Chairperson Bolkcom called the Johnson County Board of Supervisors to order in the Johnson County Administration Building as a Department Head Meeting at 1:40 p.m. Members present were: Joseph Bolkcom, Charles Duffy, Jonathan Jordahl, Stephen Lacina, and Sally Stutsman.

Department heads present were: Ambulance Director Mike Sullivan, County Auditor Tom Slockett, County Engineer Mike Gardner, County Recorder Deborah Conger, County Sheriff Bob Carpenter, County Treasurer Cletus Redlinger, Department of Human Services Area Administrator Cheryl Whitney, Human Resource Administrator Lora Shramek, Information Services Director Jean Schultz, Mental Health/Developmental Disabilities Director Craig Mosher, Physical Plant Manager Pat Langenberg, Planning and Zoning Administrator Rick Dvorak, Public Health Director Graham Dameron, Interim SEATS Director Burnell Chadek, Veterans Affairs Commission Director Leo Baier. Staff present were: Deputy Auditor Chris Edwards, Board of Supervisors Deputy Administrative Assistant Deana Pillard, Human Services Accountant Kathy Lynch, and Auditor's Office Recording Secretary Mindy Green.

Bolkcom called the meeting to order and stated they were there to talk about the Fiscal Year 2000 budget. He explained that a packet had been distributed to all of the departments that had a timeline, the budget memo, and sample worksheets in it. Bolkcom also thanked Supervisor Stutsman, Supervisor Jordahl, County Auditor Tom Slockett, and Board of Supervisors Deputy Administrative Assistant Deana Pillard for their work on the budget process. Bolkcom said in the next few weeks the official budget worksheet will be coming out, the Compensation Board will be meeting in October to make recommendations on elected officials salaries, and the budget worksheets will be due in the Auditor's Office by October 23rd. Bolkcom said that this year they will begin budget deliberations November 30th and spend most of December reviewing the budgets. He said in early January they will be looking at revenues and how the rollback and equalization or evaluation changes might affect the resources they have to work with next year. Bolkcom said the Board hopes by the middle of January to finalize the budget and have publication, the public hearings, and adoption by the middle of February. Public Health Director Graham Dameron asked if the deadline of October 23rd could be flexible for him because he has to discuss his budget with the Board of Public Health. He said they normally have a special budget meeting in early November. Bolkcom said that was question as the timeline was developed for those departments that have to report to a board, so it would be fine as long as they turned in their budgets as early in November as possible.

Bolkcom asked the department heads to review the budget memo for 5 minutes to see if they had any questions. Bolkcom asked Slockett to lead them through the worksheets. Bolkcom said the Board's approach to the budget was an evolving one. He said last year they had success in some things they tried and there were new things being proposed that they hoped would improve the process for the Board and the department heads. Slockett said the first worksheet was the expense worksheet and it will have historical information, actual data for FY97 and FY98, and current year data to date. He said the re-estimated budget column is blank and that is for the departments to give their best estimate of any changes they can anticipate. He said next year's budget expenses will be listed to the right. He said the expense sheet is to be at the same budget level. Slockett said the Board wants a same level budget submitted. Slockett said there are forms they will be dealing with later that are for requests for additional amounts. Bolkcom asked if somebody submitted a budget amendment memo to them in the last month should that be attached to their budget sheets. Slockett said that would be up to the Board. Jordahl said if it was a onetime expense it might not be something people wanted to include in their request. Jordahl asked Slockett to talk about additional needs. Slockett said the Board wants two types of narratives; the first being an overall departmental narrative about what the budget is providing the citizens of the county, and the second being for the changes in the budget. He explained that if departments could reduce their expenditures they should also provide a narrative for the reduction. Slockett said they will be asking for formalized incremental increases to be asked for. He said for every request for additional funds, or for every increment, they want a narrative about what changes would result in the department, what are the advantages, and what is the rationale.

Slockett said the revenue worksheet was just like the expense worksheet. It will have historical data, actual FY97 and FY98 data, and estimates for any changes. Mosher said he understood the total needed to be the same on the expense and revenue worksheets, but asked if they could they make adjustments in the line items. Slockett said that was perfectly all right.

Slockett said they would now discuss additional needs. He said one of their concerns in viewing increases was taking into account the varying needs of departments that have grants. He said they are asking that the grant dollars be specified in column A of the worksheet. He said the Board recognizes that it doesn't want to cut funding for a grant because that would affect their ability to bring in revenues. He said the grant total would then need to be subtracted to produce a departmental total excluding grants and then they will need to then fill in the 1% increase excluding grants through a 5% increase. Slockett said that the idea is to calculate what a 1%, 2% and so forth increase would be so that they exclude the grant funds. For example, a department could have a grant that would double the budget and they don't want to give a 1% increase of tax dollars on the grant money and the tax dollar money as well. Slockett said the Board wants to limit the increase that they're considering to the amount that affects property taxes and that doesn't discourage the departments from getting grant money because they might be penalized for it at a later time, and it also doesn't allow them to inflate their budgets in the tax dollar portion. Department of Human Services Area Administrator Cheryl Whitney asked if they were talking only County tax dollars or that plus revenues. Slockett said they were talking strictly at this point about the expenditures that are not related to grant dollars. Whitney said that some of their revenue is directly proportionate to the amount of expenditure they have. Lacina said they should just take their grants out because they don't want to reduce grants. Dameron asked for an example. Slockett said the Board, at the end of the budget cycle, discovers that the taxes are going up more than they can justify; they make cuts to get taxes down to a level that is acceptable. He said in some cases they've cut departmental expenditures that are funded by grants. So if they cut that expenditure, then the department would no longer qualify for the grant. Then the revenue is decreased even more than they cut expenditures and they defeated their purpose. Dameron asked for an example on a line item. Slockett gave the example that there was a grant project that funded salary and the salary was boosted as a result of that, then they would have the amount that was grant related in column (A), and then when they figured the 1% increase those would just be without the grant money. Lacina said they have a unique situation on Dameron's budget with portions of salaries allocated to grants and they will have to sit down and talk about it. Lacina said the intent of this is not for setting cost allocation but for the tax levy. Slockett said a 1% increase isn't for each line item but for the total at the bottom of the worksheet. They just need to know where grant money is being expended. Jordahl suggested they take the department total and subtract grants and take that number for their 1%. Slockett agreed that was what they were supposed to do.

Human Services Accountant Kathy Lynch asked if they would then pick, for example, column (D) to list the additional needs if they want a 2% increase. Slockett said if they need a 5% increase they should fill out 4, 3, 2, and 1, and if they need a 3% increase they need to fill in the amounts for 1 and 2. He said if they need more than 5% the Board would like them to list the amount on Column (H) but also fill one out for 5, 4, 3, 2, and 1. Jordahl said the idea was to provide more latitude to the department head to determine what their priorities are. Slockett said an example would be that at 5% they would have the ability to work with line items they couldn't if they asked for a 3% increase. Jordahl said instead of them just funding partial requests, the Board would fund an increase determined by the department head. Dameron said that it was possible that all of the columns would be different. Jordahl said they could be or they could just be additive.

Sheriff Carpenter asked why they would put it in percentages. Jordahl said it was kind of an experiment. Carpenter said he thought there was going to be some discussion about how the department heads felt about doing this. He felt it was a waste of time determining percentages and didn't make sense to him. Carpenter said people don't ask for what they don't need. Carpenter said that it was a benefit for Auditor's Office. Bolkcom said that on Tuesday the Board agreed that it might help the department heads figure out their priorities with costs in mind. He said if they try this and they find it isn't providing the benefit they think it might, they won't do it again. Carpenter asked, if they wanted a 1.5% increase, would they propose a 2% increase. Slockett suggested they say "up to 1% or up to 2%." He said the advantage to the Board is that if they have to cut a department's request they will have thought it through in a way the department can function and utilize the funds in the best possible way. Carpenter said he understood asking for priorities, but he didn't understand what it had to do with percentages. He asked what if he asked for something that was going to be a 2% increase and the Board said they can't do 2%, but that he can't use less. Slockett said then he wouldn't fill out the 1% column. Jordahl said that if they describe the impact of their requests on their department it would be helpful.

Dameron asked if any budget amendments with grants will need to be put on the additional needs worksheet. Slockett said yes. Bolkcom said budget amendments which were documented and approved this year should have the information resubmitted so that there isn't additional work. Slockett said that salaries other than new positions will not be affected by the 1% increments because the salaries are covered by collective bargaining or the salary survey and reviewed by the Board separately. Dameron said they were most concerned about the tax levy and he wished they could somehow include amendments that are not one-time expenditures. He said some items weren't additional needs if there was a zero tax levy. Slockett said it could be that the Board could approve it on the grant line. Jordahl asked Slockett to back up and talk about grant money in the budget amendment. Slockett said it would be subtracted out and Dameron said it would still be included. Jordahl said they could simplify it if grant money was multi-year by including it. Bolkcom said the goal of the amendment was to see what would legitimately get included in the FY 2000 budget. Slockett said he couldn't think of an example of an amendment that wasn't carried forward. He said if amendments are a permanent part of a budget they should be included in the base budget. Bolkcom said they want to make the process of amending budgets more complicated so people won't be back in for amendments. Slockett said that would require another round of discussion for amendments. Bolkcom said they should make determinations before worksheets are submitted.

County Recorder Deborah Conger asked if one built a one-time expenditure into their budget originally and it's carried forward then there's no problem, but if they didn't build it in then it becomes an addition and it's not carried forward. She asked if they were penalizing people who don't have a budget amendment of a one-time expenditure and the person who built it in is not. Slockett said that was true. Conger said then that one-time expenditures, whether they were amendments or in the budget, need to be looked at. Jordahl said that was part of what the capital budgets are about. Conger asked if this process addresses that. Slockett said it does indirectly. He said one way to do this might be to have the departments, particularly those who have had amendments or anyone else who has had a one-time expenditure in their budget or coming up, to work with Pillard to have the current year budget amount adjusted with the approval of the Board, otherwise the process isn't meaningful. Jordahl said if people realize they have to explain amendments it will encourage people to be more precise. He said they could have 2 types of budget amendments, one-time expenditures and ongoing expenditures. Bolkcom asked if people already have one-time expenses in their budget, would they indicate the amount which could be cut. Jordahl said he wants to discourage amendments. Slockett agreed and said that amendments aren't fair to everyone else. He felt they should ask why the department didn't propose it during the budget cycle and why can't it wait until next year. Dameron asked if the additional needs were under aggregate categories or line items. Slockett said it would be under account numbers and they will be flexible in implementation. Conger asked if revenues increased, requiring amendments in expenditures, is that taken into account. Bolkcom said they would amend the budget for both. Slockett said the appeal there should be made in the narrative.

Slockett explained that the payroll worksheet was the same as the previous year's. He said they have printed out all of the current information for all of the department's employees and they need details for them. He said for those people who have second tier salary survey increases they have to put them in for their current employees. He said other than that this information will be taken care of by the Board. He said the form will help check accuracy of the information; if a position is now vacant it can be marked as such. At the end of the payroll sheet they can request new employees.

Slockett said capital projects requests and capital expenditures requests were attempts by the Board to try to take out of departments' annual budget large incremental expenses that aren't continuing year to year to allow them to plan ahead for needs. He said capital expenditure requests would be things like office equipment, furniture, cars, vans, vehicles or special types of equipment. To fill out the worksheet, the department heads need to list the name of the project, the account number that it would eventually be expended from, whether it's a new project or an ongoing or existing one, the fiscal year of initial funding, the year they expect to accumulate the needed amount of funds and make the purchase in, the project total, the balance at the beginning, and the ending balance. He said the capital accounts would put funds in separate accounts for specific departments, like a savings account. He said the idea is to plan ahead and avoid bond issues. Dameron asked if the Board would report back what they already had in the capital projects accounts. Slockett said yes. Bolkcom said this type of budgeting has been evolving over the past 2 to 3 years. Carpenter asked who takes care of his department's building. Physical Plant Manager Pat Langenberg said the Space Needs Committee is discussing it. Carpenter said his vehicles are an ongoing annual budgeted replacement. County Engineer Mike Gardner and Dameron said they were in the same situation, but it was noted there will be a little variation. Lacina said on the capital expenditures form they are going to want the estimated life of the project or equipment so they can calculate depreciation costs and the estimated year it's going to go down. Duffy said this shows the possibility of projecting a budget over several years and they might look ahead. There was agreement this would be a good idea.

Slockett said the next form was for capital expenditure technology requests. He explained that the worksheets were ongoing and being improved as they went along. Conger said they need the concept of planned obsolescence Lacina was talking about built into this form. Lacina said the Technology Plan had said they needed to calculate the life of each PC and determine depreciation costs. Slockett said it seemed to him once one of the worksheets was submitted to Information Services Director Jean Schultz, she would fill out the technology expenditures and it would have the information about when the expenditures were made and what the life expectancy of the replacement was. Schultz said they have been budgeting for the replacement of existing old equipment but the individual departments need to list specific additions. Jordahl asked how individual departments budget for central items. Schultz said that in the central technology budget there are 2 sets of expenditure line items for departments, for new equipment and for the allocation of costs for central items to departments where possible. Bolkcom said there may be money budgeted also within department budgets. He said they need to clear this issue up at the next informal meeting.

Bolkcom said they also need to have a discussion of budget presentations. Pillard said they will let departments heads know schedules next week. She said they want to have most presentations completed in December. Slockett said the budget spreadsheet used by the Board was available on the network in a read only format, they may be able to e-mail departments not on the network but who have e-mail capabilities, and hard copies also would be made available. Lewis said he was confused by this year being a 27 pay period year. He said there were several people who are capped by the Compensation Board, such as deputies and also contracts go yearly. He said he was hearing that they just give people an extra paycheck. He said he didn't understand how they can do that. Slockett said the County was on a modified accrual system and there wasn't extra money for time worked. He said the Board approves payroll authorizations on a bi-weekly payroll amount. Lewis asked if in their budget they were going to have one additional pay period. Slockett said that would all be figured out by the Auditor's Office and the Board. Slockett said Lewis should just be aware that the payroll portion of his budget is going to go up one time by one pay period. Slockett said the Board began setting the money aside last year. Jordahl asked about people who were salaried instead of hourly. Slockett said that was why salaries were paid in bi-weekly amounts. Carpenter asked about elected officials. Slockett said the Compensation Board approves a 2 week amount. Bolkcom said they could call the Board with comments and questions. He said they should see it was a collective budget. Bolkcom said the Governor reacted to county budget increases last year, so they encourage people to pay attention to their needs and be responsible in what they present. Jordahl said they were also addressing space needs. Mosher said the ISAC newsletter had a good explanation of a proposed budget freeze and how little county budgets really increased.

Adjourned at 3:13 p.m.

Attest: Tom Slockett, Auditor

By Melinda Green, and Mark Kistler, Recording Secretaries