County talks budget, levy increases
WORTHINGTON -- After a two-hour discussion Tuesday afternoon on the 2012 budget and levy, Nobles County commissioners are slightly closer to setting a not-to-exceed levy by their Sept. 15 deadline.
Based on budget information received from each department, the county is looking at a requested levy of more than $10.5 million in 2012, and a levy increase of 7.3 percent. That compares to a $9.8 million levy in 2011, which amounted to a 2.51 percent levy increase.
Just as costs continue to rise in county government, revenues from state aid are on the decline. Nobles County Administrator Mel Ruppert reported a net loss of $332,000 in county program aid from the last five months of 2011 -- an amount equal to 3.4 percent of the levy. He estimates 2012 county program aid at potentially $500,000.
A couple of favorable aspects relating to revenue include the estimated $189,869 anticipated from the wind energy production tax credit, and the city of Worthington's decertification of a TIF (Tax Increment Financing) District that stretches from Wal-Mart to JBS.
Commissioners each offered their own opinions of what the not-to-exceed levy should be set at, with amounts ranging from a 5.9 percent increase to an 8 percent increase. Work will now continue to bring the commissioners into agreement and hammer out the details of the budget.
Among the biggest points of discussion Tuesday were the proposed 0 percent Cost of Living Adjustment (COLA) for county employees, the possibility of adding a $5,000 deductible option to the employee insurance plan, how to fund the $300,000 needed for the county's ARMER (Allied Radio Matrix for Emergency Response) system, and bonding for a new library and office building for the Southwestern Mental Health Center.
One of the items all commissioners agreed on was funding the ARMER system with county reserves. The county has more than $700,000 in reserves, according to Ruppert. He said it could take the $300,000 from reserves and still have enough in the fund balance to operate county government for up to three months.
As for bonding for both a library and offices for the mental health center, Ruppert was asked to look into the potential to bond for the Southwestern Mental Health Center's new offices. Commissioners David Benson and Marv Zylstra both expressed interest in bonding for -- and owning -- the building and then establishing a lease-to-purchase arrangement with SWMHC. The library project is still in discussion, and Ruppert said the county could consider bonding, an endowment or financial support from multiple funding partners.
All of the commissioners agreed on a 0 percent COLA increase for employees, and decided not to designate more than the $250,000 from County Program Aid toward the county road system. With the exception of 2011, commissioners had set aside 3 percent of the levy to fund improvements to county roads.
"Nobody likes their taxes raised, but nobody wants their goods and services reduced," said Zylstra of the need for a levy increase. He said he preferred a 5.9 percent levy increase for 2012, which would require more cuts to be made in the overall budget.
"I hate to say it, but I think long term you're going to want to be closer to 8 percent," responded Benson. He said there is still no guarantee the wind energy production tax credit will be paid to counties, and he is also concerned about future levy limits.
"I don't like to go much over 6 (percent)," said Commissioner Diane Thier of the levy limit. "I think we're going to need to cut more."
Commissioner Vern Leistico recommended a levy increase of 7.9 percent, while Bob Demuth Jr. was in favor of a 7.3 percent levy increase, which was equal to the levy increase noted at the start of the meeting.
Commissioners will discuss the budget and levy again at their regularly scheduled meeting on Sept. 6. If they cannot come to agreement at that meeting, they could set a special meeting for Sept. 13.