said the Joint Emergency Communications Center combines two communications centers, the one being managed by Iowa City and the one being managed by the Johnson County Sheriff. He said there will be a decrease in the cost to the City of Iowa City as well as to Johnson County in an amount that is close to $2,000,000. He said it doesn't necessarily save money by creating the Joint Emergency Communications Center, but the offset will be about the same because the operational budget of the JECC will be about $2,000,000.
Neuzil invited comments from the public. Roger Anderson asked what is included in the Board of Supervisors $650,000 budget. Claiborne said it is operational expenses of the Board of Supervisors Office such as office supplies, Supervisors' travel and educational expenses, and salaries, health insurance, and FICA. R. Sullivan said the personnel portion includes eight positions, five elected Supervisors, the Budget Coordinator, a Secretary, and an Executive Assistant. Anderson asked what the Supervisors' salaries are. Neuzil said the Board asked the Compensation Board for a 3% raise to mirror what the Board was expecting to give to all County employees this year. Neuzil said 3% was the recommendation from the Compensation Board and is what the Board placed in the budget. R. Sullivan said this year the Supervisors make just over $49,000. Claiborne said Supervisors will make $51,017 in FY10.
Anderson said that the budget notice in the newspaper said the average annual percent increase is 13.36% on taxes levied on property. Anderson said last year his property taxes for Johnson County increased 22%. He said if he understands what the Board has presented tonight, the County portion of his tax bill has not increased, but his taxes have increased 4.5%. R. Sullivan said the Board has to caution individual taxpayers because the most important thing is what has or has not happened in their neighborhoods regarding assessments. R. Sullivan said when the Board gives numbers they talk about a vague $100,000 home because the biggest individual impact is what happens with valuations. He said it really depends on where the taxpayer lives and what they own. Anderson said what he was told in the past by Neuzil was the Board holds budget public hearings and no one comes. Anderson said he decided to come to the meeting because he doesn't want to get the same shock with his tax bill this year as last year. Anderson commended the 11 departments that decreased their budgets. Anderson said all governments should budget by looking at how they can decrease their budget and not increase their budget. Anderson asked if the Iowa City budget is completed. Neuzil said the 2008 Assessor revaluation went up 2.62% for residential Iowa City tax bills, so a $100,000 tax bill would increase $11.39. Harney said the Board doesn't control what Iowa City budgets. Anderson said he came this evening because his County budget increased 22% last year and the City portion of his bill only increased 14%. Anderson said if he found out at the meeting that his County taxes were going to increase he was going to ask what would happen if the County gets the new jail, the City gets the new fire station, and the School District wants to build a new school. Anderson said in Iowa City a majority of employees are getting minimal or no raises. Anderson said he is retired and his retirement savings has decreased over 50%. He said there is a limit to what people can pay, even for those who have never failed to pay their taxes or their mortgages. Neuzil agreed. He said when starting the FY10 budget process, the Board started communicating with department heads as early as July and August about the economy turning. He said that is one of the reasons they asked for operational expenses to be frozen. Neuzil said the Board had a lot of budget requests, particularly for employees, and they had to say no. Neuzil said Anderson's point is well taken. He said what happened last year was a perfect storm of Iowa City and the Iowa City School District increasing taxes, and Johnson County adding the Joint Emergency Communications Center to the budget which had a large impact for residents and is why the Board tried to cut the budget this year.
Anderson said he had always thought of block grants as something that came in from the Federal government. Neuzil explained there are two kinds of block grants, expenditure block grants and revenue block grants. Anderson said residents are also going to be asked to increase the sales tax again. He said taxes can't increase to the point where people can't afford them. Neuzil agreed.
Mid-Eastern Iowa Community Mental Health Center Executive Director Stephen Trefz asked if the Supervisors knew what they were getting into when they became Supervisors. Neuzil said this has been the toughest budget year for the County because they've had to cut way back. Trefz agreed. Neuzil said the Board will be cutting more next year. Trefz suggested for next year the Board begin looking at administrative cuts in the MH/DS budget. He said he would like to explore the MH/DS relationship with the State. He said the State has never followed through with their obligation. He said to get the State's money they have to do a lot of reporting and administrative services. Trefz said they've been looking for a long time for a uniform cost report. He said providers and MH/DS could fill out one report as opposed to multiple reports. He said this would be one of the areas that they could cut costs without cutting services, but given how things unfolded this year they've had to cut services. Trefz suggested in planning for next year they should begin negotiating and suggesting to the State that the County will be making its cuts based on the obligations they entered into. Trefz said one of the things they are going to look at from the provider level is layoffs. He said with the type of cuts that they are suggesting, worst case scenario, they will be laying staff off. He said providers and MH/DS have had a fairly collaborative organization so if providers look at laying off staff, he would suggest the County look at laying off staff too. Trefz suggested if they look at the rate freezes they need to look at salary freezes since it comes out of the same pot of money. Trefz said that will be a decision for the Board but he wanted to suggest it. Trefz said when providers and the County get in touch with local legislators they need to hold their feet to the fire regarding the State's obligation. Trefz said he knows it is difficult for the State to give money they don't have, but they can release local providers and the County from some of the administrative obligations they impose. He said it won't cost the State a dime but will save a dime at the local level that can be put into services. Neuzil thanked Trefz for his comments.
Neuzil said the Board will be voting on the proposed FY10 Budget on March 12, 2009 at 5:30 p.m. Neuzil said the Board cannot increase the budget at this point, but can still decrease the budget. Neuzil said the Board will be working extremely hard over the next year on budgeting strategy. He said the Board has stopped the strategic planning process of working on specific projects and instead is focusing efforts on the budget. Neuzil said the Board will be working with the Human Resources Department to identify employee challenges to look at the process and get policies in place for furloughs and layoffs. Neuzil said the Board will then be looking at other areas as well and will have a better picture in the future when they get assessment information in. He said they've been meeting regarding the future budget during Strategic Planning Work Sessions and with the Finance Committee.
Harney thanked all of the department heads and employees. He said they've held to the budget and found ways to manage even though there are shortcomings that have occurred during the last couple of years with the weather conditions such as the long winters and the flood. He said departments have pulled together and have done an excellent job for the citizens of Johnson County. Harney said there is still a lot to accomplish. He said Secondary Roads used a lot of their reserves and they need to try to replace them, but yet they are holding the budget flat and it will be flat next year as well. Harney said if everyone works together they will get through the tough times.
Neuzil encouraged the public to visit www.johnson-county.com to view the proposed FY10 budget.
Public Hearing closed and meeting adjourned at 6:18 p.m.
/s/Terrence Neuzil, Chair, Board of Supervisors
Attest: Tom Slockett, Auditor
By Casie Kadlec, Deputy Auditor
These minutes were sent for publication and formal approval on March 12, 2009.
Sent to the Board of Supervisors on March 11, 2009 at 5:30 p.m.