County struggles to manage budget with anticipated state aid cuts
Board gets serious about cutting programs, staff
by Laura Adelmann
Thisweek Newspapers
Anticipating dramatic and permanent state aid cuts, rising insurance premiums and economic uncertainties, Dakota County officials are planning for years of financial struggles.
During a July 27 budget workshop, County Finance Director Matt Smith estimated the current $368 million county budget will drop to $313 million by 2013, a $55 million reduction.
Smith said without insurance plan modifications, the county will pay another $1.8 million for employee health insurance next year, and another $300,000 in retirement benefits.
Next year, Smith is recommending the county plan to cut its budget by $10 million.
In 2012, the county is planning for the possibility of losing another $19 million, and cuts of $26 million in 2013.
The figures are broad estimates, and could change because there are still many unknowns, including the severity of the expected state aid cuts.
In response to the anticipated budget challenges, Smith proposed earmarking a portion of the county’s fund balance to pay off bond debt over the next few years, freeing up tax levy dollars to be reallocated to cover operational costs.
In addition, the county may cut employees and programs, delay or eliminate planned improvements and purchases, raise property taxes 1 percent next year and 2 percent in both 2012 and 2013, in hopes that the actions are enough to carry through until the economy picks up by 2014 and beyond.
While commissioners and department heads have prioritized county services, with law and justice topping the list, and encouraging the public in civic affairs at the bottom, few rendered comments about which areas to cut, knowing those issues will be discussed more in depth next month.
But Commissioner Paul Krause questioned why the county is devoting $2.8 million of its budget, a disproportional amount compared to other metro counties, on preventing homelessness.
Commissioner Tom Egan said the county should not be leading an independent effort to save energy, but working with others to achieve that goal.
Commissioner Nancy Schouweiler asked if laying off workers would exacerbate the problem, and commissioners briefly debated whether employee unions would agree to multi-year wage freezes to avoid layoffs.
It was also suggested that there may be more room for reductions in higher priority areas, than in other areas where few resources are already expended.
County Administrator Brandt Richardson said they are trying to find a way to make reductions with the least amount of impact on county services, employees and residents.
“We’re going about this the right way, and as negative and awful as it is, I think it really is helpful,” Schouweiler said of the process.
Commissioners will continue budget discussions next month, with another workshop scheduled Aug. 24.
On Nov. 2, the county plans to release the administrator’s proposed budget and a public hearing on the budget and levy is Nov. 30. The final 2011 budget is set for adoption Dec. 14.
Laura Adelmann is at laura.adelmann@ecm-inc.com.
Recent Comments