LEE COUNTY – What was planned as a brief budget update Monday turned into a debate about what the county’s budget director called, “the budget from hell”.
The Lee County Board of Supervisors talked in depth about possible levy rates for the upcoming fiscal year beginning July 1 during a workshop following an added Board of Supervisors' meeting Monday morning.
The board typically doesn’t meet on the fifth Monday of the month but had a closed session for union contract negotiations and then a full slate of agenda items.
Right now, the county is looking at a levy in the $6 to $6.50/$1,000 of assessed valuation range to meet expenditures, including a 3.5% increase in payroll for the 2023-24 fiscal year. That would be a substantial increase of almost $3/$1,000 compared to the current fiscal year.
Part of that is due to compensating for a potential 103% cap on property tax evaluations that is being considered by Iowa legislators during the current session.
The county is also putting an EMS levy in front of voters on March 7, that will add .75/$1,000 to tax rolls to help offset deficit spending in the ambulance department.
Budget Director Cindy Renstrom, who classified the budget process as “the budget from hell”, said the county could institute a lower tax rate overall if the EMS levy is passed.
“Well, I think that’s the message we need get out there,” said Supervisor Chairman Garry Seyb.
Seyb tamped down the urgency of the conversation saying he didn’t want the county overreacting.
“We do have the ability this year if we need to to use ARPA funding as an emergency stopgap,” he said.
“We also have a very large settlement that could be here by June from opioid money with new settlements,” he said.
The county is close to receiving documentation to allow settlement payments from Allergen, Teva, Walgreens, CVS, and Wal-Mart pharmacy companies.
The county has already allocated $230,000 in opioid settlement funds to help with funding shortfalls in the ambulance department incurred when nine additional staff were put on to help with the Hospital/ER closure in Keokuk.
Supervisor Matt Pflug brought up the possibility of a “wage freeze”.
“We’ve gotta be realistic here,” Pflug said. “You never like to have that conversation.”
Seyb said a wage freeze going into fiscal year 2024 does nothing to help this year’s budget woes.
“And I’ve said before and I’ll keep saying it, 'Our people are our best resource'.”
Renstrom said the county is projected to have a fund balance of approximately $2.7 million on June 30, 2024, including the proposed pay raises.
County Auditor Denise Fraise said she was more concerned about getting through this fiscal year which ends on June 30, 2023.
“Do we have enough money to pay our bills through the end of this year?” Fraise asked Renstrom.
“I don’t know,” Renstrom said.
New settlement papers for the five pharmaceutical companies are expected to be in front of supervisors in February, but no official timeline has been released for the payments to the county from those settlements.
The county is also looking at a 10% increase in health insurance costs for employees, which could add another $300,000 to the budget. Renstrom said those figures aren’t included in the updated budget figures.
Renstrom said the county currently has about $1.2 million in the general with five months left in the current fiscal year.
“That is not good,” she said.
Schulz suggested that the county may have to use ARPA funds to help balance the budget through the end of the fiscal year. The county has about $3.8 million left in that account, but the remainder has been committed to the construction of the new Lee County Health Department.
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