TO: Genesee County Legislators, Fellow Employees and Geneseeans
FROM: Jay A. Gsell, County Manager/Budget Officer
DATE: October 22, 2019
SUBJECT: Genesee County Manager's Proposed 2020 Budget
The proposed 2020 Genesee County Manager’s Budget includes a General fund appropriation recommendation of $114,048,256 which is approximately $13,030 less than the adopted 2019 General Fund appropriation of $114,061,286 or a .01% decrease over the 2019 appropriation.
This proposal is the center piece of a larger all funds Genesee County budget proposed of $143,971,732. The $29,923,476 in related funds/activities of County government such as County Road, Risk Retention, Workers Compensation, Job Development, etc. have direct ties as to the “net” support that is provided to those funds/activities from the County general fund.
This 2020 County Manager’s proposed budget includes a property tax levy of $31,037,076 which translates, with our taxable assessed value growth adjustment, to a $10.11/$1,000, 2020 proposed property tax rate; the 2019 general County property tax adopted budget rate is $10.04.
The 2020 proposals received from the various County departments and supported agencies initially represented an almost $1,048,000 increase in appropriations and a preliminary tax rate of $10.47/$1,000. The advent of the second year of Raise the Age (RTA), 16 and 17 year old offender State mandate being tied to County expense reimbursement by the State only if the adopted budget property tax levy remains under the 2% State levy restriction on growth and the new wrinkle via state mandate which is Bail Reform and expedited discovery timelines within criminal justice system and the impact on District Attorney, Sheriff, Probation and Genesee Justice impose a constraint on the County property tax rate/levy in conjunction with the now permanent tax cap growth limitation on the levy. The various departments and the budget office in consultation with the County Legislature and County Treasurer have worked to ensure this proposed budget is slightly under the tax cap constraints and thus the $10.11/$1,000 recommended property tax rate.
This budget proposal includes the recommended use of $1,750,000 in unappropriated, undesignated fund balance ( over the past 9 CFYs, the average fund balance used in the County budget has been $2,769,000), leaving the unassigned general fund balance at approximately $14.0 million or 12% of general fund appropriation, within the recommended NYSOCS and bond rating agencies (S&P, Moodys) guidance.
This “balanced” budget proposal, if adopted as presented, would not require a County Legislature Tax Cap levy limit override as part of the 2020 County Budget Adoption process. To ensure that outside agencies with any County General Fund support are all recommended for the same funding as in the 2019 budget. The GCC already adopted 2019/20 budget does include a $50,000 additional County/sponsor funding increase which the County Legislature committed to in June 2019.
The pending capital commitment to a new County Jail and resulting “mandate” by the State of New York Commission of Correction to put in place a 4 person jail transition team once the project shovel digs its first footing East of County Building II is being deferred and will be “funded” by infrastructure funding, not the 2020 General Fund most likely in late 2020. The certainty of our now approved 40 year sales tax sharing legislation with the City of Batavia should facilitate this Capital Project and long term debt service/bonding being authorized in late 2019 or early/mid 2020. The Jail Task Force and consultants should be continuing the 90% schematic design and due diligence within the next 60 days.
The 2019 Adopted budget included an almost $1.9 million increase in Raise the Age – State mandated estimated expenses with 100% offsetting reimbursement which thankfully did not come to fruition. With the second step of this mandate for dealing with “adolescent offenders” age 16 & 17 now in place as of October 1, 2019, Genesee County cases and costs are minimal and limited State reimbursement for 2018/19 costs dealing only with 16 year olds is about $7,000 of eligible, incremental costs of this Albany “feel good” Legislative mandate. The 2020 estimate for these expenses is $318,373 with expected 100% NYS reimbursement/offset revenues.
The 2020 County Manager’s proposed General Fund budget includes a property levy increase of $744,985 over the 2019 Adopted County budget levy which is slightly under the allowable tax cap growth of $759,567. (See attached NYS formula for Tax Cap Levy Growth)
The 2020 proposed Genesee County Manager’s budget includes the ongoing 8-9 New York State mandated local fiscal shares and program delivery obligations that New York State county governments can neither change nor participate in the “reform” of such entitlements, many of which originated in the 1960’s from the federal Great Society “reforms”. For the 2020 proposed budget, these mandated services will consume approximately 74% of the recommended County property levy or $22,872,275. The largest of these County cost sharing programs is Medicaid at $9.36 million ($180,000/ weekly share) within the Department of Social Services (DSS) budget which leverages approximately $110 million in County, State and federal “indigent” health care/long term care resources annually coming into this community to support 12,500 Medicaid/Genesee County recipients enrolled in this entitlement. As much as this mandated healthcare plan may be despised by many taxpayers, our local/regional providers and healthcare institutions derive a decent “benefit vs. bad debt and charity care were Medicaid not a “payor”.
The other New York State mandated programs/services include Indigent Defense, Pre K/EI handicapped children’s services in the Department of Health, Probation, Mental Health, the County Jail, Safety Net, TANF/Family Assistance, Child Welfare and Youth Detention which collectively require $ 13,512,275 in net county cost and a further drain on the property tax levy for 2020. In spite of our local governments’ long history of shared services, consolidation of services, i.e. E911 dispatch, youth bureaus administration (3), Genesee/Orleans County Health Department, The Courts Facility, County Highway road projects and collaboration which was profiled in our 2018/19 NYS mandated Shared Services Plan (which was filed on September 15, 2018), continued and new initiatives and opportunities can only achieve modest “savings” which do not keep pace with the continued cost growth in State/federal entitlement program local shares and continued pressure on the property tax levy of all Genesee County public sector providers. We continue to explore and look for more such shared services/collaborations each year and will file our annual plan updates with NYS Department of State in late 2019/early 2020.
As indicated, the County will be continuing its long standing shared services ventures like our Joint Genesee/Orleans County Health department merger, Genesee, Orleans and City of Batavia merged Youth Bureaus, the 21 year history of County Highway and local municipal highway departments spring and summer road improvement cooperative agreements and updated snow and ice contracts with towns to keep County roads safe and passable in the winter and thus allowing the County Highway Department to strategically reduce our workforce and plow truck fleet which “saves” the County money/overhead costs and is a win-win for ourselves and town governments. While our 2018/19 New York State shared services plan was somewhat under-whelming, our history of these type of initiatives over the past 30 years, has made it somewhat more difficult to identify new opportunities that would net “save” all participating public sector entities expenses and continue to deliver the quality essential services that our tax payers deserve and expect.
This budget proposal does include the following personnel changes: One additional FT Assistant District Attorney salary and benefits; a part time ADA and paralegal to deal with new discovery and bail reform mandates and in the Public Defender’s Office a new Paralegal that is 100% cost reimbursed by the NYSOILS quality improvement initiative and the statewide plan to have counsel upon first arraignment at all preliminary judicial proceedings aka the Hurrell-Harring plan. In DSS, Probation, Mental Health and the Sheriff’s Department, RTA State mandated costs are also included at the aforementioned estimated expense of $ 318,000 with expected 100% reimbursement.
Ongoing staff enhancements in County Highway, County Information Technology, DSS-Assistant County Attorney staff and Human Resources support staff along with Sheriff’s Communication quality control and report preparation/submittals person and County Manager staff- our corporate compliance officer version 2.0, are now part of the daily efforts to provide essential/mandated services and to secure $12 million annually in State and federal funding which comes with increasing transparency and accountability and more frequent State and federal “audits”.
The County is increasing funding as the host/sponsor County for the Genesee Community College (GCC) operating budget support at $2,636,374. This $50,000 additional support was mutually agreed upon by the County Legislature and GCC Trustees/Administration as part of the GCC budget adoption in June 2019 and subsequent submittal to SUNY for tuition and operating budget State Aid. Genesee County continues to be one of the lowest contributing county sponsors in the State, both dollar wise and at approximately 6% of revenue needs within a $40 million annual budget. Our GLOW four county higher education “cooperative” is both affordable and provides top quality post-secondary education and very accessible for the GLOW region at the main campus and the 6 other campus centers.
The Chamber of Commerce and their Tourism Promotion program which is 100% funded by bed tax revenues is also part of the County 2020 budget proposal = $420,000. With County sales tax proceeds enjoying a modest growth (2%) in 2019 y-t-d and Darien Lake Theme Park/concert venue enjoying a strong season, the domino effect of tourism outreach and promotion across New York State and the adjoining states of New Jersey, Pennsylvania, and Connecticut is very much in evidence.
Compensation changes for our approximately 452 FTE’s are included in this proposal. All four collective bargaining agreements are being presently renegotiated in late 2019 and a contingency has been embedded in this 2020 budget proposal and our 102 management and support personnel performance evaluation system provides an approximate 1.5% salary increment for 2020. Anticipated cost for New York State pension employer contributions are basically flat due to a number of new employees almost all of whom are Tier VI lifetime contributors and make up about 32% of our FTE’s. Employee self-funded healthcare costs are anticipated to increase 10% over 2019 costs in what has become a very fluid and shifting cost center with both our number of high cost claims ($25,000 + per individual) and Prescription expenses for our County/GCC employees and their dependents increasing at a notable rate/year. We continue to work with our TPA: Independent Health and consultants, Premier Consulting Associates to introduce high deductible/HSA plan options and offer incentives for employees to retain non-County credible health plan alternative coverage (Our single plan =$7,356 and family plan =$23,916) while we are seeking more employee premium cost sharing presently ranging from 12% - 20% /pay period. As well as imbedding other cost containment/cost savings into the primary Health and Wellness plan that reflect 21st Century health care.
The County’s share of our much improved self-funded Worker’s Compensation program is also slated to increase by about $26,747 in an overall plan of approximately $2.2 million which covers the County, towns, villages, schools and volunteer fire departments and a few special agencies dating back to 1956. Using 21st Century actuarial tables and risk assessment/valuation, the County self-funded plan has become a more strategic and return to work/injury avoidance plan and not just a payer of claims.
Savings/restructuring initiatives for the former County Motor Pool of approximately 54 vehicles with Enterprise Fleet Management continues along with our 2018/19 funded energy efficiency and building operation Capital Improvement Project in partnership with Johnson Controls with net savings of approximately $200,000/year in heat/natural gas and electric charges for almost all of our 15+ County owned /operated or leased facilities.
This 2020 Budget proposal also includes approximately $3.18 million in equipment, technology and infrastructure projects which we separate into asset acquisitions and capital projects which the county Legislature adopts as part of specific resolutions once the overall budget is adopted likely as of November 25, 2019. The funding comes from a portion of the County’s 1% sales tax proceeds which also funds ongoing debt service for both the County share of our own Capital Improvement Projects and net State Aid/GCC foundation Capital Improvement Projects which of late help reduce the County’s investment to around a 40-45% “sponsor” share for facilities like the Call Event Center and Student Improvement Center at GCC main campus.
As highlighted in the 2019 Proposed County Budget, the County is now on a 2.5 – 3 year timeline to plan and build a new County – New York State mandate compliant-jail under 21st Century custodial guidelines and best practices for both male and female detainees and as “direct” supervision and special segregation/classification dictates. Our present early 20th century with two additions, 88 bed, and “males only” jail is neither size nor safe custody and care appropriate. Our preliminary plans indicate a 40 year horizon of anywhere from 160-192 beds at an 11 acre County owned site adjacent to County Building II (West Main Road). A taskforce and planning group has been working diligently to help the County perform due diligence and retain our 10 bed current facility variance with the 2.5-3 year deadline to have a new approximately $63 million facility up and running. Coupled with our need to commit to a more aggressive 10 year road and bridge repair/replacement program of approximately $55 million, the County has just secured NYS approval of a revised 40 year “sharing plan” of the 50% of local 4% sales tax sharing formula for the City and towns and villages that will provide the County with more sales tax funds to offset debt service for these two major commitments and negate implications for our property tax levy and the State imposed tax cap restrictions, starting in CFY 2021. City/County sales tax sharing and Towns/Village revenue distribution going forward will stabilize major infrastructure funding for both the City and County and provide a known annual revenue stream for the Towns and Villages.
With this 2020 budget, Genesee County continues its tradition of fiscally responsible and conservative expenditures, a blending of technology and a trained and committed workforce to carry out our daily service commitments as efficiently as practicable and reinforcing an ethos to quality customer/tax payer service and safe workplace environments.
As we continue to wend our way through the labyrinth of New York State Mandates and lack of said mandate relief from Albany, new challenges like Raise the Age and Indigent Defense – counsel upon1st arraignment mandates and most recently Bail Reform and Discovery shortened deadlines effective January 1, 2020, the federal tinkering with Medicaid and ACA health care carve outs and federal deficit reduction musical chairs, our continued attention to reasonable quality of life, commitment to allegedly “discretionary” services and programs are a critical part of our foundation of Genesee County Government and our commitment to excellence.
The Public Hearing for the county Manager’s recommended budget will take place on Wednesday, November 6, 2019 in the Old Courthouse. The adoption of the County Legislature’s final 2020 budget is expected on November 25, 2019.
Again as we did in preparing the 2019 County Budget, the departments of County government and the Budget Office will update our 5 year County budget profile which incorporates New York State Comptrollers fiscal stress monitoring criteria and ICMA financial trend monitoring information to help County government gauge our present and future fiscal stressors, what changes need to be considered and how long term funding for capital improvements over the next 20 -30 years will be addressed and paid for. At this time, the New York State Comptroller’s Office has again profiled Genesee County as not experiencing fiscal stress and our S&P bond rating of AA- is both steady and sustainable and was reaffirmed earlier this summer, so our long term debt solutions and opportunities are squarely in our laps and locally determinable.
While continued discussions and negotiations over the next Phases II and III of the Countywide water project and water surcharge rates to fund up to $88 million in future water infrastructure – transmission mains, pump stations and water towers – are moving forward, the December 2019 deadline to amend and extend the Countywide sales tax sharing “formulas” with NYS approval of a new 40 year sharing agreement are inextricably linked to the water capacity enhancements and our now reconstituted master water agreement with the Monroe County Water Authority. There are a lot of moving parts and ongoing revised intermunicpal water infrastructure agreements have been negotiated with the intent and goal to increase readily available, potable water capacity to at least 17.0 mgd by 2022 or up to 22 mgd in 2024. Coupled with the previously mentioned need to fund 7 – 10 year road and bridge infrastructure projects the county is seeking dedicated and consistent revenue support for both water capacity infrastructure via the “water use” surcharge increasing initially by $0.60/1,000 gallons and modest increases to same in the next 3-5 years. With the sales tax proceeds/ revenue distribution sharing formula approved by the NYS Governor and NYS OSC to provide the County with sufficient revenue to cover infrastructure debt payments for roads and bridges and very likely within the next 2-3 years a new 160-192 bed male/female County jail, Genesee County has prepared multiyear water and road/bridge and facilities capital plans that will also help in seeking possible grants and loans to ease the local residents tax burden. Last year the County and City of Batavia extended for 1 year the Sales Tax 50/34/16% shares distribution for 2019 as we worked with New York State and our local government partners to secure a 40 year revised sales tax sharing plan for the County debt and “infrastructure” needs. As of this week – Mission Accomplished!
One other new wrinkle in county sales tax revenues is the State unilateral grab of former State AIM payments to other local governments from the County’s local sales tax quarterly payments. In 2019/2020, this will reduce the County’s net sales tax proceeds by $303,000 so the State can continue to payout that money to Towns and Villages but save itself that level of State appropriation – one more insidious “unfunded” mandate dropped in our fiscal laps.
The public servants of Genesee County government take our mission outlined in the front cover of this 2020 proposed budget very seriously and the overarching strategy and attention to detail in our County Comprehensive Plan which we hope to do a major overhaul to in 2020 and the annual updating of same as well as the County Smart Growth Plan every three year updates and daily citizen involvement ensures accountability, transparency, cost effective services and an overall selfless attitude by all members of our workforce starting with the 9 County Legislators and across all departments and related agency partners in the public/non-profit sector who are the stakeholders and enablers of this $143,971,732 County Budget proposed plan. Planning, preparedness and long term projections are keys to our future and our ability to be the most efficient and cost effective local government entity that we can be.
TAX CAP CALCULATION
Total Property Taxes levied for 2019 $30,292,091
Multiply by Quantity Change Factor 1.0042
Add PILOT pymts receivable in 2019 272,062
Multiply by allowable levy growth 1.0200
Subtract PILOT pymts receivable in 2020 (253,549)
Add Carryover of prior fiscal year 0
Add excludable portion of retirement 0
TOTAL TAX LEVY LIMIT FOR 2020 $31,051,658