In other action Monday morning, the Barton County Commission:
• Adopted the 2016 authorized positions listing. As adopted by the commission, the 2016 budget contains costs associated with personnel for county departments. To assure that offices are operating with appropriate personnel, the 2016 listing includes all County positions, including Central Kansas Community Corrections and 20th Judicial District Juvenile Services, since both fall under the umbrella of county operations.
The total number of listings for 2015 were 181. This year, the number is 182.
• Approved the capital improvement plan. Through the budgeting process, Barton County plans for cash transfers, as savings, to the plan. This plan, as revised each year, allows for the projected maintenance and remodeling of county buildings and major modifications to roads and bridges, Boeckman said.
• Approved the equipment replacement plan. Through the budgeting process, the county also sets money aside for this plan. This plan is also developed and revised annually for to ensure equipment costs are kept at a manageable level, Boeckman said.
• Approved Southwest Developmental Services Inc. as the Community Developmental Disability Organization for the county. Under the 2016 service agreement, SDSI will provide all services required by Kansas statutes for a CDDO for a total of $70,000, Boeckman said.
Southwest contracts with the State of Kansas as a CDDO for an 18-county area in southwest and central Kansas. It has offices in Garden City and Great Bend. SDSI has contracted with Barton County since July 2005.
SDSI does not provide services directly to individuals. It contracts with affiliated community providers and helps coordinate services.
It’s a lean budget for lean times.
Citing a $1 million loss in revenue and increased meddling by the Kansas Legislature, a split Barton County Commission Monday morning approved a 2016 operating budget calling for a six mill increase. This takes the county’s mill rate from 37.461 in 2015 to 43.461 and total expenditures from $19,553,150 to $19,734,411.
The county published a budget with the six mill hike to increase county revenues, but County Administrator Richard Boeckman told commissioners they could also opt for a five mill plan that would have included tapping reserves. The goal was to balance paying for county services while keeping spending as close to flat as possible.
When it came time to pass a budget, the vote was 3-2 for the six-mill budget. Voting for it were commissioners Don Davis, Chairman Kenny Schremmer and Jennifer Schartz, and opposed were Homer Kruckenberg and Alicia Straub.
“This budget year has been very trying for everyone,” Schremmer said. “We understand the needs of the county and we understand the burden of taxes on the people.”
Nobody likes tax increases, he said. But, “this county has to progress” and continue to provide the services residents expect.
“None of this is taken lightly,” Schartz said, adding the decision was one of the hardest she’s had to make as a commissioner. But, “we can’t cut our way out of this.”
The budget hearing
The action followed a public budget hearing during which Boeckman outlined the problems faced by the county and the commission’s options.
“The 2016 budget has been both frustrating and challenging,” Boeckman said. It has been frustrating because for the second year in a row delays caused by the County Treasure’s Office delayed the audit. The Commissioners did not receive the audit until Aug. 31.
In adopting the budget on Sept. 14, the commissioners were over a month late in adopting a budget compared to most years. Last year the budget was late due to similar reasons.
“The 2016 budget has been challenging because the county has a significant revenue loss for the second year in a row,” Boeckman said. The revenue loss for 2016 is more significant than in 2015.
The 2016 revenue loss is just over $1 million dollars. For the 2015 budget the revenue loss was approximately $410,000.
Commissioners were determined to hold expenditures as closely to 2015 levels as possible, he said. “In order to fund expenditures at that level, with very small expenditure increases for the 2016 budget, an increase in revenue the equivalent of 6 mills is required.”
A mill in 2015 is worth $270,067. A mill in 2016 will be worth $243,232, a difference of $26,836. This decline in the value of a mill is primarily attributable to oil and gas valuation decreases.
One mill equals $1 dollar of taxation for every $1,000 of property valuation, which is an educated estimate of real property values. This means that under the new budget, the taxes on a $100,000 home will increase by $69 to $2,054.31.
“The math is simple, Boeckman said. Multiply $26,836 by the 2015 mill levy 37.461 equals $1,005,303. This means just to fund the 2016 budget at 2015 levels the mill levy must increase by 4.13 mills.
There are two other factors that impact the 2016 budget.
First, the expenditures for 2016 will increase very slightly due to 2016 general election costs and increased banking costs totalling $132,120, the equivalent of .55 mill.
Second, sales and use tax revenues are down compared to 2015, and other sources of revenue have declined. Because of less revenue in 2015, there will be less cash carry forward for 2016. Another 1.32 mills are necessary to offset lost revenues and less cash carry forward to fund the budget at a 6 mill level.
“A shortfall of one million dollars is a considerable revenue loss for Barton County,” Boeckman said. The commissioners have considered a variety of options to address this shortfall.
They looked at reducing expenditures, using reserves, increasing revenues or some combination of all three, Boeckman said. In the end, commissioners determined county departments couldn’t absorb any more cuts without layoffs or reductions in service and keeping reserves on hand was important in case of major expenses and to keep the county debt free.
This left the tax increase on the table.
There is also the looming risk of state-imposed tax lid.
A tax lid was passed by the 2015 legislature. In short, the lid barred cities and counties from raising new revenue without a public vote, and then provided no meaningful way for an election to occur.
The legislation was initially to be effective in 2018 but was passed with an effective date of 2016, which means it would have impacted the present budget, Boeckman said. That legislation provided no ability whatsoever for cities and counties to prepare for the lid.
The legislature recognized the flaws and during the wrap-up session amended it to re-impose the 2018 date. This means that for the 2018 budget the commissioners must expect a tax lid.
“One can hope the legislature will revisit the tax lid issue but one cannot be sure, nor can one predict with any certainty what that future legislation will look like,” he said. “It could be less friendly to cities and counties that is the present legislation, which in my opinion is not friendly to cities and counties at all.”
“We’ve got to get on these people,” Straub said, noting legislators are elected every two years. “We know what do do with our money. They don’t know what to do with our money.”
A matter of revenue
“Ultimately, the 2016 budget problem is a revenue problem,” Boeckman said. A 6 mill increase provides no new revenues and maintains the status quo. Such an increase enables the county to provide existing services but no new or extended services, while protecting it from a tax lid should it come to pass.
“The commissioners have faced two extremely challenging budget years,” Boeckman said, in 2015 and again in 2016. “Revenues have declined but the citizens of the County still expect the County to provide quality services to the taxpayers.”
The 2016 budget continues providing services at the same level as the past several years.
“The commissioners see the County on a positive track,” he said. “They want to keep the county on that track without unduly burdening the taxpayers of the county with a tax increase any larger than necessary to offset significant revenue losses.”