County departments looking at 0 percent budget increases for FY ‘25

     As the county prepares to start working on its Fiscal Year 2025 budget, departments are being warned to plan on a 0 percent increase.

   In September, County Auditor Whitney Hein updated the Jones County Board of Supervisors on changes to the county budget process with the implementation of House File 718, known as the "property tax relief" law.

   Now, the impacts of that law are becoming a reality.

   "I'm anticipating a very tough budget season," Hein said during the Nov. 21 Jones County Supervisor meeting. "Multiple factors are going to make it more difficult.

   "One of the big things is our valuations," she continued. "Once I do taxable valuations in December, we'll look to see how much they increased over the previous year."

   Per the new law, if the county experienced a growth in taxable valuations, there is a certain formula that has to be applied to start to reduce the county's levy rates.

   "The way the law stands at this time," Hein said, "we'll have this formula in place for five years and then we'll be back to a hard cap of $3.50 (per $1,000, for the county's General Basic Fund)."

   Right now, General Basic sits at $4.15.

   "With that in mind, we really have to think about how, over the next few years, we are going to get ourselves back down to $3.50."
   The past few years, the county has had carryover funds to use for capital projects. Hein warned the supervisors that those carryover funds are dwindling.

   "Historically, we've maybe budgeted more expenditures than what we've had for revenue. Because we had this carryover, we could rely on that."

   She said this concept is no longer going to fly with the new budget process.

   "Our expenditures are going to need to be equal to our revenues or potentially less than our revenues so we can save a little in case we don't have another law change, and in five years we have to be at that $3.50 hard cap."

   Hein proposed an example of how this taxable valuation cap comes into play with limiting growth.

   Say the county saw a 3 percent growth in valuations last fiscal year. That would have meant an additional $79,000 in the Rural Basic Fund and an extra $135,000 to spend in General Basic.

   "That's not a lot when you look at inflation and all of these other factors," Hein said. "That money really doesn't go very far, which is why we've been increasing that General Basic levy rate."

   That levy rate increase is no longer an option. The cap will apply to General Basic and Rural Basic, not General Supplemental.

   "We can still increase the levy rate on (General Supplemental) without restrictions," noted Hein.

   She asked the supervisors for guidance as she starts to prepare departmental budget worksheets.

   Supervisor Ned Rohwedder suggested a 0 percent increase in budgets, but allowing department heads to factor in wage increases.

   Hein offered a several ideas she came up with…

   1. Anticipate a 0 percent increase in General Basic and Rural Basic in terms of budget amendments in March/April.

   "There would be no room to increase those two funds at that time," she suggested. "Departments could certainly move funds between line items in those funds."

   2. General Basic and Rural Basic FY 2025 fund proposals from department heads would be at 0 percent increase over the current year. But wages could increase by a certain percentage.

   3. The supervisors could decide on a hard dollar amount to dispense to outside funding requests.

   4. The supervisors could look at essential jobs versus non-essential; what's required by code versus what isn't.

   "Hopefully we don’t get to this," Hein said. "I do think, eventually, we'll have to do some trimming."

   The budgets that deal with union-mandated wage increases would have to be honored.

   "For those non-union employees," said Hein, "it would be wise if you set an expectation of what you would want to see there.

   "We can limit (budgets) on the front end, and if we find we have some extra funds, look for ways to put it toward something we really need to do."

   "I'm OK asking for a 0 percent increase on budgets, knowing that there are some who can't make that happen," voiced Supervisor Joe Oswald. "It's a starting point."

   Hein asked the board for those thoughts on non-union wage proposals, which include all county employees except Secondary Roads, Sheriff's deputies, Dispatch, and jailers.

   The board felt they needed some time to think about it.

   Supervisor Jeff Swisher asked about how the Compensation Board, which proposes wage increases for elected officials, was going to be brough up to speed on this matter.

   Hein said the code does not mandate that the Comp Board look at taxable valuations when suggesting wage increases.

   "Their job is to look at comparables," she said, "and set wages based on comparables."

   Hein told the supervisors that they have the information they need to decide how to proceed once they have the Comp Board's recommendation in hand.

   "If they (the Comp Board) knew we were under some restraints, I would think that would help," Oswald said.

   Hein said in order for them to "understand the full picture," it could take hours of research and homework before they could even begin meeting with elected officials. She said she has not heard from the Comp Board on when they plan to meet with their respective elected officials.