County Response to Governor's Proposed Budget Repair Bill

February 07, 2002
Topf Wells, 266-9069 or Sharyn Wisniewski, 267-8823

County Response to Governor’s Proposed Budget Repair Bill By Kathleen M. Falk Dane County Executive February 7, 2002 Thank you for allowing me this opportunity to talk with you about the effects of the Governor’s proposed budget reform bill on Dane County and the steps we should take now and in the future to deal with these possible effects. In contrast to the State of Wisconsin, Dane County enjoys excellent fiscal health, as attested to by our AAA bond rating, the highest possible, enjoyed by only two counties. Our budget is balanced this year and in excellent shape. The only threat we face this year is the Governor’s proposal to immediately cut $5.74 million in promised, committed revenue. There are many reasons for this health including a strong, diversified local economy. Another big reason is that we have worked together on key budgetary decisions. In my years in office, I have set a tough levy limit, tougher even than the one proposed by the Governor in his budget repair bill. With your hard work, we hit the target each year. Over the last five years, we have steadily increased the County’s Reserve Fund -- again, in sharp contrast to the state. We have worked through some difficult cuts and restraints on county spending in order to fund the most important public services. This year, for example, our budget contains $3.6 million in cuts, which helped us build up our reserve and limit property tax increases. As we face the possibility of unprecedented and immediate cuts in promised shared revenue, we shall need this cooperation more than ever. I pledge my best efforts to work with you to preserve and improve vital services to our citizens while controlling costs and property taxes. We all recognize that the Governor’s recommendations face a great deal of scrutiny and -- hopefully -- some degree of change before they become law. As the Legislature becomes better informed about the consequences of the Governor’s proposal to immediately eliminate shared revenue for hundreds of Wisconsin local and county governments, including Dane County, it is more likely that there will be substantial amendments or alternative proposals adopted. Mickey Beil will lead our lobbying effort to work for budget amendments that are fair to our Dane County residents. Nonetheless, we cannot wait several months for the Legislature and Governor to act. With five million seven hundred and forty thousand dollars ($5,740,000) in unexpended state cuts staring us in the face mid-year ($5.5 million in shared revenue; $240,000 in the state’s contribution to debt service on the Exhibition Hall at the Alliant Energy Center), we must take measures to prepare the County to withstand the loss of funds. Tonight, I propose that Dane County adopt a careful, phased response to the state’s budget decisions. 1. In the first phase, starting tomorrow, I am directing a series of freezes and delays in spending that will better prepare the county to face drastic cuts if those occur later. These freezes and postponed spending do not create permanent cuts in programs or services but save money now. 2. I am also directing the Department of Administration (DOA) and other county staff to begin the analysis of other specific actions we can be prepared to take effect as soon as possible if the state adopts drastic cuts in shared revenue (or any other aids). Many of these will be some sort of reduction in a county program or service. 3. We will re-double our efforts to identify more efficiencies within county government and other local government partners. Even when we take all these steps, all of us must be absolutely clear on the following point. If Dane County has to take an immediate $5.74 million cut from the state this year, every program and every project, short-term or long-term, is on the table, subject to reductions. The following are specific actions that I have directed in each category. Freezes or Delays A. I am notifying the County Treasurer that I will take a 5% reduction in salary and will not take any scheduled raises this year. I will cut the salaries of staff in my office (Chief of Staff and Executive Assistants) by 3%. During a year when many county staff will have to work harder than ever, and when possibly greater sacrifices might be necessary, it is part of my job to be the first to take a cut. B. Effective immediately, there is a countywide hiring freeze. This freeze includes LTE positions. The freeze includes all county departments and programs. For all of the freezes or delays I announce today, DOA will administer an appeals process with exceptions to be made to protect public health and safety and, with some restrictions, for those departments or programs which operate independently of the levy. C. Currently, operating capital expenditures cannot occur until April 1st; that starting date will be delayed to June 1st. D. I am delaying all County borrowing, including roads, the conservation fund, and the Courthouse. This step does not stop planning for the Courthouse and other long-term projects. In addition, I have directed DOA to begin a review of all capital projects to determine which can be delayed until next year or which should be reconsidered by the Board and myself. E. Included in this year’s budget is a major step in upgrading the County’s system of personal computers. I am delaying these purchases. I have also directed DOA to pare this list down. F. While the County has signed many Purchase of Service (POS) contracts, there are a few major contracts that have not been signed. I am delaying signing these until March 15th. If it appears that drastic state cuts are forthcoming, it may be more efficient to renegotiate the contracts, rather than sign, revoke, and then renegotiate them. G. I have directed DOA to accelerate studies to save money through internal consolidation. Currently, DOA is analyzing consolidation options of Public Works and Facilities Management. In addition, DOA and Human Services have begun work on consolidating some administrative functions. H. I respectfully ask that the Board take up the pending ordinance amendment that would require county managers and elected officials to pay some fee for parking in the City-County Building, Public Safety Building, and, prospectively, the new Courthouse. I. I am freezing the Appeal Fund for conferences and travel. In addition, I am freezing two training accounts in the Division of Employee Relations. J. I have directed DOA to begin reviewing programs that we administer as agents of the state or federal government to determine if we are entitled to any additional administrative reimbursement. K. With the potential loss of the $240,000 annual payment provided by the State through 2014 and relied upon by the County to pay for the bonds issued for the construction of the Exhibition Hall at the Alliant Energy Center, I have directed Bill DiCarlo to begin marketing the sale of naming rights for the Exhibition Hall. Of course, I hope that all of these freezes or delays are temporary. However, if the freezes were implemented throughout the remainder of the year, the savings would amount to approximately $1.8 million. Additional Preparation A. I have directed DOA to begin researching different options for requesting, or, should the need arise, directing county managers to take unpaid leave or reduced appointments. I have asked DOA to structure the program, it if is legally possible to do so, so that affected employees would retain key benefits, such as health insurance. I have also instructed Employee Relations and the county’s collective bargainer to begin negotiating Memoranda of Understanding with our unions to make such programs possible for our represented employees. I recognize that these programs would create real hardships for our employees but alternatives might include even greater hardships in the form of full layoffs. B. DOA is currently coordinating a thorough survey of county government to distinguish between legally-mandated programs and services and those which are permissive. This information will be crucial if we have to cut programs and services. I have asked that DOA expand this inquiry to include a delineation of mandatory and permissive functions in the Court system and every other system funded by county funds and directed by independently elected officials. C. The Department of Human Services will now review any mid-year revenue or grant increases to determine whether those increases should be directed to a Purchase of Service provider or to reimburse the County for specific services. D. I respectfully request that the Sheriff notify the Department of Corrections that he will cap the number of Probation & Parole holds in the Dane County Jail at 100 by March 15th and that the County Board join with me in offering him every legal and political assistance in this position. In addition to these steps, the County already has a number of efforts underway to meet the long-term fiscal challenges of a growing population. These range from the comprehensive work undertaken by the Long Term Financial Planning Committee to specific efforts such as the Department of Human Services’ work to determine if “means testing” is a fair, appropriate, and significant support for different human services. Additional Cooperation With Other Local Governments I call on the City of Madison to work with us to complete the unification of our health departments. It will save some money in management costs, improve services, and given the attention it has received, become a symbol of local governments’ willingness to push through traditional concerns and barriers and work together. I will also propose to the Mayor that we consolidate, as soon as possible, at least one more service performed by both the County and City to generate some savings and some improved customer service. I am interested, for example, in looking at some key personnel functions. For instance, why should someone seeking a clerical position file two different applications with the City and County and take two word processing tests? I will also ask all the Mayors, Village Presidents, and Town Chairs of Dane County for their suggestions on working with us to save money and improve services. I look forward to their ideas. I started my first term as County Executive with the decision to work with the Town of Middleton to co-locate our western precinct office at the Town Hall and since then we have steadily expanded our cooperation with local governments. Now that work takes on greater urgency. We should be able to identify some good opportunities for savings throughout the County. Although I hope not, I fully expect there will be a Round 2 of cuts and reductions. In fairness, I must remind you that, at that point, every county service or project will be on the table. I will not take any action at that point until I have reviewed as many good ideas as possible. I ask for, and I welcome, your suggestions. I am meeting with our department heads and have scheduled two listening sessions for our employees to make their suggestions. Our staff will also have the opportunity to express their ideas by phone or email and in ways that they can preserve their anonymity if they wish. Finally, if the cuts in state revenue prove to be severe, I will schedule public meetings to get our citizens’ ideas and suggested priorities. Depending on the Legislature’s decisions over the next three months, we could face our toughest challenges to the excellent services and fiscal responsibility we deliver to our citizens. We will succeed for them only if we work together, even better than we have before. That’s what they elect us and pay us to do. You have my promise that I will work with you as hard as possible on their behalf. Attached is a summary sheet of the County Executive’s actions. Expenditure Categories Freeze Savings1 Delayed Purchases2 Additional Revenue and Efficiency Gains3 TOTAL Executive Office Pay Adjustments $21,000 Hiring Freeze $1,490,000 LTE Freeze $200,000 Conferences and Training Appeal $35,000 ER Training Accounts $45,000 Operating Capital Delay $820,000 Computer Upgrade Delay $200,000 Borrowing Delay CCB and PSB Parking Fees $35,000 Public Works Consolidation $100,000 Administrative Reimbursement $25,000 TOTAL $1,791,000 $1,020,000 $160,000 $2,971,000 1 The Freeze savings estimates assume expenditures in these categories are frozen for the remainder of 2002. 2 Delayed purchases will be reviewed later in the year when more information is available on the State Budget's impact on the County. Depending on the impact, these expenditures may be authorized at a later date. 3 The parking fee revenue is contingent on County Board approval. The Public Works consolidation savings is a preliminary estimate of potential efficiency gains. The administrative reimbursement estimate is based on a very preliminary analysis of a small number of programs.