Chairperson Jordahl called the Johnson County Board of Supervisors to order in the Johnson County Administration Building at 3:23 p.m. Members present were: Jonathan Jordahl, Mike Lehman, and Sally Stutsman. Also present were Deputy Administrative Assistant Deanna Pillard, Deputy Auditor Kit Wong, and Deputy Auditor Chris Edwards.

Jordahl said this work session was devoted to discussing the Conservation Board's budget. Deputy Auditor Kit Wong said the conservation trust was created for specific purposes so the Board of Supervisors and the Conservation Board could not use it for equipment purchases. Jordahl read aloud the conservation trust's budget for FY 1999 which included $10,000 for tables, chairs and supplies for the Conservation Center Education Building. Jordahl asked how tables and chairs were purchased in the conservation trust during FY 1999. Pillard said the tables and chairs were tied to a specific project but Jordahl wanted to allocate funds for general types of equipment such as a mower or dumptruck for conservation as a whole, such as a capital expenditures fund. Jordahl suggested creating a new capital expenditures account credited to the conservation department which would be used to qualify for REAP dollars. Pillard recommended against taking such action as Jordahl suggested until the Board could explain its problems with the Conservation Board.

Stutsman and Jordahl said the Conservation Department had heard the Board's concern about using operational budget funds on additional personnel over the past 2 years and the issue had not been resolved. Pillard voiced concern that a special capital expenditure account for the Conservation Department would encourage other departments to request the same thing. Stutsman agreed, saying departments would want their own capital expenditure accounts so the Board couldn't use their capital expenditure funds for other uses, which the Board can now do with the general capital expenditure fund. Stutsman recommended that Pillard keep track of how Conservation spent their funds during FY 2000 and take more decisive action during the FY 2001 budget process if needed. Jordahl said other departments knew the Conservation Board was independent and had more autonomy than other departments, so other departments wouldn't request their own capital expenditure fund. Lehman said he would like to see the strategies employed by Linn County to qualify for REAP funding. Deputy Auditor Chris Edwards said the Board was legally prohibited from removing REAP funds once they were deposited but is not prohibited if capital expenditure funds were placed in, which might explain why a capital expenditure account couldn't be created for the Conservation Department.

Jordahl recommended enacting a policy for every department which prohibited any funds other than identified personnel moneys from being spent on personnel. Pillard said department heads would argue against this change, saying this policy was not in effect when the department heads prepared their budgets for FY 2000. Stutsman said this action would undo the Board's efforts to foster more communication between department heads, elected officials, and the Board. Jordahl said an agenda item should be created for the next department head/elected officials meeting to discuss this policy. Pillard said it was too late in the budget process to attempt to enact this policy. Jordahl said there was $856,000 in unexpended personnel funds as of July 1998. Pillard said the $856,000 were used for other budget items in department budgets, such as the Sheriff's Department for running the jail, which would lead to more budget amendments during the fiscal year. Stutsman said a work session needed to be done with department heads and elected officials before anything more with this policy could be done. Pillard agreed and said she doubted this policy could be enacted for FY 2000. Jordahl agreed with the work session idea, and said unless strong objections were voiced by department heads or elected officials against it, then a resolution should be passed which would be in place before FY 2000.

Conservation Department Director Rod Dunlap, Conservation Board Member Peter Sheets, Conservation Board President Gerald Morgan and Conservation Board Member Tom Hoff, and Conservation Department employee Rose Grace arrived at the meeting to discuss the Conservation Department. Jordahl explained that the Board was investigating allocating capital expenditure dollars for the Conservation Department into the conservation trust. Jordahl read from Code of Iowa section 350.6 which directed: "Upon request of the County Conservation Board the Board of Supervisors shall establish a reserve for county conservation, land acquisition and capital improvement projects." Jordahl interpreted the code as prohibiting spending for items such as machinery. Dunlap said the only funds that had been placed into the conservation trust were revenues generated by the Conservation Department. He continued by saying the conservation trust was actually a reserve fund. Jordahl read another portion of the Code of Iowa: "Annually the total amount of money credited to the reserve plus moneys appropriated for conservation purposes other than the reserve shall not be less than the amount of gifts, contributions, and bequests of money, rents, licenses, fees, charges, and other revenues received by the County Conservation Board." Jordahl said in the past the Board had discussed not transferring the full amount of revenues generated by the Conservation Department into the conservation trust but he interpreted the code as prohibiting that.

Jordahl inquired about the Conservation Department's placing funding requests for removing and replacing storm-damaged trees under capital projects instead of the conservation trust fund. Dunlap explained that under the general conservation department budget (Department 24), was a park development series also known as the A3291 series. Dunlap said his department generally used the conservation trust fund budget for major capital expenditures. Dunlap also said the A3291 series can involve capital expenditures and the A3291 was part of the general Conservation Department budget, not the trust. Jordahl said whatever funds were dispersed for storm damaged trees should come out of the conservation trust fund, not the Conservation Department's budget like Dunlap had done in his budget proposal. Dunlap replied to Jordahl statement by asking if funds other than revenue would then be transferred into the conservation trust fund. Jordahl said he was talking about putting additional money into the conservation trust to fund replacement of the storm damaged trees, not withdrawing funds beyond the norm from the conservation trust without compensating the Conservation Department. Sheets said the conservation trust had been used in the past to fund projects that took multiple years to complete and money from the Conservation Department budget and A3291 were used for projects which could be completed during that current budget year. He continued by saying capital expenditures had been funded from all 3 budgets in the past, and combining them into one capital expenditure budget would be inappropriate. Stutsman asked Sheets why he felt this would be inappropriate and he answered by saying the conservation trust was used to save money and fund projects that the rest of the county had trouble funding. He continued by saying combining the capital expenditures into one budget for the Conservation Department would harm the budget, because it would place small-term capital expenditure moneys into a long-term budget process which would make future budgeting difficult for both the Board and the Conservation Department.

Jordahl said the Conservation Department identified what a budget's purpose was differently than the Board. He said projects which could be completed within one year were called capital projects by the Board and multiple-year projects were labeled capital expenditures but the conservation department called both types of projects, regardless of their duration, capital expenditures. Jordahl said replacing the storm-damaged trees was a multiple year project because the storm occurred in FY 1998, the trees were removed during FY 1999 and funds were requested to replace them in FY 2000. Hoff said this was the first opportunity to replace these trees. Jordahl replied that the Conservation Board could have requested a budget amendment. Gallagher said the Conservation Board rarely asks for budget amendments because they plan ahead and attempt to use their own funds for emergencies. Jordahl said he wanted budget requests to reflect expenditures made in that year. Dunlap said a good portion of tree replacement funds have been funded by FEMA. He continued by saying the Conservation Board had not requested a budget amendment because FEMA funds were a part of the Conservation Board's budget and they were waiting for the funding to come through. Dunlap said REAP funds were appropriated by the State of Iowa, and these funds were often not spent through the budget process, because predicted land acquisitions didn't occur, or capital projects were not started, so the funds carried over to the next year. He said that a mechanism is needed to provide a small reserve for capital expenditures such as the conservation trust fund.

Stutsman said the Board wanted funds for one time projects, such as tree removal, removed from departments' operational budget because the budget has to be readjusted the next fiscal year so one time expenses aren't carried over into the next year. Stutsman also said the Board wanted to more closely track departmental expenditure and it would be easier for the Board to itemize and track the Conservation Department's expenditures if projects like tree replacement were in the conservation trust. Jordahl reassured the Conservation Board members that money would be appropriated into the conservation trust fund to cover the cost of replacing the storm-damaged trees. Dunlap agreed that from a management point of view it would be advantageous to put funds for tree replacement in the conservation trust fund. Stutsman explained that the Board had created capital project funds for the other department in which the Board placed funds in addition to their operations budget to be used on large projects, but the Board was unable to do this with the Conservation Department because of the need to maintain REAP funding. Dunlap asked if the Conservation Department would still be able to manage the interest earned and keep the revenue generated from investing moneys from the conservation trust, as they had done in the past. Jordahl said he believed the Board wasn't allowed to withdraw money from REAP or the conservation trust fund. Lehman read a portion of the Code of Iowa which stipulated that the Conservation Board controlled the interest generated from investing the conservation trust fund and interest from the REAP funds. Stutsman said she did not want to mislead the Conservation Board and that the Board had not committed to a specific amount for storm-damaged tree replacement. Lehman inquired about the survival rate of replaced trees and FEMA funding.

Jordahl left at 4:18; returned at 4:20 p.m.

Dunlap said the budget request was for replacing tree plantations and the existing Iowa Upland Woodland Timber. Dunlap said FEMA funding could only be used for trees that imposed a danger upon the public, so the funds request for tree replacement was not covered by FEMA.

Jordahl asked about the Conservation Department's request to purchase equipment which would normally be under the general capital expenditure fund but was in Conservation's operational budget. Jordahl said he would prefer that the Conservation Department request funds to be saved over multiple years rather than requesting $20,000 for the full cost of a one ton truck in FY 2000. Dunlap said this was the first year the Board had allowed multiple year savings and the truck was needed in FY 2000. Jordahl said the Board had pondered creating a new capital expenditure budget for Conservation. He continued by saying to grant Conservation's capital expenditure request a special capital expenditure budget just for Conservation would need to be created or the request would need to be moved into the general capital expenditure fund. Dunlap said there wasn't a problem with putting those funds into the general capital expenditure fund but he needed an approved budget to buy the one ton truck and crawler during FY 2000. Dunlap said the $14,465 request for a crawler was for the second payment on a 5 year lease. The Board asked that the Conservation Board request funding over multiple years based on the average life expectancy left on their various pieces of equipment. Lehman explained this kept departments' budget requests from fluctuating to a large degree from year to year. Dunlap and Sheets said their budget ended up being 22 cents out of 1,000 from year to year to maintain REAP eligibility.

Jordahl asked about the new personnel request funded from changes in the Department of Conservation's base budget. Jordahl voiced concern over this because new personnel was a regular expenditure for year to year. Dunlap said the Conservation Board was unable to maintain their level of performance with the staff they had, that it was requested for FY 1999 as a base increase and it was now requested as part of a 0% increase. He added that the new Conservation Center would also cause an increase in workload.

Duffy asked if a special fund was going to be created for the truck and crawler or whether the general capital expenditure fund would be used. Duffy was apprehensive about all departments using the same capital expenditure fund. Jordahl said this issue still needed to be resolved. Jordahl said capital expenditure funds for the Conservation Department placed in the general capital expenditure fund would have to be specially earmarked for that department. Jordahl said answers were needed from the County Attorney or the State about capital expenditures in the conservation trust fund and other possibilities before this situation could be remedied.

Dunlap invited the Board to attend the next Conservation Board meeting at the new Conservation Education Center where yardbird would be served.

Dunlap reiterated that his department needed funding to replace storm-damaged trees and pointed out that percentage increases in his base budget would accomplish that.

The Board discussed the schedule of upcoming budget work sessions.

Adjourned at 4:55 p.m.

Attest: Tom Slockett, Auditor

By Todd Schanbacher and Darby Cole, Recording Secretaries