1997 Budget Good and Sensible
Posted 02-10-1997
Last month Westmoreland County passed its budget for 1997. It was the first budget I had
the opportunity to vote on and to have input into shaping. I believe it is a good,
sensible budget and though no one wants to EVER raise taxes, the one mill we restored to
the county millage was fiscally responsible. I say that because even though we budget one
year at a time, we forecast several years down the road. Our financial future will be much
tighter than in 1997. Restoring the one mill that was taken out for the last election will
help with future budgeting.
When the proposed budget passed it had a
nearly $3.5 million deficit. After detailed analysis we were able to cut nearly $1.5
million from the capital budget. We may have disappointed a number of departments by
turning down budget requests but I believe we acted responsibly. I was told by a number of
people that it was the first time in anyone's memory that the commissioners actually sat
down and went through the budget line by line and made cuts. To me, that is the only way
for us to truly have an impact on the budget. Also most importantly, we sent a message
that in the future the budget will be scrutinized and requests must be truly responsible
and conservative.
Along with cutting the $1.5 million we were
able to realize approximately $500,000 in year-end expenditure restraint from 1996. These
actions, along with $3.6 million in increased revenue for 1997 (including $3.2 million
from restoring the mill) will allow Westmoreland County to have a $2.1 million surplus
rather than the $3.5 million projected deficit.
There are a number of reasons the budget
grew from roughly $170 million to $195 million for 1997. Salaries and benefit costs
continue to rise along with goods, materials, and supplies. We also converted from a cash
basis of accounting to a more widely accepted accrual basis. Because of the conversion,
expenditures were budgeted for thirteen months rather than twelve. The item of greatest
concern however is the General Fund operating deficit. it will be reduced to $7.2 million
after our actions from a preliminary projection of $12.4 million. Reducing the operating
deficit is the real challenge we face in 1997 and the future.
There are a number of ideas we are
examining to reduce the operating deficit. We are looking at purchasing environmental
insurance coverage in lieu of self-insurance at the Waste-to-Energy Plant. The debt issued
for self-insurance could be transferred to the Workers' Compensation Trust and free up
$1.4 million in Trust assets. Through effective financial management of our previous
manager at Westmoreland Manor, we will not have to expend county funds as a match for
state and federal funding. This action should allow us to recognize $800,000 in savings
for 1997.
We also are looking at a staffing
reduction. An estimate of 25 employees would save approximately $400,000 per year. Part of
the problem with county government is there is virtually no turnover. With no retirement
age and longevity pay being such an attractive employee benefit, many employees choose to
stay longer than their private sector counterparts. I want to examine the concept of
longevity pay and see if we can take action to help future county governments deal with a
problem that is now costing taxpayers roughly $3 million per year.
In summary, I think our actions with this
budget were simply the beginning of a new philosophy of managing county government. The
days of huge fund balances that can be used to balance the budget are over. Conservative
spending, limited hiring of new employees, and stronger oversight of the programs under
the commissioners' control must be the guiding principles of our management from now on. |
