Vice-Chairperson Neuzil called the Johnson County Board of Supervisors to order in the Johnson County Administration Building at 9:12 a.m. Members present were: Mike Lehman, Terrence Neuzil, Sally Stutsman, and Carol Thompson; absent: Pat Harney.

Budget Coordinator Jeff Horne said that for the 3 years he has been involved in the budget process, the 1st year he observed, the 2nd year he learned the operation side and this year he is trying to institute process changes that should benefit the Board and County. He said the objective of tying the strategic planning to the budgeting process is to allow funding to follow the priorities of the Board of Supervisors giving the County a more efficient budget process. Horne organized the budget meetings into the service areas the State defines: Public Safety, Court Services, Physical Health and Education, Mental Health, Social Services, County Environment, Roads and Transportation, State and Local Government Services, Interprogram Services, and Capital Projects.

Horne listed the elements of Public Safety: Ambulance, County Attorney, Sheriff, block grants for Emergency Management and Haz-Mat, Medical Examiner, Juvenile Crime Prevention, and some special revenue funds like law enforcement proceeds and forfeiture funds. He said the Court Services area includes the County Attorney, Juvenile Justice Administration, and the Sheriff. He explained that Capital Projects include County buildings and facilities, technology and road projects. He said when the County does the forms the State counts the road projects in Secondary Roads the same way the County counts their capital projects on buildings. He said that the Roads and Transportation Area is Secondary Roads’ operations. Horne explained that the County environment includes Planning & Zoning, general basic block grants for any economic development like ICAD, as well as Conservation. He said the Mental Health services area is the Mental Health/Developmental Disabilities Department. Included in the Social Service area is SEATS, general basic block grants for human services agencies, Department of Human Services, Department of Veterans Affairs, institutional accounts for chemical dependency commitments, and the Juvenile Youth Home. Thompson asked if SEATS should fall under transportation. Horne replied that if they considered it a true transit system it would fit under Secondary Roads, but they count it as a social service. He said he didn’t know what would be required to count SEATS under Secondary Roads. He said they would have to check the chart of accounts in the Auditor’s Office, but previous Boards had designated it a social service. Horne said that Health and Education includes the Department of Public Health, general basic block grants like VNA and Free Med, and Rural Basic block grants for libraries, soil and conversation. Interprogram services includes the Board of Supervisors, Human Resources, Information Services, Physical Plant and things in Central Services like the Communications Committee or the County’s Insurance Committee. Horne concluded that they need to focus the process on the service area at the departmental level and link the strategic planning, budgeting and outcomes. Horne said that he has organized the meetings by service areas. He said Friday they will start discussing public safety minus the County Attorney and Sheriff because elected official’s presentations would be on a different day.

Stutsman asked Horne what he wanted the Board to have prepared. Horne replied that he was waiting on the Auditor’s Office for the payroll numbers so he will not have a budget prepared until then. He said they will not be able to set COLAs before the Board has to approve the budget. Neuzil asked how are they going to set the budget if they don’t know what the union contracts are going to be. Horne said they Board will probably have to have a budget in place before the contracts are settled because of State deadlines. Thompson said they have done this before. He said the Board will still have flexibility through amendments. Thompson said if they put COLAs in place they would have problems with the bargaining process. Neuzil said that was his point, but to put a budget in place they would have to have COLAs set. Stutsman replied that they can do different scenarios based on different COLAs. Stutsman said if there is no money, then there is no money. She said if the County is expected to give a certain level of COLA, then the Board has no options unless it wants to raise taxes. She suggested that the Board should discuss today where they want to be with taxes, at a steady level or have the flexibility to raise taxes. Thompson asked if the rollback had any affect this year. Horne replied that it was minimal this year because the residential went down, but the commercial went back up.

Neuzil asked Horne if the Board would have funds available. Horne said the biggest impact would be from the 15% increase in health insurance again this year which will be another $350,000 to $400,000 in taxes. Thompson asked Horne to explain the budget in terms of every percent of increase would equal X amount of dollars. Horne said when he gets the payroll numbers he can give the Board that information. Neuzil asked if $400,000 is the total cost of insurance. Horne replied that the cost of insurance is $3 million already. He said in the 3 years he’s been with the County, the health insurance has gone up 20%, 17% and 15%.

Horne explained the different levys. He said that employee benefits is in the Supplemental levy normally, however that still affects taxation. Thompson clarified that they would have to lower the General Fund in order to offset the increase. Stutsman added if they wanted an even tax level. Stutsman asked if there were limits on the Supplemental levy. Horne explained that the Supplemental Levy is only limited by item, for example FICA, IPERS, health insurance, property and casualty insurance, elections, Juvenile Justice Administration all fall within the Supplemental fund. Stutsman asked if last year the Board put everything they could into the Supplemental Levy. Horne said that last year they used the debt service levy that allowed the Board to spend for several of those things out of that levy. Stutsman asked if the Board has transferred everything they could into the debt service levy. Horne said yes and explained that the debt service levy allows the County to levy without referendum for things that are identified by the Code of Iowa as essential County purposes. He said last year the County used the debt service levy because it allows them to tax across TIF districts, which spreads the taxes out over a bigger base of taxation. Thompson said last year that was a good idea because interest rates were low and added that interest rates are still low, so she asked the Board if they want to continue that approach. Stutsman asked Horne if it was to the Board’s advantage to continue. Horne replied that they should take a look at it, but when he gets the payroll numbers he will figure it out without the Debt Service levy and see. Thompson said the results of the IRS audit might influence the Board’s opinion. Horne explained that the IRS is doing an audit of the County’s taxable bonds. Lehman said the audit is only a spot check, so there was no reason to think there would be a problem. Horne said the IRS was interested because some of the bond issue was taxable and some was nontaxable, which was kind of unusual. Stutsman said that everyone that does taxes knows that a red flag goes up when something different is done. Thompson noted that the County will incur more cost from the audit.

Neuzil asked Horne what the trends are with the General Fund. Horne thought they will be better in the General Fund. He said the revenues continue to do very well, which has helped the County’s reserves. Horne said with the Board instituting last year’s 4% cut, departments are closer on the expenditure side this year. Horne said he doesn’t think they can raise the revenue expense adjustment again, which would lower tax askings in the General Fund. He said the General Interest expense, which was deducted last year won’t lead to as big of a fall because it’s already built into the budget. He clarified that any future losses of interest revenue is now built into the budget. Thompson said that the County doesn’t have any long-term CDs. Stutsman said where you get an advantage in one area, there is a disadvantage in another area. Horne said the County doesn’t issue debt generally, so they are unable to take advantage of it that much, except for last year and possibly this year. Horne commented that he has already had a meeting with Springsted and Associates Representative Tony Roetlin and identified some things.

Neuzil asked what the Assessors are predicting at this point. Horne said the changes in valuation won’t be ask much because this is the odd year. He said next year’s impact would be larger. Neuzil asked if the County grew. Horne replied that the County grew 3% and TIF areas increased 12%. Neuzil said TIF area growth doesn’t help Johnson County. Horne said the TIF creates some value, but being generous, 30% of the amount is normal valuation growth. He estimated that 1/3 of $370,000 is probably what the County is losing. Neuzil asked if they thought the General Fund was going to grow at roughly 3%, yet the Supplemental is going to go up because of health insurance and other factors, then it seems the Board can’t go above 3%. Stutsman added, not without raising taxes. Neuzil said they may not be allowed to. He asked where the General Fund caps. Horne replied that the County is close to the cap, but shouldn’t go over it this year. Thompson said the cap will hit 3% higher then it did last year because that’s new valuation. Neuzil asked if the Board chose to go above 3%, which would be eaten up in salaries, then he thought that should be the top end of what could be allowed. He also said there were some things that could probably be cut if needed. Horne said that the whole point of the meeting is to prioritize. Stutsman added that it was easy to say cut, but what would be cut.

Horne asked the Board to look at the bigger picture and questioned what the Board wants to prioritize. He said last year they made across the board cuts, but maybe this year they could focus on what the Board really wants to prioritize. Stutsman said her ultimate goal is to avoid another across the board cut. She wants the Board’s cuts to reflect a discussion of the Board’s priorities. Thompson said the Board has their list of non-essential purposes that they were looking into. She said she would like to focus on those things. Stutsman said she wants to get back to the bigger discussion of the role of County government. She said that the Board keeps hedging on that. Thompson said that was it, if it was the collection of non-essential purposes or some other one. Stutsman said she thought Thompson had said that she wanted to eliminate the non-essential purposes and just start there. Thompson said she didn’t, but she thought they should be talking about them and Stutsman agreed. Stutsman said the Englert discussion comes often, which she has a problem with because on one level the Board talks about having more of a presence on economic development, but then the Board isn’t willing to fund it. Horne said that is included in the County environment service area, which is where they will focus in on the question of how active the Board wants to be in economic development. Stutsman said it is similar to the fact that they’ve always been very active in human services. She asked if that is the direction the County wants to continue to go and if so, what kind of accountability is required for funding. Neuzil added that the proof is in the details when for example there’s a 3% increase and the Board told the Senior Center they would get cut 30%. He said they were trying to be fair and consistent, but if that is the priority then that’s the priority.

Horne went over the upcoming budget meetings schedule. Horne said the Board has to have a budget by mid-February because there has to be a public hearing set for early March, passed by the Board, certified by the Auditor and to the State by March 15th.

Horne asked the Board if there is anything they would find helpful from him during the budget process. Stutsman said every year she is concerned about communication with department heads and elected officials. Horne said that he wants to communicate with departments, but on the other hand doesn’t want to rattle people’s cages until the budget is set. Stutsman said it is a terrible dilemma because invariably one department head gets wind of something and starts lobbying the Board. She said she wants a level playing field for everybody. She said they hear that complaint every year from elected officials and department heads, that they never know where the Board is at until the very end. Horne replied that he had met with them all so far this year and he told them what he thought the County budget was going to look like in general. He said he didn’t think the departments would be tremendously surprised. Thompson said if the department heads and elected officials see the schedule, then they’ll know what day they’re being discussed. She suggested at the end of each day, Horne call each one and giving them a summary. Horne noted that for some of the larger discussions, he will be bringing in the department head like County Engineer Mike Gardner for road projects. He said he wanted to talk about the 5-Year Road Plan and how the County budgets for it. He said he would like to bring Mental Health/Developmental Disabilities Director Elaine Sweet as well.

Neuzil expressed concern over budgeting too much money early in the process and not having funds available to allot later in the process in February. Thompson said during the last days the Board would need to delete things. She added that that was the reason Horne didn’t want to raise department’s hopes. Horne said if he could get the payroll numbers, they could discuss that at the end of each meeting. He said that the Board needs to keep in mind the 3% and be consistent across the areas. Stutsman said she wanted to hear everybody’s proposal and weigh it at the end. Neuzil agreed and said that was why he asked what was going to be done during the budget meetings. He said it sounds like the Board would be making decisions. Horne said they could make decisions during the meetings, but that there is nothing to stop the Board from changing its mind. Stutsman said that everything would be subject to change.

Neuzil suggested the Board’s discussion should be about the major changes taking place in some of the departments, primarily adding employees. He said that is something to think about before the first meeting even, whether the Board wants to increase Johnson County employees. He said last year they were discussing layoffs and now there are requests for increasing employees. Horne said that one department asked for several, but most did not. Stutsman said for the one department asked for 2 employees because they can save money through less overtime. She said that could be a good investment. Horne said the Ambulance Department’s request is warranted because he’s getting increasing calls to the north and west sides. Horne said the Ambulance Director is in discussions with Coralville for permanent housing so he will be able to cut down overtime, but he’s getting increased call fees so it’s pretty close to revenue neutral. Neuzil said that was something to factor in. He asked if public safety was more important than something else on the list of areas. Stutsman reiterated that the question was one of County government’s role. She said she wanted to put their money where their mouth is by reflecting the Board’s priorities in their budget. Horne said that was the goal.

Stutsman asked Horne about duplication of services, including GIS in different departments. She said she noticed that the Auditor’s Office requested an additional deputy for GIS and she is not clear if there is a duplication of services. Stutsman said they can’t afford that kind of duplicity. She asked if anyone else knew of any other areas of duplication of services. Thompson said the GIS department has a time schedule of how they plan to bring the various departments online and it’s possible that as they do that, those departments will want more help to do data entry. She said the Board has to decide whether the staff that used to be doing it the old way could do the GIS or if new staff is required. Thompson said GIS Coordinator Rick Havel could give the Board some insight on that. Horne explained that that elected officials have discretion with what they want to do with their deputies. He asked if the Board wants to fund a deputy for minutes. Stutsman said the elected officials have the authority to do what they want with their budgets, but the Board sets the budget. Horne said that once the Board sets a deputy, it’s there. Lehman said one confusion with GIS is that the County has a GIS Coordinator under Information Services, but the Auditor is asking for a GIS Deputy. He said it’s hard to understand if it’s a duplication or if that person is going to be doing GIS information full time or helping the Auditor in other departments. He asked if the Board would lose control of that individual because they are giving dollars to that person. Stutsman asked if the GIS function could better serve the County centralized versus every office having a GIS Deputy or Coordinator. She said she didn’t know, but she needs to have those questions answered. Horne said this was a chance for the Board to think about the structure of GIS and decide what’s most efficient.

Neuzil expressed concern over the trend that those departments who have fees are now thinking that it’s their department’s money. He recommended the Board be careful because there are a lot of departments that don’t bring in any money for their services provided. Lehman said there are departments like the Recorder where the process starts by collecting a fee, another department like the Auditor’s department has to do a lot of the legwork, but they don’t get credit for the revenue. Thompson said over the years the Board has tried to let the departments know that they don’t own the revenue and it goes back to the General Fund, but they sent a mixed message last year when they didn’t give the 4% cut to the Recorder. Stutsman said the Board sends the same message to the Conservation Department who also collects fees, because historically the Board has turned around a given the fees back to them. Stutsman said she wasn’t saying whether that was right or wrong, but it is a policy decision the Board makes. Neuzil said it was hard for him to compare apples to apples there because Conversation has their own Board and to him that was an incentive to Conversation to make their parks better because the department gets to keep their fees. Thompson said the other side of the coin is do they wanted the departments to all start charging fees so they will have more money. She said the Board has encouraged some departments to do that, but others the Board might not want to. Horne said some departments have raised their fees. Neuzil said they also didn’t know what fees would be implemented for GIS. Horne said that Havel is close to arriving at a fee schedule. Neuzil said it sends a mixed message because taxpayers paid for the product, but the County says they must pay a fee to use it. Horne said that whenever a fee is charged it lowers taxation. Neuzil added that unless it’s the person that needs it. Thompson said with GIS, the people that would be paying the fees are using the product to make money. Neuzil said it is a tough question. Stutsman said that fees are set when it’s beyond the normal realm of service. Thompson said the County doesn’t charge people who live on hard roads more than they charge people that live on gravel roads. She said they don’t charge people to use the libraries even though the County pays more than is required. Neuzil said that was another subject they need to keep in mind. Stutsman said it again goes back to the role of government.

Neuzil said he also wanted the Board to talk about the direction of the Rural Fund, which they had been discussing over the last 6 months. He asked if the Board wants to shift things in that fund this year. Thompson explained that there were 2 parts to that question, because each year the Board must set the amount of road funds they take out of the General Fund versus the Rural Fund. She said how that is balanced means how much taxation there will be in the Rural Fund. She said they’ve tried to change that various years to offset the equalization. She said there was a question of adding things to the Rural Fund that would increase taxes. Neuzil asked if that was something the Board wanted to do. Horne said the libraries are the biggest item. Neuzil said the Rural Fund is basically roads and libraries, but it seems through different court cases that the County can add more things as long as they are for the essential purpose of rural people. Horne said that the Code is very ambiguous. Stutsman asked if Neuzil was talking about putting the Sheriff’s patrol in the Rural Fund. Thompson added the Senior Center. Horne said the Senior Center would be only if the Board did rural only. Stutsman said she would need to see the impact that would have on the rural taxpayer because there is a smaller amount of taxpayers for that increase to be absorbed by. Horne said the number of rural taxpayers continually shrinks. Stutsman said she wasn’t ready to make that decision. Executive Assistant Mike Sullivan added that it might impact the Sheriff’s Department as far as tracking goes because it will need to be broken out. Horne added if it brought in the revenue from the contracts for patrol for small towns there would be an incentive. Thompson replied that the County would have to show that the revenue the towns paid was their actual cost. Neuzil noted that the Sheriff increased the contracts. Thompson said they’re not sure what the correlation is between the actual cost to do the service and what he’s charging. Neuzil said he didn’t think that was tracked. Thompson asked if they were allocating things like Carpenter’s salary out over the various functions they do or if they were including the building costs into the contracts. Horne said it was mostly payroll, fuel and vehicles and Stutsman added it was the cost of doing business.

Lehman said they’ve been discussing a fee for Senior Center members. He said if the Board takes Senior Center funding out of the Rural fund, then the other incorporated entities are off the hook unless the Senior Center can work out some type of fee. He said that can be argued all day long and any steps the County takes might diminish the Senior Center’s leverage in dealing with Coralville and North Liberty. He explained that if the Board takes the funding out of the General Fund, then everybody pays, but Iowa City pays twice. He continued saying if the Board takes it out of the rural and if the Senior Center doesn’t get any negotiations done with North Liberty or Coralville then they got off the hook unless a user fee is implemented. Thompson said it would keep up the pressure. Lehman said he wants to keep the pressure up. Stutsman said she thinks the Coralville constituents need to go to their City Council to say they want their taxes to fund the Senior Center. Lehman reiterated that he doesn’t want to ruin the Senior Center’s bargaining power. Thompson said that implies funding it out of the Rural Fund, which she and Neuzil agreed with. Lehman added that then there will be less people to make up the tax difference.

Neuzil asked if Horne had library trends available. Horne said he didn’t receive requests this year from all the libraries. Stutsman asked if they were assuming it’s based on the Iowa City contract. Horne replied that they shouldn’t assume because the County doesn’t have a formal contract with them. He said Iowa City is required to give the Board their number by January 20th. Neuzil said in the meeting he and Horne had with the libraries, they gave them a heads up about funding changes that might or might not happen this year, but definitely will come up. He said the Board really needs to think about the future of library funding in Johnson County to decide what they can and cannot afford. Horne added that there is a new library request this year as well from Tiffin. Stutsman said she doesn’t understand how the County can be spending money on libraries without contracts, and Thompson agreed. Horne said they have to give them money according to the Code of Iowa. Thompson said they don’t have to give them the amount they want. Stutsman said they pay over and above and it is not based on a contract. Horne said that it was based on an implied contract, to which Thompson replied there is no such thing as an implied contract. Horne replied that every library but Oxford is following the Iowa City contract. Stutsman asked if the Board could get in trouble with the Auditor for giving money without a contract. Horne replied that they couldn’t because the Board is required to provide a minimum level of funding. Stutsman replied that they fund way beyond that. Thompson asked if they were required to fund all libraries or just one County library. Stutsman said she thought it was just one. Thompson said they have a minimum amount based on the County’s population and that could be divided up among the libraries. Neuzil said the minimum was only $63,000 and the County gives more than $400,000. Horne said the Board could decide to fund only the Iowa City library.

Stutsman said she didn’t understand why the Board could spend taxpayers money without contracts in one area, but not in another. Horne replied that they didn’t have to have contracts because they were codified to provide it. Thompson said if the Board goes over the minimum, there should be contracts in place or not spend the extra money. She suggested next year not giving any money to libraries that don’t have contracts. Sullivan replied that the Board couldn’t do that. Neuzil said the State of Iowa has different standards. He said the State wants measurements of cost yet they give giant bonuses. Stutsman said that if the County was going to be held accountable for having contracts in one department, then she wants to have them in all departments. Horne said the Board could take out the Iowa City contract and replace Iowa City with each of the other City libraries. Stutsman said that’s what they originally said for the contracts and they haven’t been completed. Thompson said that means the Board is limiting themselves to a growth that they have no control over because if circulation goes up the Board would pay more. Neuzil said the Board can’t continue that because being $400,000 over what is in the Code is a problem. Thompson suggested fixing the contract so it says growth is going to be limited in some way. Neuzil asked what the essential County purpose in funding the libraries is. Stutsman said the Board has to decide what is essential and how far above what is required. She said that is fine if that is what the taxpayers want, but then they have to recognize they’re going to have to pay for it. She said she is totally supportive of libraries, but asks if tax monies should support a library in every community. She said that today everybody has a car and comes into Iowa City on a regular basis.

Lehman said the library situation is similar to the situation with the Senior Center. He said that if the Board cuts funding to other libraries, as the rural people come in they’re going to have to pay an extra fee. He commented that the Board got a letter from someone living in the County that didn’t want to see library funding increased, but said the books his family uses is above and beyond the average. He said that those people should be expected to pay a little bit more for having that quality. Thompson added that she would be one of those people and that she wouldn’t be willing to pay more. Stutsman said she thought there should be one County library, which would be the Iowa City library. Neuzil said that is what Scott County has done. Horne suggested that the Board could reimburse library cards. Thompson said the problem she has with only one library is that the Board wants to promote community in the smaller communities and have done things like the family resource centers to help with that. She said the libraries in those towns are the family resource center because they have many activities. Stutsman said she thought it was more the schools. Lehman asked if the Board should cut everybody back proportionally then. Neuzil said that for some of the libraries, 50% of their funding comes from the County. Horne added that the County funds the majority of the Solon Library operations. Neuzil said that would be a real problem if the Board says they are no longer going to fund them. Neuzil asked how the Board would phase that out if that’s what the Board is going to do. Thompson commented that the Board doesn’t even know if the numbers are accurate and asks how the Board could audit those numbers. Stutsman commented again that the Board could reimburse library cards. Thompson explained that the library card is very cheap, but if people actually had to pay the cost of the libraries it would be about $300 or $400. Lehman said the County could pay for the $10 card and then every time people go they might have to pay a little bit per visit or per book. Horne commented that anyone with an Iowa City library card can use it at any of the libraries in the County. Stutsman said that has changed since the contract was put into place. Thompson said that was true as long as she could remember. Lehman asked if the book got counted twice or if the rural library only counted it. Thompson replied only the rural counts it. Sullivan said this type of situation is where a 28E Agreement would be a big benefit to the Board because every few years the Board can sit down with the Cities to discuss the changes that have taken place. Stutsman said that this may not be a big issue since it comes out of the rural side of the budget and that budget isn’t maxed out, but if the Board increases other items in that side of the budget these library changes could have a big impact.

Neuzil said if the Board cut $200,000 out of the library budget, there would be $200,000 more for roads. He commented that Gardner had many other projects to do if they only had the money to pay for them. Horne noted that was a tradeoff for the Board to weigh. Stutsman said that the rural taxpayers would be happy if the Board could reduce their taxes this year, but would they love it if they didn’t get library services. Lehman said it would be both ways. Stutsman asked if it was duplication of services for the Board to support multiple libraries, especially since new ones keep getting added. Thompson asked if it was clear in the Tiffin library proposal whether or not they’ve set aside the school usage so the County wouldn’t have to fund it. Horne said they had a way to separate it from the school. He said that Tiffin is similar to Oxford in that they are only asking for an amount, not based on usage. Neuzil asked if they could just start giving blocks grants instead of basing it on usage. Thompson reiterated that even if they started giving block grants, they need to have contracts. Stutsman agreed. Horne said the Board wanted to see the outcomes. Stutsman said the Board could implement contracts similar to the MH/DD agency contracts, whether the County would pay for a service and the libraries would tell the County how much the service costs and that’s what the County would pay. She said that way would be a lot more work. Horne said VNA money was going to go to help people to stay in their homes longer, instead of going to nursing homes, so VNA reports the number of people visited and the hours spent with them. Horne said though that with that type of contract the Board is funding specific programs within agencies like MECCA treatment. Thompson commented that the Board allows smaller agencies to use funding for general operating costs, which many appreciate because most grants are tied to specific programs. Stutsman said that again, it’s about priorities, whether or not the Board is committed to a strong human services network and if so then the Board needs to provide funding they can use to operate.

Neuzil asked what trends Horne sees in State funding for the next year. Horne replied that the State is looking better now than in the past. Neuzil said that the rollback would be similar with low interest rates again, 3% growth, TIF areas are understood and although COLAs are yet to be announced, will probably be between 2 to 3%. He asked what the State was going to do this year. Stutsman said the only item she heard that was going to be a major goal was to lower the alcohol limit, but didn’t know what kind of impact that would have. Horne replied that it would have an impact on the jail. Thompson asked what the State is going to do about the homestead exemptions, either changing or getting rid of them. Horne said he heard the State was going to lower more of their credits. Neuzil asked if they would make the counties pay for it. Horne replied either the counties or the taxpayers. Thompson said the State was also looking at changing the time an inmate could spend in the County jail from one year to 2. She commented that it had already been tried twice, but the 3rd time is the charm.

Neuzil asked about Road Use Tax Funds. Horne replied that the County Engineer thinks they are secure because if the State was to shift the formula to the legislature, the County would gain. Neuzil said that wouldn’t happen. Stutsman said the Board has to realize that the balance of the legislature did not change, so it’s still a rural legislature that’s going to protect the Road Use Tax Funding. Horne said he didn’t anticipate it falling from current levels either. Stutsman said she would be more concerned if she was in Adair County, but for Johnson it wouldn’t be a big concern. Neuzil asked if funding for certain State grants is going to fall off that the Board would have to get rid of or replace the funding for. Horne said that in time the County might lose all the Juvenile Crime Grants, which is already down to $30,000 to $40,000. He said that in a DHS meeting he was told that the money is passed through from the Federal Government and they are going to shift the money into other programs. Thompson said that currently the County puts in $170,000 and the State puts in $30,000, but it used to be the other way around. Stutsman said from day one the County was told that the money was start up money that eventually the counties would be required to take over more and more. Thompson said the program has worked because the Board had goals that were reached. Stutsman said the benefits justify the tax dollars.

Horne suggested the Board look at the departments listed under Public Safety to decide on priorities for the next budget work session. Neuzil asked if Horne would have payroll numbers by the 10th. Horne replied he couldn’t guarantee it. Neuzil said if the Board doesn’t know the numbers it will make the process very difficult. Thompson said that this happens every year. Horne said it will improve in the future because the new financial system that will give him payroll numbers earlier in the year, like December. Neuzil asked if all the departments had their budget in. Horne replied that all did. He added that he had the Information Services Director Jean Schultz look through the technology budget in Capital Expenditures, so he would be giving the Board an updated version of that as well. Thompson said the new budget requests sheet shows $1.5 million without 2 departments. She said adding the new requests to the COLA’s and health insurance increase is more money than the County has. Neuzil said the $1.676 million in new requests was only for technology too. Horne explained that the new budget request matrix was new and a lot of the technology requests are ongoing. He said the mainframe transition to software is new. Thompson clarified that the $430,000 is new money on the technology in addition to what is the County has already saved. Horne said the increase in capital expenditures was all new requests. Neuzil said the new requests at this point under personnel add up to $480,000. Horne said yes, but that it also includes FICA, and IPERS and isn’t just salaries in each position. He said the Capital Expenditure requests add up to $405,000. He said request expenditure is $223,000 but some is savings for future years, so the total is $405,000. Neuzil asked about the technology requests. Horne said he would get updated numbers to the Board.

Thompson said the Public Safety items that are on the Board’s list of non-essential services are charging accurate costs to the towns so that they could talk about moving the Sheriff’s patrol to the Rural Fund. She asked Sullivan if the County was allowed to have a separate taxing authority for the Ambulance Department. Sullivan replied that the Board can have a service trust authority for the Ambulance Department. Thompson said they’ve talked about this in the past, and it is something that would require some follow up. She asked if the Board was interested in the idea enough to look at it closer. Stutsman asked what the advantage of it would be. Thompson replied that the Ambulance Department would be able to tax for their own function and would work with other communities. Horne said the Ambulance Department would then have a governing board made up of the Board of Supervisors and the towns. Neuzil asked where the revenue would go. Thompson replied it would go to the same place. Sullivan said it can be done, but takes a considerable amount of planning. Thompson said the Board might not be able to do it this year, but if the Board is interested they should get started. Stutsman asked why the Board would be interested. Thompson replied that it would take the taxing out of the General Fund. Stutsman said it sounds like the Board is trying to make decisions today without all the information. She said she wants to go through the budgets and see where the Board is at. Horne said the authority is something the Board can talk about Friday. Stutsman asked if the General Fund isn’t having problems, then why does the Board want to go through all the problems of setting up an authority. Horne said the General Fund isn’t a problem this year, but what the Board needs to look at is how the health insurance and juvenile detention costs in the Supplemental Fund will affect the taxation in the General Fund. Neuzil asked if Horne was suggesting that if the Supplemental Fund goes too high, the Board might need to lower the General to balance things. Horne said it depends on the size of the tax increase the Board wants to pass on to the taxpayers.

Thompson said the only other things on the agenda to talk about are the civil actions in the County Attorney’s Office. Horne said they could talk to County Attorney J. Patrick White about that when he comes in. Thompson said White makes a policy about what civil actions he will take, but the criminal code specifies the criminal requirements. Neuzil asked if that matches up with the new employee he requested. Horne said White was requesting a new paralegal to help in juvenile matters. Thompson said the juvenile delinquency cases have stayed steady or decreased, but the child welfare cases are going up and they are much more time consuming for the attorneys.

Horne said this meeting was to give an over view to the Board of the new budget process. Neuzil commented that the process seems much more organized. Horne said once the new system comes on line, it will get even better. Lehman added that the departments knew the Board had limited funds, which limited their requests. Horne said he still wanted the Board to get all the requests, but he talked to the departments about it and met with them in good detail. Thompson clarified that Horne wanted the Board to look through the different decision packages. Horne asked the Board to look through the information and think of how as a Board they want to prioritize public safety items. Neuzil asked what special revenue funds are. Horne replied that they are forfeiture funds, but there’s not much discussion needed about that. Thompson asked if emergency services were separate. Horne said Emergency Management is not a County department, but a block grant. He said the Board doesn’t have to fund Emergency Management through the General Fund, they can set a separate levy instead. Stutsman asked if it was similar to the authority for the Ambulance Department. Horne said Emergency Management already has it’s own Board and is funded outside of the General Fund. He said the County has to pay into it, but could change the way it pays. Lehman reiterated that the Board has to look at a person’s overall tax bill. He said that the Board can’t change it every year based on the Board’s approaching the General Fund limit. Neuzil said the Cities do it all the time with TIFs.

Neuzil said it will be a long day when they discuss block grants. Horne replied that they wouldn’t be going through each of them that day because they will be split among different days, but many would be that day. Neuzil said if the Board wasn’t looking at across the board cuts, it would take even longer. He said most of the block grant only asked for modest increases like 3%, but there may be 2 that will take most of the discussion. He said that some didn’t even ask for an increase. Neuzil said the trend in the past few years was either a freeze or a minimal cut with only some eliminations. Horne suggested discussing the future of VNA, Free Med and the Elder Services Block Grants with the Board of Health. Neuzil said the Public Health Department pretty much just rubber stamps the requests. Thompson said they have some discussion. Stutsman said the Board of Supervisors is the ones that rubber stamp what the Board of Health says. Neuzil said he thought that February 3rd and 4th wouldn’t be enough time to formalize the budget, especially if the Board isn’t making any decisions along the way. Horne said the Board would be making some tentative decisions and then review that at the end. Stutsman said she was impressed with the calendar Horne put together, but she thought the Board had to make a real effort to keep on track. Horne said one of his goals is to cut down the Board’s meeting time this year because of increasing demands on their time. He said he was going to try to keep the meetings on task within the different service areas until the Board reaches the general discussion aspect of each day. Stutsman reiterated that the department heads will not be attending the meetings with only a few exceptions. Horne added that the Board would be meeting with the elected officials as well. Thompson commented that there wasn’t really anyone else that asked for a large enough increase that they’d have to explain themselves. Horne said there was even a couple of elected officials that said they didn’t need to see the Board. Neuzil commented that there are a couple of elected officials who didn’t turn their budgets in on time that could be in jeopardy of the lateness affecting their budgets. Stutsman said that was something that the Board can talk about at the end of the budget process if there are any changes that they want to make. She said if the Board is going to make drastic changes that they need to give people ample time to know. Horne said he will continue to refine the process.

Stutsman asked where the County is at on the Financial software. Horne said FinCore has decided to reopen Gems again, much to his chagrin. He said he was personally ready to make a decision, but there are other people that have reservations. Thompson said the Committee is so far behind schedule now that they might as well do it thoroughly. Neuzil asked where that investment fell and Horne replied technology. Lehman said there comes a time to cut the cord and make a decision. Thompson asked how much money they had saved for the new software. Horne replied that there’s about $150,000. Neuzil asked if election machines will be taken out of the Supplemental budget. Horne said the Board could bond because voting equipment is considered an essential county purpose. Lehman said it would add to the tax bill though. Neuzil clarified that the Board can’t take it out of the Supplemental Fund even though elections falls under supplemental. Horne said the operations aspect of elections applies, but the State doesn’t allow big ticket items to be taken out of there. He said they specifically list voting equipment in the essential county purposes for bonding list. Thompson said that in the 4 years the County has been investigating it, the price has gone down quite a bit. Horne said that with the new financial software, he would be able to lock the departments budgets on the due date so now changes could be made without his unlocking them.

Neuzil asked Horne if there are any additional trends the Board should keep in mind. Horne reiterated that the Board should keep in mind the increasing costs of health insurance and juvenile detention costs, which would be several hundred thousand. Thompson asked if Chief Juvenile Detention Officer Brandon Beaudry requested another detention alternative slot, because he doesn’t show full usage on the ones he has. Horne said it was the shelter costs that were rising. Neuzil asked about jail transportation costs. Horne replied that there was an increase, but it isn’t as much and is now built into the future budget. Stutsman commented that the Board doesn’t know what the Taskforce will recommend and she asked if anything has been put into the budget for jail alternatives. Horne asked if the Board wants to leave that money in the Sheriff’s budget or put it in central services with the bill sent to himself or Sullivan. Neuzil said that the alternative makes sense if they were taking cuts across the board, because the Sheriff’s department made cuts where he know they would still require additional mandatory funding. Neuzil said the way to eliminate the problem was to take that area out of the budget. Thompson said it is a good idea because if the Board decided to spend the money on something else it would make it easier. Horne said that currently it is mislabeled because it wasn’t really alternatives, but transport and housing costs. Stutsman asked if there is a budget request for that budget. Horne replied that Carpenter requested $130,000, so he’s up to $500,000 now.

Neuzil said he is afraid of different variables that they might not be aware of in a month. Horne thought it was wise to be cautious. Thompson said that last July the State surprised them by not funding the homestead exemptions. Stutsman said the State wouldn’t make the same mistake this year because the counties’ excuse was that their budgets were already set, so now they’ll tell the counties up front and they’ll have to make the decision whether or not to pick it up. Neuzil said he was thinking of what other ones are out there. Horne said that homestead will be the big one. Neuzil said he was thinking about the State grants and the State saying that they don’t have the money this year. Sullivan asked if any of the area legislators have an idea. Lehman commented that Mental Health balances are another issue in case the State decided to change the carryover balance again. Thompson asked if the County was better off to not tax for the maximum and lose the half million up front or to run over on the carry-over and loose a million dollars. Horne said the County would lose more than a half million if they don’t tax for the maximum. Thompson said they would lose $438,000. Lehman added that the Board would also loose the revenue from not taxing to the maximum. Thompson said if the Board looses $500,000 and then another $500,000 in lost revenue, they’re still not out more than the $1 million. Lehman said that MH/DD really needs to get their accounting system in place to help avoid that. Stutsman added that the Board also doesn’t know what the State will do about changing the base. She said the County could get caught short if the State makes changes. Horne said it was possible that the State could change mental health, but he don’t know if they will take it over. Thompson said the State doesn’t have the money, because they currently don’t fund their full share. Neuzil reiterated that there were some variables that the Board is not aware of because the State of Iowa is in big trouble.

Horne said another variable might be prisoner medical costs for people who are held in County jail on State charges. He said the State wants to pass those back onto the County. Thompson said the County will just have to not take them. Horne said White has been resisting that. Stutsman asked how Medicaid would transfer additional drug costs for the County. Thompson said it can translate into a lot because there are required and non-required programs in Medicaid. She said if the State cut back on paying for nursing homes for indigent people, then that would come back to the counties because they paid it before the State took it over. She said the law hasn’t been changed, so the bottom line for caring for the poor still falls back on counties. Horne noted that HACAP cut transitional housing funding totally. Neuzil commented that it is because they didn’t turn in the papers. Horne said it mostly affects Linn County, but also about 10 families in Johnson County as well. Thompson said that some might have enough income to pay rent. Neuzil asked the Board to think about the money the County gets from the State because he thinks the State is going to pass it down. Horne said MH/DD is the biggest variable because that’s where the County has the most interaction, that and roads. He said there isn’t much legislative involvement with roads. Neuzil said the State could pass on the 26 miles of roads to the County. Horne said if the County inherits 923 and 965 north of North Liberty there will be an impact on the County. He said the County would inherit the one lane bridge south of Hills. Lehman said that the bridge is on the State’s schedule to fix. Stutsman said the State doesn’t have any money.

Horne said another trend is the future 6 lane Highway through the County and he asked what affect that will have. Lehman said that was more for safety and it shouldn’t really have an impact. Horne said it might bring in more business moving into the area and things like that. Stutsman said it ties in with the whole corridor concept. Thompson said it could be good. Horne asked what impacts in services it will have. Thompson commented that economically Iowa tends to trail, so the State was slow coming into the recession, but will also be slow coming out. Horne said he was trying to isolate different areas of rural that could be consider rural rural were Stutsman lives or urban rural where Thompson lives. He said he would like to separate those 2 categories by valuation. Thompson said the legislature doesn’t recognize any difference though. She said in order to keep the taxes for farmers down, the Board must keep the taxes for the richest people in the County low as well. Stutsman said it is too bad they couldn’t just divide the County in half for taxing purposes. Thompson said there were a few half-million dollar hours in the southern half of the County too. Neuzil said he and his wife pay $210 more per year now for the $20 million bond referendum. He said they chose to live there too though for the services. Horne said budget wise the Board won’t be able to respond to the Taskforce. He said it will have to be in next year’s budget before the County can address the recommendations. He said a new facility would cost more too and the Sheriff’s budget is already over $6 million. Thompson said the Board thought they would phase those in too by selling open beds. Stutsman said not to plan to pay for the jail by selling beds. Thompson said it would just phase in the extra staff costs.

Horne said economic growth in the County’s tax base is absolutely critical. He said if the County has 2 years where it stays flat, it’s going to start hurting the County. Lehman said they were already starting to see it in construction. Thompson asked if permits have started going down, and Horne said they hadn’t. Lehman said most of the homes had to be pre-sold now before they could get financing. Horne commented that with low interest rates, it’s starting to get to the point of diminishing returns. Lehman said the only way they could be differential was to do a farmstead split and do residential on the house and buildings and rural on the farmland. He said it was too risky, but a good investment. Stutsman said in Iowa what’s valuable is land and it’s not the farmers that are investing in it. Horne noted that although the University doesn’t pay taxes, it has an effect of driving up the value on other properties. He said it shows in relation to a county like Black Hawk County that has 20,000 more people, but is worth less money than Johnson County.

Neuzil asked if there was anything else to discuss on the 2004 budget. Horne said he didn’t think so because they had gone over the process.

Adjourned at 10:45 a.m.

Attest: Tom Slockett, Auditor

By Casie Parkins, Recording Secretary