The county’s next fiscal year begins Jan. 1.
The council unanimously approved a budget at its Dec. 19 meeting that calls for $80.4 million in general fund expenditures. Councilmember John White [District 7] was absent. The general fund supports most of the county’s administrative departments.
The budget includes a 1-percent pay increase for about 1,000 county employees even though the council chose not to withdraw from an annual back-to-school sales tax holiday next summer. Earlier, county officials said it was necessary to guarantee a half- percent of that pay hike.
Budget planning and discussions this year occurred amidst a background of financial problems that emerged in 2016. Rising medical claims are the major culprit contributing to a 2017 county budget that adds few new employees and the minuscule salary increase for present ones. County officials also are worried about providing more money for law enforcement, particularly given the rise in heroin use.
Even through sale tax collections – more than 60 percent of general fund revenues – are ahead of projections, increased medical claims paid by the county’s self-insurance program ate up money in the general fund.
“While in the past we have managed the ups and downs of the health care needs of our employees, changing costs in the last nine months have raised a concern about whether changes in the health care market are resulting in a permanent increase in our costs rather than a temporary storm,” said County Executive Steve Ehlmann said in his budget message to the council in November.
The $2.4 million, plus the $2.1 million transferred to the self-insurance fund in October, has “virtually eliminated general fund dollars for other matters,” Ehlmann added.
At its Dec. 19 meeting, councilmembers warned that the county may need to search for other financial options to raise revenues. But the issue was further complicated when the council was asked recently to pass a separate bill related to the budget amending the county’s personnel plan, particularly a modification to the paid hours used in calculating overtime pay to hourly employees.
The modification could save the county as much as $300,000; however, councilmembers said they plan to revisit the overtime issue as early as next month after hearing employee concerns.
Overtime would be paid only when a county employee has worked on or in conjunction with an official county holiday. Employees will not be able to include compensatory time off or paid time off in figuring overtime.
That provision prompted one county employee to object during the public comment portion of the meeting and caused Councilmember Joe Brazil [District 2] to raise questions as the council was poised to vote for it. Brazil, who received calls from county employees worried about the change, said there hasn’t been enough conversation about the bill.
“You’re attacking us like we wanted to do this; we’re facing some financial realities,” said Joann Leykam, the county’s director of administration. Leykam said the county was pulling back to standards that are followed by private industry and other local governments.
Brazil said he wasn’t “throwing [Leykam] under the bus,” but the council had not discussed some aspects of the bill. Overtime was part of the benefits and pay package that employees receive.
“You can’t do a handshake and then change the plan; it’s not fair,” Brazil said.
Brazil proposed amending the bill to strike out the section on overtime pay and allowing the council to review it in January. But Leykam and Bob Schnur, the county’s financial director, said failure to pass the bill would not allow the 1-percent pay raise to go into effect in three days or the county to hire new employees.
The council voted 3-3 on Brazil’s amendment and it failed. Other questions were raised about the council’s ability to amend the bill given another ordinance it passed recently, calling for the council to vote on amendments made at its next meeting.
After a prolonged discussion, the council agreed to pass the bill after Council Chairman Joe Cronin [District 1] suggested that Brazil and Councilmember Michael Klinghammer [District 6] review the bill with the council possibly revising it next year.
“You can always change your mind,” Ehlmann said.
The vote was 4-2 with Brazil and Councilmember David Hammond [District 4] voting no.
Cronin said the county will have to find other revenue sources and that he was exploring options, including a small property tax increase. Ehlmann noted that county could still face some financial issues late next year.
Ehlmann likened the budget situation next year to how Missouri appropriates money. The Missouri General Assembly appropriates money, but sometimes leaves the task of balancing the state’s budget to the governor if the state doesn’t have enough money.
“Everything will be fine as long as our [sales tax] money comes in a little bit higher than what Bob [Schnur] has projected,” Ehlmann said. “If it comes in the same as or comes in less than that, we’re going to have to do something because we have a charter obligation to not spend more than we have.”
Meanwhile, the council withdrew a bill to opt out of the back-to-school sales tax holiday on Friday, Aug. 4 through Sunday, Aug. 6. The holiday exempts items such as clothing, school supplies and computers from state sales tax. Municipalities and county governments can also waive theirs sales taxes for that weekend or can opt out of participating.
Not participating might provide anywhere from $240,000 to $163,000 in revenue that county officials said would have gone for a half percent merit increase. During budget discussions, county officials said without the resolution, the county pay increase might shrink to half a percent.
But Councilmember Mike Elam [District 3] and another council member objected at a Dec. 5 work session to withdrawing the county’s participation saying it would harm businesses. Elam questioned if the sales tax brought in would be as high as county officials anticipated. “It’s a false number,” he said at the Dec. 5 meeting.
At the Dec. 19 meeting, the council also approved a bill establishing a county law enforcement restitution fund to supplement law enforcement expenses including those of the prosecuting attorney’s office. The bill allows circuit judges to impose a $100 fee to persons convicted of felonies or who make guilty pleas. But money from the fund can’t be spent unless approved by a five-member board of trustees appointed by the county executive.