Chairperson Jordahl called the Johnson County Board of Supervisors to order in the Johnson County Administration Building at 11:08 a.m. Members present were: Charles Duffy, Jonathan Jordahl, Mike Lehman, and Sally Stutsman; absent: Carol Thompson. Also present were County Auditor Tom Slockett, Deputy Administrative Assistant Deanna Pillard, Deputy County Auditor Kit Wong, and Deputy County Auditor Chris Edwards.

Pillard directed the Board's attention to a new budget worksheet which was distributed at that meeting. Pillard said that at the last work session the Board had created a budget that they believed would increase the tax asking by $1 million. However, Pillard pointed out that the actual increase would be over $1 million due to increases in block grants and juvenile justice. Edwards said the increased tax asking from the budget created at the last session was approximately $1.5 million.

Thompson entered at 11:10 a.m.

Slockett said $500,000 had been budgeted to capital expenditures for Secondary Roads, of which only $24,000 had been spent over a 3 year period. Slockett suggested, since the maximum amount for the rural basic fund wouldn't be levied for FY 2000 and probably not for FY 2001, that money from rural capital projects be transferred to the Secondary Roads department, which would reduce the amount transferred from the general fund to Secondary Roads, thereby increasing moneys within the general fund to be used however needed. Slockett said County Engineer Mike Gardner didn't want these moneys transferred because it would increase the surplus in Secondary Roads for capital expenditures. Slockett suggested that the Board reduce the tax asking for Secondary Roads by the amount transferred, or spend the moneys in some other way such as transferring funds for space needs. Slockett continued by saying these actions would not be funding urban needs with levies from rural taxpayers, since the maximum tax for the rural basic fund had not been levied for several years while the cities tax asking had stayed at the maximum. He cited calculations in one of the budget handouts that showed the effect of this $500,000 transfer on the various county units which put the tax levy increase for rural agricultural land and buildings at 0%, rural agricultural dwellings at 2.84%, and Iowa City agricultural dwellings at 4.88%. Pillard also mentioned that the tax levy increase for various county units had been calculated based on transferring $250,000 to Secondary Roads and $250,000 to capital projects. Duffy said Slockett's suggestion was basically taking money from rural basic and putting it into the general fund and expressed concerned about modifying Secondary Road's budget. Slockett disagreed with Duffy's assertion that funds were being transferred from rural basic to the general fund, and said Secondary Roads did not need this money and had more than they could spend. Jordahl was enthusiastic about Slockett's suggestion, saying a 0% increase for most agricultural units was responsive to the farm situation. Jordahl was also pleased that the residential tax asking was brought below 5% by this, and no cuts would be needed for moneys that had already been budgeted. Lehman calculated the increase in the tax levy from FY 1999 to FY 2000, with the $500,000 transfer from rural basic, at 5.7%. The Board took a straw poll, and Thompson, Lehman, Stutsman and Jordahl were supportive of the funds transfer, but Duffy said he could not decide until he had talked with the County Engineer.

Conservation Department Director Rod Dunlap met with the Board to discuss his department's budget. Dunlap said it would be impossible for him to meet the Board's request to reduce line items within his budget by the 4th of February. Dunlap asked if moneys were going to be transferred into the Conservation Trust for capital expenditures. Jordahl said funds for machinery couldn't be placed in the trust because they weren't capital expenditures. Jordahl said funds wouldn't be put into the trust for tree replacement because it would limit Dunlap's flexibility, those monies could only be spent on trees and that new moneys above the minimum levy for REAP funding would not be allocated for the Conservation Department's budget. Dunlap asked if savings accounts were started for future equipment purchases. Jordahl said a separate capital budget for Conservation could not be created which qualified for REAP. Jordahl said funds for storm damaged tree replacement in Kent Park could be found by using the funds budgeted for an additional staff person that was budgeted within the Conservation Department's 0% base budget.

Dunlap asserted that the Conservation Department's budget had actually been decreased from the FY 1999 budget. Pillard said they were approximately the same. Dunlap believed the Conservation Department's budget did not increase, even though increased property assessments should have caused an increase. Slockett said the allocation of property taxes to the Conservation Department had increased from $680,653 to $681,193. Jordahl explained to Dunlap that for most departments, line items for machinery were taken from departments' base budgets and put into separate capital expenditure budgets, but the Board could not do that with the Conservation Department because of REAP eligibility. Dunlap also inquired about his request for savings to be started for future equipment purchases. Jordahl said savings accounts could not be made within departmental operating budgets, and funds in separate savings accounts for equipment purchases would not count in meeting REAP eligibility. Jordahl asked Slockett if there was a way to set funds aside for capital expenditures, since conservation trust moneys could only be used for land acquisition and capital projects. Slockett said the State Conservation people said it was not possible, but Slockett felt it could be possible but would entail dealing with the State Auditor and the Attorney General. Dunlap said there was not any budget increase for his department from FY 1999 to FY 2000, that his department was absorbing the cost of living. Jordahl said the Conservation Department's budget was larger in comparison to other departments because capital expenditures were left within Conservation's operating budget, that the Board did not cut or transfer funds for capital expenditures in Conservation as it did in other departments and Conservation was left with more freedom to spend its funds than other departments.

Stutsman said that the Board did not agree to fund an additional staff person and additional moneys for tree replacement. Dunlap said he could understand not funding additional staff but was surprised that the Board did not fund tree replacement which would have a 100 year environmental impact. Jordahl questioned the Conservation Department having $30,000 within their base budget for additional staff but not enough for tree replacement. Dunlap said the additional staff would be needed for the tree replacement in Kent Park, and his department had not had a staff increase in over 10 years. Jordahl reiterated that the Conservation Department budgeting enough funds within their base budget to hire an additional staff person demonstrated enough budget flexibility to fund trees within their base budget. Dunlap said his department tried to prioritize and cover the most important items within their base budget, that the needs of the Conservation Department changed greatly from year to year and multi-year budgeting was done as a result. Dunlap continued by saying the Conservation Department's budget requests were realistic of their needs but the funds allocated by the Board were not always so. Dunlap cited a request for one full-time staff person for FY 1999 and funds were allocated for a half-time position even though the Conservation Department didn't hire half-time staff. He spoke of his belief that the Board expected to operate on the same budget as the previous year though a devastating storm has occurred which destroyed thousands of trees. Jordahl asked about FEMA money which was used to pay for tree damage the previous year. Dunlap said FEMA money had not yet been transferred. Jordahl asked Slockett if he could find out if FEMA money had already been deposited in the County budget, and Duffy volunteered to investigate the delay in FEMA funding. Slockett said Dunlap could budget FEMA money as increased revenue if it was expected to come in during the fiscal year, because it would not effect the overall tax levy.

Edwards said the amount of money available in the rural basic fund to transfer to Secondary Roads was over $500,000, actually $569,000 was available so the tax asking for County units would be lower than what was estimated on the budget worksheet. Edwards added that approximately $30,000 would provide a cushion to remain qualified for State and Federal funding assistance. Jordahl noted that this would lower the tax levy most greatly for farmers. Stutsman said the Conservation Board would be very upset if a tax cut was provided while they believed they were underfunded. Thompson suggested having a 0% tax levy change for agricultural areas and using left over funds to lessen the tax levy in FY 2001. Duffy expressed concern over the tax asking increase for commercial property in Iowa City. Board members discussed how increased assessor valuations helped explain tax levy changes, which should be explained to the public.

The Board discussed scheduling to work on their press release regarding the budget.

Adjourned at 12:11 p.m.

Attest: Tom Slockett, Auditor

By Casie Parkins, Recording Secretary