BOC member asks about employee pay increases; others say ‘now is not the ...

“No, it’s not out of the question,” said Bond. “But find it, where we can get it?”

Escoe responded: “We’ve got the money.”

Madison County has money in the bank. Reserves for the county government at the end of 2011 have been projected around $5 million.

But the board is also projecting a major cash shortfall in its operating budget for 2012, since digest numbers will be down, meaning the county government will bring in less money next year unless the BOC raises this year’s tax rate, a move those at the board table say they are committed to avoiding.

Commissioner Stanley Thomas said the BOC is already essentially awarding a raise to county workers by absorbing increased costs for health insurance for employees, who receive 100 percent insurance coverage. The Madison County government’s total insurance cost for employees in 2011 is $703,082. That is expected to go up to $754,453 in 2012. If the county budget is approved at $14 million — which is roughly this year’s figure — then the health insurance costs will account for approximately five percent of the county budget.

Commissioner Mike Youngblood said now is not the time for employee raises.

“I know they need a raise,” said Youngblood. “There’s no doubt about it. But I don’t think you should base that raise off of money that we cut back and saved. I think that raise needs to be based off the economy picking up.”

Thomas said raises represent an increased cost for years to come.

“When you get into raises, it’s not like you give a raise and then it goes away next year,” said Thomas. “It’s an ongoing thing.”

Thomas said the county’s reserves should not be used to fund pay increases. He said the county needs those reserves during an economically uncertain time.

“Once you get into those reserves, if you don’t have something replenishing that money, you’re going to be right back where you were in 2004, when you were borrowing money to keep the doors open,” said Thomas.

Even though reserve funds won’t likely be used to fund employee raises, the county will need to dip into its rainy day funds to cover some expenses in 2012.

The BOC could handle a cash shortfall by slashing the budget, but commissioners say they’ve squeezed every drop of blood out of the turnip over the past several years of budget cutting.

“There’s not a whole of areas we can cut because we’ve cut so much in years in a row, you get to a point where you can’t cut,” said Thomas.

And neither Thomas nor any of the other commissioners express any interest in the other alternative: raising the millage rate on property taxpayers.

So, the board appears set to dip into its cash reserves in 2012 to offset at least some of its cash shortfall. The question remains: how much will they need to pull from an estimated year-end reserve balance of $5 million?

BOC chairman Anthony Dove tried to establish a clear figure for board members last week. With an estimated budget shortfall of $700,000 at the beginning of the discussion, Dove asked financial director Kathy Clark to eliminate all budget increase requests, such the sheriff’s department’s request for a new investigator position. He also asked Clark to eliminate all capital outlay requests, such as for patrol cars and an ambulance chassie. And he asked her to reduce the contingency funds — or built-in emergency money — in the budget from $200,000 to $100,000. That left the projected revenue shortfall at $358,000. Of course, the county has $325,000 in contingency funds for this year — none of which has been used yet. So, if all departments finish this year without going over budget, then this year’s contingencies could be used to offset next year’s shortfall.

“I think we’ve got our number,” said Dove of the $358,000.

The chairman said the BOC should count on an estimated $358,000 being pulled from cash reserves for 2012. Anything above that number in the 2012 budget — any extra positions, any pay raises, any vehicle purchases, etc. — would have to be added to the $358,000 figure out of the county’s reserves. Any additional cuts would lessen that figure, reducing the amount of money that will be pulled from reserves.

Still, Dove said there’s plenty of time for the BOC to mull the matter.

“We’re way ahead of schedule,” said Dove of the budget planning. “A lot of other counties are going to have it a lot worse.”