County looks at cost saving measures
FY2021 Budget talks underway
REED CITY -- Looming budget shortfalls due to the coronavirus pandemic has county officials looking for ways to cut expenditures for fiscal year 2021.
The Osceola County Board of Commissioners finance committee began budget meetings in June to look for ways to trim their budget.
County treasurer Lori Leudeman presented the committee with ideas from various department heads that included revenue generating options, as well as revenue saving ideas.
Leudeman told the committee that Sheriff Ed Williams has suggested moving from a 37 1/2 hour work week to a 35 hour work week, saying if 10 employees' weekly hours were reduced, it would result in a savings of 50 work hours each week.
"The exact monetary savings would depend on the employee's rate of pay and what the employee pays into the retirement fund," Leudeman said.
Another suggestion from the MSU Extension office was to combine work between employees and/or departments.
"They feel they need a person in the office every day, but that person could also take on work from other departments if they are shorthanded," Leudeman said.
VanderPol added that sharing duties between departments is something the county has traditionally done.
"My office and the equalization department are sharing an employee," Vander Pol said. "Additionally, we have held off on filling vacant positions for a while now."
"There are times when we see a one-man office, for whatever reason, and I've told them if they need anything to call," added County Clerk Karen Bluhm. "That's' just the way we do business. Most of the people in our building have been willing to do that."
Leudeman told the committee they could expect a savings of around $46,000 in the general fund of monies budgeted for travel and conferences for 2020.
"We originally budgeted $53,000 for conference and travel expenses, and have only used $7,000," Leudeman said. "So that is a savings of around $46,000."
In addition, she said, there is an employee retiring and the new hire will come in at a lower level, so there may be some savings there, although she wasn't sure of the amount.
County coordinator Susan Vander Pol said any savings on the new hire could potentially be offset by the cost of employee insurance, depending on what that employee signs up for, so they couldn't really count on that savings.
Leudeman also told the committee there could be some potential general fund monies available in the Osceola County Home Repair Program fund.
The county receives funding from the federal housing commission to assist low income residents with home repairs. Once repairs are completed, there is a lien put on the property for the amount of the repairs. When the property sells, that money is paid back to the county.
According to Osceola County Community development Coordinator Dan Massey, the money coming back to the county this year is round $24,000. After deducting a percentage for administrative costs, there would be approximately $19,600 that could go back into the general fund, he said.
"The rule is if you take back less that $35,000, you can take the money and use it however you want," Leudeman said. "If it is more than $35,000, you have to keep it in the housing fund and continue to do projects for people. He (Massey) suggested we take it for the general fund."
Massey said the county currently has almost $700,000 still out on liens right now, but the amount that comes in each year ranges from $0 to $50,000.
Other cost saving measures being considered include changes in the employee retirement and health benefits program, extending the employee furlough program, and increasing the county operating millage.
According to Bluhm, the cost savings for the employee furlough for the seven weeks of the $600 federal stipend period comes to around $39,000.
BOC member Timothy Michell has suggested that the board extend the furlough program to the end of the year in order to save additional funds.
"If someone makes $1,300 per week, with the stipend they receive a bonus of $2,884 for the seven-week period." Michell said. "If the stipend ends, and that employee remains on furlough, they would still receive a bonus of $1,600 per week, with the state paid portion of the unemployment. If we extended the program for five more weeks until the end of August, we could possibly save an additional $37,000."
"Right now, it looks like they are going to bill us for the unemployment liability," Bluhm said. "The workshare state funding was supposed to last through the state of emergency, and we thought we weren't going to have to pay for the unemployment, but if we do, there goes the savings."
"Most of these employees went willingly into the program thinking it would end when the stipend ended," she continued. "They are taking a hit to help the general fund."
VanderPol said they are not sure what the situation is with respect to the state paying the unemployment, but they are working to get the information they need.
"The workshare program is a federal program, and our understanding was that it would be covered, but now we just don't know," she said.
Leudeman suggested the BOC could propose a vote to get the county operations millage back up to 6.75 mills.
"We did have a roll back this year, the first one in 12 years, down to 6.399 mills," she said. "That is something the board may want to discuss."
Michell agreed that it was something they should consider.
"One mill typically generates around $650,000," Michell said. "That increase would be about 4/10 of a mill, so that should be around $260,000 in additional funding."
In addition, Leudeman said, the sheriff's department is optimistic about increasing revenue with the jail space, as well as video visitation.
"Just like the visitors now pay for telephone visitation, they will pay for video visitation," she said. "With all of it, they are looking at a possible revenue increase of $250,000 to $500,000."
The BOC will be looking at cost saving changes to the employee retirement and health care programs in upcoming meetings.
"In a new program, you could have a defined contribution plan limiting what the county's contribution will be, and you can eliminate the long term liability because it is treated like a 401K," VanderPol said. "Getting new employees into a finite plan will be beneficial to the county in the long run."
A survey is being sent out to all county employees to get input on cost saving ideas, including employee benefits, and reduced working hours.
The finance committee will meet at 9:30 a.m., Sept. 30.
For information on how to participate in the meeting visit Osceola-county.org, or call (231) 832-3261.