Monday, July 30, 2012

Council President Argues Monroe County Fiscally Sound

From the Bloomington Herald-Times:

Monroe County Council President Geoff McKim didn’t go as far as calling the county’s 2013 fiscal picture “rosy,” but his preliminary projection shows next year ending with fat reserves and a relatively skinny budget deficit, even without cuts.

Hearings for Monroe County government’s 2013 budget don’t start until mid-September, but county council members have already started crunching numbers in order to give department heads and elected officials guidance as they prepare their financial proposals.

After a published report on the city of Bloomington’s budget hearings, which concluded Thursday night, McKim decided to compare city and county budget projections for the year.
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In his analysis, McKim presents city and county finances side-by-side, using the city’s method of representing budgetary reserves: the projected cash balance in the General Funds at the end of 2013 plus the Rainy Day Funds. For Bloomington, that amount is $7,160,873, and for the county, McKim projects reserves of $16,854,488.

In 2013, Bloomington will spend $781,157 of its reserves, while Monroe County will end up spending $713,546 from its reserves, McKim forecasts.

“Of course, there are a lot of what-ifs in this analysis,” he said. McKim factored a 2 percent cost of living increase for county employees into his analysis, a factor that hasn’t been decided yet.  Otherwise, he uses a flat budget based on the first six months of 2012. He factored out one-time budget impacts, such as a correction to county option income tax revenues earlier this year. He factored in a state-set 2.8 percent increase in property tax collections, but flat income tax and miscellaneous revenues.

He also assumed a 3 percent decrease in county contributions to its health insurance reserves, which are already comfortably high, he said, “unless three county employees need organ transplants.”

The state has required a 1.5 percent increase in contributions to the Public Employee Retirement Fund, which his numbers reflect. He also assumed $150,000 in additional appropriations in 2013.
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“The upshot is that even under a projected deficit scenario, Monroe County government, through years of prudent fiscal management, clearly has reserves that are very healthy, compared to the proposed level of deficit spending during these difficult economic times. This is exactly why we build up reserves during good times — so we don’t have to slash basic public services when times are tighter.”

http://www.heraldtimesonline.com/stories/2012/07/29/news.mckim-county-coffers-look-to-be-healthy-through-2013.sto