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| Oneida County can't overcome past excesses, loss of state inmates |
| By lakelandtimes.com - Richard Moore |
| Published: 10/28/2011 |
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In this year's budget cycle Oneida County supervisors faced not only a changing political landscape but the harvest of their own past decisions, and, in the end, as the budget is trucked to county board market, taxpayers will likely end up paying more for the produce. Nearly $400,000 more, to be exact, if the fiscal document approved by the county's finance committee holds. That tally would increase the levy by $393,853, a 2.6 percent increase. The general property tax would rise from $15,063,911 to $15,457,764, while the rate per $1,000 of equalized value would climb to $2.22 from $2.06, a rise of 7.8 percent. The numbers could change - and they have in the past - when the budget goes before the county board for final approval in November. It's not that county supervisors didn't cut spending. They did. It's not that they didn't reap the benefits of Gov. Scott Walker's budget repair bill, whereby employees pay more for pensions and health benefits. They did. But past allocations of reserve funds to erase budget shortfalls and a succulent dependence on state revenues that were bound to disappear one day spelled 'tax increase' when all was said and done. Oh, there were the usual suspects. Every year the county faces a shortfall from the get-go on wage and benefit increases alone, and this year was no different. Wage and fringe increases - including cost of living step raises - totaled $270,000, while increases in health insurance boosted the levy by $160,000, or a total of $430,000, surpassing the overall increase. Increases in retirement costs raised that figure by another $65,000. Enter the Budget Repair Bill. The increase in employee contributions saved the county $75,000 in health insurance premiums, while the retirement benefit savings totaled $475,000, as county workers must now pay 50 percent of their pension contribution. On average, that's about 5.8 percent of salary. According to finance director Margie Sorenson, during 2011 most employees paid 5 percent of their health insurance premium, though protective and non-union employees paid 8 percent of the premium. "Due to contract changes allowed under the budget repair bill, all employees will be paying 8 percent of the premium, saving $75,000," Sorenson said. "The inflationary increase in health insurance is $160,000. This is even after reducing the plan benefits." Still, savings due to the budget repair bill totaled $550,000, as compared to the inflationary spiral in wages and benefits of $495,000. Not out of the woods Still, the county could not make ends meet without a tax increase, in large part due to past decisions. One of those was made last year, when the board amended the budget to take $200,000 from a segregated land purchase account and apply it to the budget to help keep the levy increase at zero. That vote passed 11-8. At the time, the land purchase account contained $494,000. It is funded through a portion of stumpage sales revenues. Of course, applying excess general fund or reserved revenues to a budget to lower the levy one year means the county has to apply the same amount of those funds the next year, or find dollars from somewhere else to plug the resulting hole, or fill the hole by increasing the levy. The latter scenario is exactly what happened. Then there is the matter of housing state inmates in the county jail, and losing them at a projected loss of $900,000. When the Oneida County jail was built in the late 1990s, some supervisors criticized the proposed expansion, saying the planned facility was too large, especially given long-range studies showing both a stabilizing Northwoods population and lower crime rates. The late supervisor Carl Hilstrom called the planned jail a "Taj Mahal," and predicted it would never be filled. The county built the jail anyway. The initial criticism was blunted, however, when the county subsequently signed a contract with the state Department of Corrections to house state inmates. Revenue swelled immediately - by the middle of the 2000s the revenue stream was hitting $700,000 - and Oneida County was using it to feed its budget, not to mention its general fund excess, which at the time was pushing into the millions of dollars. But the county was warned all along that the state would not house its inmates forever in the county jail. In fact, the state threatened to removed them in 2005, sending supervisors into hasty meetings to discuss the situation. At the time, the county housed about 50 state prisoners. At a 2005 committee meeting, Sorenson cautioned that the loss of that kind of money could be problematic at budget time, especially given the possibility of a property tax freeze, which was also looming. Her words from that 2005 meeting reverberate like an echo in 2011: "A property tax freeze is pretty much a given," she said. "But bear in mind that salaries and benefits alone will rise by about a half million dollars. So budget preparation would already seem to be a challenge, and this (the loss of jail revenue) looks like another challenge." And another challenge it was this year. Sorenson said this week that sheriff Jeff Hoffman has received more than one correspondence from the Department of Corrections indicating the state will not be contracting for county jail beds. At a September finance committee meeting, Hoffman told the panel that he had been asked back in October 2010 to raise his revenues, and he had warned then of changes in the state inmate population with a new administration arriving in Madison. In fact, he said, the number of inmates at the facility had already been declining. At one time, Hoffman told supervisors, the jail housed 60 state inmates, but that number had dropped to 30, plus 11 from McNaughton. Apart from that issue, he said, the sheriff's department budget was flat. Other counties are facing the same grim prospects, but some have options Oneida County doesn't have. Douglas County, for instance, could take prisoners from neighboring Minnesota counties. Ultimately the finance committee settled on a $900,000 reduction in planned revenues from housing state inmates, also known as a $900,000 addition to the tax levy. Add in the $200,000 land purchase hole, and the county was down $1.1 million, even with budget repair bill adjustments. That meant, as Sorenson told finance supervisors back in September, the county needed to contemplate serious cuts. Read More. |
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