Balancing act: $25M deficit to be righted by 2021 savings, potential building sale
Seats were plentiful, but county residents to occupy them were not, as the Lycoming County commissioners officially presented and discussed their 2022 budget.
Thursday night’s event at the Trade and Transit Center was an opportunity for the public to voice any concerns they might have with the proposed budget, which includes no increase for real estate taxes for the upcoming year with the proposed rate to remain at 6.5 mills.
It could have been the lack of tax increase that kept people away, it could have been the rainy weather that blew in that afternoon, or people may have stayed away because the event was in-person only, a departure from last year’s virtual presentation. Whatever the reason, former Commissioner Jack McKernan and the Sun-Gazette were the only members of the audience there with county employees and Commissioners Scott Metzger and Rick Mirabito. Commissioner Tony Mussare attended by telephone.
The proposed budget for next year totals $110.1 million in revenue for all operations and services, which is an increase of .08% over this year’s adopted budget of $110 million. Budget expenditures for 2022 are $134.7 million — is a 5% increase over the 2021 budget. The projected deficit is $24.6 million, which Brandy Clemons, county director of budget and finance, characterized as a “large overall deficit” for the county.
She clarified by adding that the county is expecting “quite a bit of savings this year (2021) with down staffing and not being able to complete capital projects, not being able to get certain items that we tried to order.”
“We expect to come in for the general fund about $15 million below where we budgeted to be, which will increase our fund balance quite a bit,” Clemons said.
“So, even with the large projected deficit for the general fund next year, we’ll still be left with a healthy, almost $15 million fund balance,” she added.
Fund balance refers to the amount of money an entity needs to have on hand for operating costs for a two-month period.
Capital projects account for the largest increase in expenditures for next year. The county has budgeted $4.8 million for a new building for the coroner, which will also house a district magistrate’s office, central processing and the bail release program.
McKernan questioned the commissioners if there were other funds that could be tapped for this particular project, such as grants.
Metzger noted that the district attorney’s office will contribute money for central processing and that the different entities to be housed in the building have funds they can tap to offset costs. Mirabito added that the county will no longer need to pay rent to house the district magistrate’s office once it is moved to the coroner’s building, which would be a cost savings.
Other projects included in the budget are $1.2 million for a build-out for a health center for county employees and their families and $2 million for a build-out and move from Executive Plaza to the Third Street Plaza. Revenue from the sale of Executive Plaza, once the move is completed, will offset the expense of the project, but revenue in next year’s budget does not reflect that.
“Once that’s programmed in or received, it’ll decrease the deficit even more, leaving us in an even better financial position going into 2023,” Clemons said.
Another $3.7 million is budgeted for bridge bundling projects. According to Metzger, 10 bridges are scheduled for work next year. The cost for this project is reimbursed by funds from the $5 fee that the county enacted on vehicle registrations several years ago.
Renovations to the sheriff’s office at a cost of $250,000 are also planned for next year.
The health center will serve as a primary care health center, which will do “as much as we find economically beneficial to do,” said Mirabito.
By doing the wellness center, the commissioners are hoping to drive down insurance costs to the county by encouraging employees to use the center instead of emergency rooms at local hospitals and other community health centers.
“The point of the health center renovations is to catch problems with employees early on and then hopefully also drive them to a more consumer-friendly use of their health services because, instead of making appointments and waiting, they’ll be able to go right from work,” Mirabito said.
One of the benefits of the health center is that employees will be able to see a health care professional at no charge and without scheduling an appointment.
“Although it’s a benefit to employees, it’s a benefit to taxpayers. Because ultimately, if we have healthier employees, you’re going to have a lower tax bill because we are self-funded,” Mirabito said.
“Being self-funded means that we pay for every health care claim,” he added.
Metzger stressed that the budget was still in the preliminary stages.
“We’re still looking at cuts. We’re still looking at ways to save money,” Metzger said. He noted that everything that’s put into a budget for many reasons doesn’t always get done.
“The county tax (rate) is 20 cents on the tax dollar. Depending on where you live, it’s going to be 21 to 24 cents from your municipality, then your school district tax is about 56 cents on the tax dollar,” Metzger said.
“So, we provide the most services for constituents in the county and we have the lowest tax bill,” he added.
Mussare noted that the last time the budget reflected an increase in real estate taxes was in 2017 when they were raised .75 mills to the current rate.