Genesee County Budget

2019 Budget Officer's Proposed Budget

TO:            Genesee County Legislators, Fellow Employees and Geneseeans

FROM:             Jay A. Gsell, County Manager/Budget Officer

DATE:             October 26, 2018

SUBJECT:       Genesee County Manager's Proposed 2019 Budget

The proposed 2019 Genesee County Manager’s Budget (My 24th such fiscal plan) includes a General fund appropriation recommendation of $112,861,736 which is approximately $7.9 million greater than the adopted 2018 General Fund appropriation of $104,924,228 or a 7.5% increase over the 2018 appropriation.

This proposal is the center piece of a larger all funds Genesee County budget proposed of $140,523,853.  The $27,662,117 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 2019 County Manager’s proposed budget includes a property tax levy of $30,292,091 which translates, with our taxable assessed value growth adjustment, to a $10.04/$1,000, 2019 proposed property tax rate; the 2018 general County property tax adopted budget rate is $10.07.

The 2019 proposals received from the various County departments and supported agencies initially represented an almost $700,000 increase in appropriations and a preliminary tax rate of $10.27/$1,000.  With the advent of the new 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, the various departments and the budget office in consultation with the County Legislature and County Treasurer have worked to ensure this proposed budget is under the tax cap constraints and thus the $10.04/$1,000 recommended property tax rate.

This budget proposal includes the recommended use of $1,559,778 in unappropriated, undesignated fund balance ( over the past 9 CFYs, the average fund balance used in the County budget has been $2,767,000),  leaving the unassigned general fund balance at approximately $13.5 million or 12% of appropriation, within the recommended NYSOCS and bond rating agencies (S&P, Moodys) guidance.

This “balanced” budget proposal not only stays within the 8th year of the property tax levy growth limitation profiled by New York State but reduces the potential property tax rate by $0.03 while not eviscerating services or making continued reductions to 12 outside agencies funding which totals approximately $1,282,773.  All but one of the entities will see level County support for 2019, the sole exception is the Genesee County Economic Development Center (GCEDC) which asked for a new five year plan and gradual commitment of increased funding for their core /essential operations and marketing expenses which the County Legislature is amenable to.   The assets across the County which GCEDC is marketing and trying to entice new investment in, including the Agri-Business Park, Buffalo East Technology Park, Apple Tree Acres, LeRoy Business Park and STAMP as well as Gateway II in the Town of Batavia finds GCEDC at a crossroads of County funding support vs. restricted revenue generated from land sales and grants and after 5-7 years of reductions in County support GCEDC is being constrained in what they can accomplish and the partnership with regional economic development entities and New York State ESD resources.  The 2019 increase of $40,000 in Genesee County support to the GCEDC operating budget is considered an investment in the long term growth in new/retained business and industry and employment opportunities with still no capital/site development commitment by the County to the various GCEDC assets/Business Parks.

The 2019 County Manager’s proposed General Fund budget includes a property levy increase of $366,819 over the 2018 Adopted County budget levy.  The October 1, 2018 Raise the Age mandate pretty much makes exceeding the New York State property tax levy limit a non-option for New York State counties.  With the almost $2 million/year potential cost increase in various County human service and criminal justice services budgets included in this 2019 proposal,  not being able to be reimbursed 100% by New York State is not a risk this County can take. It is highly likely given New York State’s penchant for trickling down service mandates and cost sharing to counties that this tax cap levy restriction will become more onerous and inviolate as Albany continues to pillory local governments (City/County/towns/villages and schools) for the relatively high property taxes we are collectively levying while the State uses certain creative fiscal/off budget solutions to stay within Governor Cuomo’s State budget growth cap of allegedly 2%.  The Genesee County 2019 budget “assumes” 100% RTA State reimbursement and thus hopefully no property tax impact.

The 2019 proposed Genesee county Manager’s budget includes in addition to possible RTA mandated expenses, 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 2019 proposed budget, these mandated services will consume approximately 74% of the recommended County property levy or $22,389,168.  The largest of these County cost sharing programs is Medicaid at $9.5 million within the Department of Social Services (DSS) budget which leverages approximately $95 million in County, State and federal “indigent” health care/long term care resources annually coming into this community to support 12,500 Medicaid 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 $ 12,824,368 in net county cost and a further drain on the property tax levy for 2019.  In spite of our local governments’ long history of shared services, consolidation of services, i.e. E911 dispatch, youth bureaus, County Health Departments, The Courts Facility, County Highway road projects and collaboration which was profiled in our 2018 NYS mandated Shared Services Plan (which was filed on September 15, 2018)  continued and new initiatives and opportunities can only achieve “savings” which do not keep pace with the continued cost growth in 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.

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 20 year history of County Highway and local municipal highway departments spring and summer road improvement cooperative agreements and snow and ice contracts with towns and villages 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 and village governments.  While our 2018 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 deliver the quality essential services that our tax payers deserve and expect.

This budget proposal does include the following full time personnel changes for one additional Assistant District Attorney for the District Attorney’s Office = $125,031 salary and benefits; a Parks and Forest Building Maintenance Mechanic at approximately $63,182 that is part of a potential county Highway management/services reorganization that could reduce the net 2019 impact to approximately $32,000 and in the Public Defender’s Office 2.5 new Assistant Public Defenders that are 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. Two Department of Social Services /RTA, State mandated support staff are also included at $117,000 total expense with expected 100% reimbursement.  Finally a County Mental Health change in “internal” transportation services would result in a net County cost increase of approximately $10,500.

Ongoing 2018 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 first ever compliance officer,  are now part of the daily efforts to provide essential/mandated services and to secure $11 million annually in federal funding which comes with increasing transparency and accountability and more frequent State and federal “audits”.

The County is maintaining level funding as the host/sponsor County for Genesee Community College (GCC) operating budget support at $2,586,374.  This support was mutually agreed upon by the County Legislature and GCC Trustees/Administration as part of the GCC budget adoption in July 2018 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 four county higher education “cooperative” is both affordable and top quality post-secondary education and very accessible for the GLOW region.

The Chamber of Commerce and their Tourism Promotion program which is 100% funded by bed tax revenues is also part of the  County 2019 budget proposal = $420,000.  With County sales tax proceeds enjoying a strong growth % in 2018 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 have 2019 increments agreed to and our 102 management and support personnel performance evaluation system provides an approximate 2% salary increment for 2019.  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 26% of our FTE’s.  Employee self-funded healthcare costs are anticipated to increase 3% over 2018 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 =$6,456 and family plan =$20,976) while we are seeking more and more employee premium cost sharing = at least 10% - 20% /pay period.

The County’s share of our much improved self-funded Worker’s Compensation program is also slated to decrease by about $142,000 in an overall plan of approximately $2.3 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.

Savings/restructuring initiatives for the former County Motor Pool of approximately 50 vehicles with Enterprise Fleet Management continues along with our 2018 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 or operated facilities.

This 2019 Budget proposal also includes approximately $2.3 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 28, 2018.  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 share to around a 40-45% “sponsor” share for facilities like the Call Event Center and Student Improvement Center.

As highlighted in the 2019 Proposed County Budget, the County is now on a 3.5 – 4 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 special segregation dictates require.  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 50 year horizon of anywhere from 124-184 beds at hopefully a 9 acre County owned site adjacent to County Building II (West Main Road).  A taskforce and planning group has been empaneled by the County Legislature to help the County perform due diligence and retain our 10 bed current facility variance with a 3.5-4 year deadline to have a new $42 - $54 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 initiated a revised 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 2020.

With this 2019 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, 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, allegedly “discretionary” services and programs is 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 7, 2018 in the Old Courthouse.  The adoption of the County Legislature’s final 2019 budget is expected on November 28, 2018.

Again as we did in preparing the 2018 County Budget, the departments of County government and the Budget Office will update our recent 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, so our solutions and opportunities are squarely in our laps.

While continued discussions and negotiations over the next 2-3 Phases 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 2018 deadline to amend and extend the Countywide sales tax sharing “formulas” is 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 being negotiated with the intent and goal to increase readily available, potable water capacity to at least 17.0 mgd by 2022.  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 3-4 years. The potential sales tax proceeds sharing formula being modified to provide the County with sufficient revenue to cover infrastructure debt payments for roads and bridges and very likely within the next 3-4 years a new 124-184 bed male/female County jail; Genesee county is preparing 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.  The County and City of Batavia recently extended the Sales Tax 50/34/16% shares distribution for 2019 as we work 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.

The public servants of Genesee County government take our mission outlined in the front cover of this 2019 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 2019 and the annual updating of same as well as the County Smart Growth Plan periodic updates and 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 $140,523,853 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.