NTF NOTES ON DOUGLAS COUNTY STRATEGIC BUDGET

NTF worksheet: douglascounty138.doc. 9-15.
NEBRASKA TAXPAYERS FOR FREEDOM NOTES ON DOUGLAS COUNTY STRATEGIC BUDGET MEETING: SEPT. 24, 2015.

GENERAL. Douglas County Commissioners actively seek public input on budgeting, though most people do not understand county functions.

RELATIONS WITH STATE. The State continually imposes unfunded mandates on counties. County will ask the State to pay for increased costs stemming from LB 605, which requires counties to pay for additional space and equipment for probation officers and for housing additional inmates convicted of misdemeanors and accompanying additional staff.

PROGRESS IN MEETING OBJECTIVES. County objectives accomplished for controlling employee compensation, increasing ratios between supervisors and employees, reviewing department head salaries and union vs. non-union pay, and giving notice and education to employees regarding their pay and benefits. Employee recognition programs proved important and will continue. Dept. heads are working more cooperatively with county commissioners. Collaboration between Mental Health Center and Corrections Dept. Public-private partnerships established for juvenile justice reforms. Private contract given to take gas from the county landfill. Outsourcing worker compensation program gives county access to software that will cut costs. Regionalization established to lower costs, e.g., Emergency Management Agency and 911 services that share radio costs. Relationships with state senators improved. More sharing of technology and use of technology at lower costs. Technology refreshing saves money. County further resolves to accomplish the following:
* implement zero-based budgeting in each department
* control guardian ad litem expenses
* discontinue paying for retiree insurance with 1-yr. notice
* restrain inflationary employee compensation plans
* eliminate paid time off
* enhance employee wellness programs and policies
* establish a public health system partnership with UNMC and the Veterans Administration to coordinate care
* enhance county board practices
* develop a complete technology plan
* allow the public through social media to comment through surveys on issues and priorities
* consolidate city and county planning and attorney offices
* decrease pre-trial incarceration numbers
* consolidate juvenile justice services in one area.
* press the legislature to allow the county to institute reforms, such as for guardian ad litem issues, and to pay for now unfunded state mandates
* cooperate with other counties to lobby the legislature on common issues
* establish a monitoring process for all these above plans.

SETBACKS. The legislature passed LB 605, which will impose added costs on Douglas County. The state supreme court cut county treasurer commissions on collecting taxes, depleting $600,000. Still underfunded pension plans.

REQUIRING ATTENTION. Escalating jail costs. Additional space needed for probation officers, county offices, and possible 6th juvenile court judge. Deferred maintenance costs. Increased regulatory demands. Loss of institutional knowledge from older employees retiring. Major cost drivers are salaries and benefits.
Insurance costs. Higher employee insurance costs stem from Obama Care dictates. 7% health insurance cost hikes this year and rising 7-12% annually. County self-insures 5,000 employees, costing $30 million in 2014. Employees pay a $300 or $600 deductible, depending on union to which they belong. County seeks to move all employees into the $600 high-deductible plan, because Obama Care will tax the other plan in 2016. The Teamsters Union plan will become more costly in 2016. The county in 2014 paid out fewer claims at a lower amount for employees who have health savings accounts.

Pension costs. Ended Rule of 75, which allowed employees to retire early, if their age + years of service equaled 75. Now, employees must work 10 years to receive a fully vested pension. The ratio between active employees and retirees is good. Investment return on pension funds is 7.5%, the average 12-yr. return is 7.3%. Employees hired after 2011 have a lower pension pay formula, a maximum of 45% instead of 60% of average pay and 1.5% instead of 2% of average pay times years of service. The county ended cost of living increases (COLAs) in 2000, because they are prohibitively expensive. In 1995, the pension fund was 100% funded. Funding reached a low of 57.8% in 2010 because of the recession but now sets at 66.8% and rising, lowering the unfunded liability. By 2035, the county expects 89.3% funded. Removing the disability benefit from the pension plan will reduce the plan liability by $2.4 million and eliminate the disability insurance premium from the plan, which totaled $335,000 in 2014. Douglas County can fiscally handle its pension costs.

TAX SITUATION. The county has limited financial resources as the only urbanized county in Nebraska, relying mostly on property taxes. Douglas County receives only 12.8% of county property tax collections. Property valuations up 3.87% only because of commercial property increases. Tax increment financing delays payment of property taxes to the county. Need for state tax policy reform or change and elimination of loopholes.

NTF DISAGREES WITH THESE PROPOSALS.
* Establish a separate mental health court. Too many criminals conveniently blame mental health problems for their crimes.
* Raise awareness of health center services and secure additional private funding. This entity should not compete with private hospital and health center services.
* Hire a county information officer. A current employee could handle this duty.
* Fund tools to educate public on county government. This expense is unwarranted.

Research, analysis, and documentation for this worksheet done by NE Taxpayers for Freedom. This material copyrighted by NTF, with prior permission granted for its use by other groups in the NE Conservative Coalition Network. 9-15 C

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