Travis County Commissioners Court
August 11, 2009,
Item 27
Number 27.
presentation and discussion of the fiscal year 2010 preliminary budget.
>> good morning, judge, Commissioners.
we're pleased to present the preliminary budget to you.
for fiscal 2010.
it is a balanced budget.
legal analysis will give you some details on how we got balanced and then we will talk about specifics, we will go through it very briefly.
we do want to stress that it is a balanced budget.
also thank the departments for their efforts this year with working with us.
it's -- it's -- they -- as I have said before, all have been very cooperative.
and we'll talk a little bit more about that as we get into the presentation.
i want to turn it over to leroy, talk about the specifics of the budget and he will come back and answer the questions that we have.
>> as rodney indicated, it is a balanced budget.
what we mean by that is that we have matched ongoing expenditures with ong revenue.
and one-time expenditures with one-time revenue.
you will see as I go through some of the highlights on the budget that in order to budget the balance we had to do shifting of some of these expenditures that had previously been ongoing to one time.
so if those departments are put on notice for the fy 11 budget, that they will need to bring the certified revenue and a lot of these positions up to the level that they -- that the expenditures were approved.
we did file the -- the preliminary budget on July the 27th.
with the county clerk, the county auditor, the members of the court.
we also posted it on the Travis County website on -- on July the 27th.
for the public to observe.
we do have a copy in the planning and budget office.
there were a number of challenges that we had in 2010, you are other revenue which included our investment income.
and all of the other revenue line items with the exception of current property tax and beginning fund balance, was actually down 9.4 million from 2010.
from -- from '09, fy '09.
the total 2010 budget is about 900,000 less than the -- than the '09 budget.
kind of a whole to work out with the -- with the guidance, approval, budget guidelines, the departments did submit, all departments submitted five percent cuts with the implications for those cuts and we essentially went into this budget with the guideline that the -- that the -- we would bring the preliminary budget in within three percent of the effective tax rate, which we did.
some of the items in the preliminary budget just -- just to hit on some of the large items, we had maintained unallocated reserves at 11 percent.
that's a total of about 43.5 million.
we have allocated reserves at 3.9.
we -- we did establish a million dollar fuel and utility reserve and as you can see, when we filed the preliminary budget, it looks like we may or may not need that reserve, but in the last two weeks, there's been a surge in gasoline prices and uncertainty.
we thought it would be prudent to put a million dollar reserve there.
we do have an economic downturn reserve that we placed in the 2010 budget of about $4.9 million.
in the event that the -- the recession continues longer than what we had anticipated.
and -- and it will help us address the 2011, which we have said multiple times is probably going to be more challenging than 2010.
we have put a $500,000 reserve in for future grant requirements.
as you are aware, we -- we approved grants that -- that have multi-year lives and we do have county contributions and we have estimated that for 2010 we could need an additional 5$00,000.
so we put that in -- $500,000, so we put that in as a reserve, one of the large things that we have is our retirement.
to keep the benefits level for all of our retirees, we -- we were required to -- for 2010 to put a $1.6 million reserve in, which would allocate to the departments for their -- for their retirement contributions.
chris broussard in p.b.o.
and myself attended the annual tcvrs, the retirement conference last week.
the losses that all of the pension funds have sustained because of the equity market reductions will be amortized over 10 years.
this 1.5 million is actually a one-tenth.
for the next 10 years it's anticipated we will need an additional 1.5 million per year, unless the market miraculously recovers back to previous highs.
other areas, we funded 1.7 million of maintenance occurring effort requests just as a comparison in '09 we had 3.8 million.
some of the big ones, its maintenance agreements, about $450,000 increase, travis central appraisal district was about $140,000 increase.
we had some pharmaceutical costs over in juvenile court of about 217,000.
and we had the hhs family support services that -- that, you know, you adjusted the eligibility requirements and that cost about 320,000.
we did have a number of revenue related packages that they totaled about half a million.
that included funding in the d.a.'s office, constable 1, 2, 5.
we do have one time, as I mentioned when we went into this, we have balanced it between one time and ongoing.
we have had a number of pilot programs for -- for up to three years that we have been funding on one-time money and the reason we fund them on one-time money is specifically that we did -- could not find sufficient ongoing funds to -- to fund them.
the largest of those are in hhs and I think that you all are aware of some of nose programs that we continue to fund on one-time funds.
we do have the jp collections and their facts support employees on one-time funding.
as you are aware the facts implementation in the j.p.'s is scheduled for 2010, as such this support staff to clean up the records will be going away in 2011.
those are one-time funding.
other than the pilot programs, they total about 1.9 million.
we did have any number of programs that their revenue has not -- has not materialized at the same amounts that -- that the expenditures were justified.
probably the largest of these was the e.m.s.
business plan.
as you are aware, that revenue is substantially down this year and our -- our intent was to allow the e.m.s.
staff to -- to bring that revenue, that business plan up to the -- to the generating the level of revenue that they -- that they had justified the additional expenditures.
we had some other expenses, as you are aware of, building 12 at del valle.
it's scheduled to -- to open September October -- I guess October 15th is the current time table.
and there was some staffing, 648, $649,000 worth of staffing to open that building.
rodney will -- will talk about some of the reductions that we have.
as we said, all departments in Travis County turned in 5% reductions.
and as you are aware, the adp, for the sheriff's department, the inmates, was below what we had budgeted for '09, so we did take the reduction there.
i'll let rodney talk about those reductions.
but let me talk just briefly about the tax rate.
our adopted tax rate for fy '09 was 4122.
the preliminary budget is balanced at 3% above the effective tax rate for fy '10, which is 4254.
the roll back rate which is 8% above the effective tax rate is 4377, and for your reference, one cent on the tax rate raises about $9.2 million.
the tax on the average homestead, and this is after all exemptions, in other words, this includes the 20% homestead exemption that Travis County gives to all homesteads, it includes the 68 -- I think --
>> 65.
>> $65,000 for individuals that are 65 or older.
it includes all of the veterans exemptions that are provided by statute and once you take all ofs those exemptions and you apply the new tax rate to it, you will have an increase on the average homestead and that is on the -- on the average homestead of -- let me give you 284,000, which is the latest number that we have from the appraisal district.
of $47.16.
so with that, I think that I will turn it over to rodney.
>> as we have talked about, when we went into this fiscal '10 budget process.
we had three priorities.
to minimize the service level impact on our citizens, seek efficiencies in our current programs and then protect our employees through the avoidance of layoffs.
we have been successful in accomplishing I believe all three of those goals with this preliminary budget.
we have taken about $4.6 million in the reduction packages that were submitted by the departments.
the biggest bulk of that is in the sheriff's office at less than 2.3 million.
the sheriff has been extremely cooperative with working with us, a lot of the reductions were a result of the adp, but he also worked with us on some other reductions as well.
one of the things that I do want to point out as we have gone through the -- through the preliminary budget process, one of the -- one of the issues that has come up since the preliminary budget was filed and we have been monitoring this on a regular basis and will continue to report back to the court is the adp.
for those of you tracking the a.p.d., we have seen a fairly significant increase in the numbers over the last few weeks especially.
and as compared to what it was, say, even a month ago.
as a result, we may be coming to you through -- during the markup process to make some recommendations on -- on potentially funding additional staff, but we're going to continue to monitor it.
we will report back.
if we see that -- that the job is an issue that needs to be addressed, we will certainly bring that to your attention.
beyond that, I think that it is a fairly -- a fairly sound budget.
i think that it is a budget that is -- as I said -- addresses maintenance
>> [indiscernible] issues for existing programs, minimum minkes the impacts on the -- minimizing the impacts on the citizens.
as leroy said the increase on the average homestead for the preliminary budget is $47.16.
and -- and that is at 3% above the effective tax rate.
i want to touch if I could on the reserve issue real quickly.
we purposely made an effort in this budget to build reserves that we could carry forward into the 2011 budget process.
the reason being is that we anticipate 2011, as we have said numerous times, to be even more challenging than 2010, I'm going to give you just a couple of examples of why we think that.
we currently have about $4.6 million in savings from the transfer that we made ma to the risk and -- we make to the risk and health insurance funds.
we did not anticipate going into 2010 that we would have the ability to not do those transfers again this year.
fortunately our risk and insurance funds are healthy enough that we were able to not make that transfer again, there be saving about -- thereby saving about 4.6 million.
we do not know that we will be able to do that in 2011.
we have not increased any insurance premiums in four years, I believe.
which is remarkable for our plan and so that is an issue that we do not know that we will have that savings going into 2011.
we also anticipate about a billion dollars in decreased new value that will come on the tax rolls in 2011.
a billion dollars translates to right around $4 million in available resources ongoing that we would have available to us going into 2011.
other revenue sources is another major concern for us.
again, other revenue sources are -- are those revenues outside of the property tax revenues.
and we have seen a significant decline in our other revenues.
as an example, from 2009 to the preliminary -- preliminary '10 budget, we had a difference of about nine million dollars in other revenue available to us.
we do not know whether that trend will continue.
but we are -- we are monitoring that very closely and meeting regularly with the auditor's office, to talk about revenues and some strategies as we go into 2011.
so those are just a few examples of the things that we have that could potentially be a challenge for us as we go into 2011.
therefore, what we have done for the 2010 budget is we have attempted to build in these reserves, the economic downturn reserve, if we don't need the fuel and utility reserve, those funds would be available to us.
then the -- then the -- the -- as I said, the economic downturn reserve of being out there.
we have got?
cushion, if you will, as we go into 2010 to help offset these potential loss revenues in 2011.
our goal i4e to minimize as best we can any-- any additional impact on the departments as we go into 2011.
i want to stress that as we go into the budget from the reserve perspective.
i want to talk just for a minute about key dates for the fy '10 budget adoption.
p.b.o.
will distribute on -- on August the 25th, to the Commissioners court, the agenda worksheets.
again, I just -- I just -- just to remind you the agenda worksheets will be a reflection of those reductions that have been taken, not the additions package, packages that have been submitted.
so we will focus our attention on the reductions and -- and provide those to you on the 25th.
as a frame of reference, we would like to have those back by 5:00 p.m.
on September 1.
on Wednesday, September 9th, and we have reserved Thursday, September 10th for markup.
i will also just let you know that we need to, if possible, land on a tax rate on the 9th and have that voted on, on the 9th, so that we can get that posted in the paper accordingly.
i think we are shooting to have that advertised on the 14th.
just as a frame of reference.
on the 22nd, we will hold our first public hearing on the tax rate.
the Friday the 25th, we are scheduled to have our second public hearing on the tax rate.
well -- with the public hearing on the budget and the final adoption of the budget and tax rate on -- on Tuesday, sent 29th.
september 29th.
those are key dates that we have facing us as we go forward.
for those that are interested, I just real quickly want for touch on -- to touch on some of the -- in the preliminary budget, out on the website, we do have hard copies available.
the preliminary budget from pages 6 through 21, will give you a very nice summary of any reductions and/or additions that have been taken by department and give you a brief explanation of what each of those are.
so if you are interested in looking at those.
i do also want to recognize the staff, they have done a fantastic job of working with their departments and putting this thing together.
leroy and all of them have been phenomenal given the challenges that we have faced.
i want to publicly thank them for their work and their efforts.
with that, we will open it up for any questions that you might have.
>> > questions, court members?
mr.
reeferseed?
>> reeferseed here.
thank you, sir, I just have one little silly question.
do the cushions of extra funds roll over to next year if unused?
>> yes.
>> okay.
great.
>> could you basically tell the public the -- the ratings that -- that Travis County has received from a major -- from our major creditors davenport, moody.
>> yeah.
both moody's and standard and poors have a triple a bond rating for Travis County.
we are one of only four counties that have triple a bond ratings from both moody's and standards and poors.
>> tell the public what that actually means.
>> it means when you take your bonds to market that you, number 1, get people that are willing to buy them and number 2, you get a reduced interest rate, willing to buy your bonds at a lower interest rate which saves all of the taxpayers' money.
>> it's like a credit bureau for the person that really -- as a consumer out there when you apply for credit and things like that, you know, you get an interrate according to -- interest rate according to your credit, so this is something similar to Travis County operates under is -- is that type of -- of scrutiny.
so I think the public really needs to understand that Travis County is doing a good job, I think, with -- with care taking and being good stewards of financial responsibility to the citizens of Travis County.
>> pardon me.
one question, is that for the whole state of Texas or for -- out of the entire state of Texas.
>> 254 counties.
>> thanks.
>> all right.
sorry, I thought that you might have some company there, mr.
reeferseed.
>> do we think that interest earning will improve during the next fiscal year or we really don't know?
>> everything that we are looking at, judge, doesn't look like it.
the one thing that I would like to add, I think that they have done a really nice job with the preliminary budget, I wholeheartedly support those reserves.
>> [one moment please for change in captioners] analysis to guide us to the estimate that we can, but it is still an estimate.
and we don't know what's going to happen between when you adopt that budget and when the taxes actually come in.
so I think it is very wise to have those reserves.
we don't see interest coming up very much, if any at all.
so that's one of the issues.
another thing I think I need to mention is you have really mentioned this budget over years to put us in the position that we're in.
and many, many governments are in absolute disaster and crisis.
and this government isn't.
and it's not an accident.
it isn't that we got more money than anyone else.
it really is the management of the Commissioners court and the elected and appointed officials in the county.
as others have --
>> as the auditor and on good executives in planning and budget office, thank you.
>> the other thing that is important to note is that as other governments have gone right to the roll back, which is eight percent, and this government has not done that.
you're not proposing to do it this year and you haven't done it for a long, long time.
so I'm not sure that's so clear to the public, but we have enormous programs that we cannot control the demand for and you've really done, from where I sit on the financial end, a really good job of managing that.
and we didn't get to this point by accident.
so I think you deserve that kind of credit.
>> are we trying to figure out why the average daily population is going up earlier than usual, where we normally have a spike in late August, September anyway, right?
>> yes, sir.
the spike appears to be a little bit more dramatic this year than it has been in the past.
and we are looking at that.
we've been working with justice and public safety.
we we do have some meetings scheduled in the upcoming weeks with the sheriff's office.
and all of the collective bodies are getting together to work on exactly what is driving that.
and so there are some select populations that we've noticed increases in.
in that are kind of puzzling us a little bit, to be quite honest with you, but we are looking at it and trying to get our finger on it.
so I -- we're going to continue to monitor it.
i don't want to jump out there right now and say we need to do from a personnel perspective, but we will monitor.
and as we get further into it.
>> let us know.
so we have two days set aside for budget markup.
>> yes, sir.
>> do we think we have budget markup issues?
>> at this point the only issue that we have received that would require court attention that I'm aware of is the juvenile discussion that we'll have on Thursday.
we have again not gotten confirmation back from the state regarding the funding issues that we face, but they will discuss that on Thursday.
as I mentioned before, all of the departments have been very good to work with us.
they've been very good to understand the situation that we're facing and we have not received any other requests at this point for items that appear to be needing to be addressed during markup.
that's why, judge, we have received that 10th, but we're hopeful that on the ninth we can get everything resolved.
>> it seems that the department should not be optimistic about any kinds of increases?
ms.
fleming.
>> I'm sherri fleming, executive manager for health and human services.
and I do want to commend planning and budget for their approach to the budget this year.
they have been responsive to what we are seeing as unprecedented demand in the health and human services area.
so planning and budget has been as responsive as they can be to our issues as it relates to spending and being able to be responsive to our constituents.
but I would add that this is another area where we don't know what we don't know.
and so while we are being as judicious as we possibly can, we certainly would have you be aware that this is an area where we continue to see unprecedented demand and that you are aware that many of your programs provide one-time assistance.
so we are seeing folks who are not primarily our primary customers, that we're seeing new folks come in on a daily basis, and that has great impact to our spending in that area.
but I do thank pbo for the responsiveness and particularly my budget annualist, travis gatlin, who gets a lot of grief from me.
so I appreciate their responsiveness in this budget.
thanks.
>> the efficiency committee has been kind of quiet.
does that mean they've been working real hard and will surprise us at some point?
>> we actually had broken up into subcommittees, and there has been some work behind the scenes.
i have had a meeting with the sheriff's office and some potential vendors that wanted to provide an opportunity to look at some of their products.
and so from a fuel and fleet related issue, which joe gieselman and myself work on, we are going to take a look at some of those initiatives.
and I will tell you that I don't know if the court receives the monthly fuel usage charges that are distributed by fleet, but it does appear that the fuel usage is leveling off, so we're not seeing an increase, which is good, which was our target to keep a basically steady state in terms of consumption.
and it does appear to be working.
and so we are very pleased with that.
>> we're posted for presentation and discussion.
any more discussion?
>> I just have one more.
>> we're not postd for action.
>> one more question, judge.
when we had the appraisal district person before us, mr.
brown, it was one thing that he brought up, and I guess we've been kind of hearing about it, and that is the appeals, the significant increases as far as the persons appealing their appraisal on their property.
i guess when would be final portion of that appeal process be resolved under the appraisal district as far as rulings are concerned where we may have a clear picture as far as the -- that process has been exhausted, and we really do at some point realize the revenue that will end up -- the loss revenue that we won't receive.
do we have a thumb on that pulse?
as far as their movement as we go through this process?
and I guess the question is to when.
>> the latter part of August the chief appraiser hopes to have the number of protests resolved in order for him to statutorily certify the roll.
as you know, he did a certification, but there was still outstanding too many dollars of protest.
>> right.
>> in his net taxable value of $97.6 billion, he has factored in the number, an allowance for those he believes the taxes will be reduced.
so that's the number 97.6.
and he believes that when he certifies the latter part of August that that will be the number that he certifies.
now, in answer to how long will these appeals go on, the remaining $12 billion' worth of appeals will go on through the fall.
now, he will-- some of them end up in district court and go for years.
i'm not sure exactly when all of the appeals will be resolved.
i do know before he can certify the tax roll that he must have it within 10% on the protest.
>> okay.
and that's basically what I was trying to get a date locked down.
and I know that we have discussed it earlier, but I knew we had to go back and kind of do some recertification, but I didn't know exactly the final date of the outcome for that.
and you gave it to me.
>> just so you know, we're watching that very closely.
and the reason for that is because there are certain, what I call, gates that have to be hit as we go through the adoption process.
in order to satisfy the budget adoption, the legal requirements for the budget adoption.
so what we are doing is we're monitoring that very closely so that if we see we've got some concerns in terms of the dates in order for us to hit those gates that I mentioned, we can look at our calendar and try to make the necessary adjustments.
but I think we'll be okay.
>> okay.
thank you.
>> thank you very much.
>> thank y'all.
The Closed Caption log for this Commissioners Court agenda item is provided by Travis County Internet Services. Since this file is derived from the Closed Captions created during live cablecasts, there are occasional spelling and grammatical errors. This Closed Caption log is not an official record the Commissioners Court Meeting and cannot be relied on for official purposes. For official records please contact the County Clerk at (512) 854-4722.
Last Modified:
Friday, August 7, 2009 3:07 PM
