County Budget Moves Toward Final Vote

Washtenaw County Board of Commissioners meeting (Nov. 18, 2009): The county’s administration and elected officials have been grappling with the 2010-2011 budget for nearly a year, and passed a milestone at Wednesday’s meeting with approval of the budget during the board’s Ways & Means Committee meeting. They’re expected to take a final vote at the Dec. 2 regular board meeting. Staff members who attended the meeting seemed visibly relieved.

The board also got an update on the 2009 budget, made appointments to more than a dozen commissions and committees, and approved emergency funding to help provide shelter for the homeless during the winter months. Details on these and other agenda items after the break.

2009 Budget Update

County administrator Bob Guenzel had prepared a PowerPoint presentation to give commissioners an update on the 2009 budget. But when he asked whether they wanted the short or long version of the report, several called out, “Short!” – as a result, his remarks were brief and did not include the formal presentation.

First, some background: In early 2009, Guenzel had projected a $3.3 million deficit for this year’s $103.7 million general fund budget, in addition to a significantly larger deficit for 2010 and 2011. In June, he made recommendations to the board for a first phase of cuts and other strategies to address the deficit through 2011. [See June 3, 2009 Chronicle coverage: "Opening Up the County Budget"]

At Wednesday’s board meeting, Guenzel credited the early implementation of those first-phase cuts for eliminating the deficit in 2009. He also cited cost-cutting efforts by the sheriff and the county courts. Sheriff Jerry Clayton, for example, reduced his department’s budget by about $500,000 this year. In addition, the county’s Community Support and Treatment Services (CSTS) department, working with the Washtenaw Community Health Organization, was able to eliminate $1.5 million from its budget this year, through early implementation of  2010/2011 cuts.

Additionally, among the budgeted 2009 expenditures that weren’t made during the year were $100,000 for north/south commuter rail  (WALLY) and $600,000 that had been set aside for the jail expansion.

Guenzel said that by the second quarter of 2009, he had anticipated a general fund surplus of $250,000 for the year. However, as of Sept. 30 – the end of the third quarter – the county’s 2009 surplus is projected to be $300,284. He’ll report on the final outcome of the 2009 budget in early 2010.

2010-2011 Budget

County administrator Bob Guenzel had requested that commissioners pass the budget on Nov. 18 both at their  Ways & Means Committee meeting and at the regular board meeting that same night. However, the board voted on it only in Ways & Means, a committee on which all commissioners serve. They are expected to take a final vote at their Dec. 2 board meeting. Given that there were several amendments made on the same day as their meeting, some commissioners said didn’t feel comfortable making a final vote until they had time to thoroughly review the finished version of the document. [.PDF file of proposed 2010/2011 budget, with revisions noted]

2010/2011 Proposed Budget

Commissioners asked several clarification questions, but otherwise spent most of the time in their budget discussion thanking the county staff for its hard work, and praising county employees – both unions and non-union employees – for making sacrifices to deal with what had been a projected $30 million deficit over two years. Jennifer Watson, the county’s budget manager, was given special recognition by several commissioners for her patience in responding to their requests for information.

Several commissioners noted that the deficit had been eliminated without massive layoffs – the budget calls for a net loss of fewer than 20 jobs. But they also expressed concern for the next budget cycle, saying that the worst wasn’t likely over. Property tax revenues are expected to continue to fall – the general fund budget of $103.7 million is anticipated to drop to $99 million in 2010 and $98.5 million in 2011.

In addition to the general fund budget, the board voted on two other budget-related resolutions: Changes to compensation for non-union employees, and authorization to negotiate a new agreement with the county courts.

Changes to Compensation and Benefits for Non-Union Employees

This summer, county administrator Bob Guenzel proposed pay cuts and changes in medical benefits for non-union employees in 2010 and 2011, including a 3% salary cut in 2010 and a 2% cut in 2011. The cuts were estimated to save about $2.3 million over the two-year period and affect nearly 300 of the county’s 1,350 employees. [See previous Chronicle coverage: "Opening Up the County Budget" and "Pizza, Payroll and Budget Pain"]

Later in the year, the county negotiated concessions with 11 of the 17 bargaining units for labor unions representing the majority of county workers. Members of five AFSCME units – the largest union of county employees, representing about 650 workers – ratified an agreement in early October. Additional details from The Chronicle’s coverage in October:

Workers represented by AFSCME will forgo a planned 3% pay raise in 2010 and agreed to no raise in 2011. In addition, they agreed to eight “banked” days in 2010 and another eight in 2011. These are unpaid days that each year are a combination of four predetermined dates selected by the administration, and four “floating” days, arranged between the employee and supervisor. They differ from furlough days primarily in the way that the county distributes the pay cuts associated with the unpaid time off, spreading the cuts over 26 pay periods. Each employee’s bi-weekly paycheck will be reduced by about three hours of pay for full-time workers throughout the year.

At Wednesday’s meeting, the board approved a change in the compensation for non-union workers, with an intent to more closely align them with the compensation of unionized employees. Instead of pay cuts, non-union employees will have a wage freeze. Non-union workers now will also have eight furlough days per year – similar to the banked days for union workers – and will forego merit pay. [AFSCME workers continue to receive so-called step increases as well as increases based on longevity on the job.]

According to a cover memo accompanying the board resolution, the proposed changes in non-union compensation – which commissioners ultimately approved – represent 91% of the originally projected savings. The remaining 9% – about $324,000 over two years – will be achieved through attrition of non-union jobs.

Terminating the Memo of Understanding between Washtenaw County and Its Courts

With no discussion, the board also approved authorizing Guenzel to send a notice to the 22nd Circuit Court, 14a District Court and Washtenaw County Probate Court, ending a Memorandum of Understanding that governs the relationship between the courts and the county related to the budget, personnel and other issues. The current memorandum went into effect in January 2004. [.PDF of 2004 Memorandum of Understanding]

The county is responsible for funding these three courts, which are otherwise autonomous. From a cover memo accompanying the Nov. 18 resolution that commissioners passed:

At the most recent meeting of County Administration and the Courts to discuss budget issues, the County Administrator notified the Courts that he would ask the Board of Commissioners to terminate the Agreement by giving the one year’s written notice required under the Memorandum of Understanding. It is important to note that the Courts did not object to the County’s termination of the Memorandum of Understanding, and, in fact, stated that they looked forward to renegotiating a new Agreement with the County during the one-year termination notice period. … This will give the County and the Courts a full year to renegotiate a new Agreement which is more germane to the current economic climate.

The general fund budget that is expected to be given final approval by commissioners on Dec. 2 specifies a combined budget for the courts of $13,003,383 in 2010 and $13,191,513 in 2011.

Funds for the Homeless

At Wednesday’s meeting, commissioners were asked to appropriate $250,000 from funding already earmarked in the 2009 budget for supportive housing services. Of that, $175,000 will be used for an emergency response to increasing demand for service for the homeless during the winter months.

Commissioner Ken Schwartz asked Mary Jo Callan, head of the county-city community development department, to explain how that funding would be used. In response, Callan gave some data on some indicators of the economy. The September 2009 unemployment rate is 9.3%, and more people are living in poverty. At least 1,200 residents were evicted in Washtenaw County last year – and that’s probably a low estimate, she said. Food Gatherers has reported a 35% increase in demand for food since last October, and the Humane Society of Huron Valley has seen a 50% increase in the number of people surrendering their pets because they can’t afford to pay for food and care.

In general, there is a huge demand for services, Callan said, including need from people who’ve exhausted all of their other options. The $175,000 in emergency funding won’t solve these problems, Callan said, but it will provide supportive housing to 10 homeless families – “starting tomorrow, if this is approved.”

For 12 months, each of the 10 vouchers will cover a $900 subsidy for rent and utilities, in partnership with Avalon Housing and other agencies. Families will be asked to contribute 30% of their income as well. The remaining money will pay for supportive services to the families, which might include access to job training and mental health services, depending on the needs of each family.

Callan said that while $17,500 per family sounded like a lot, it was an investment in preventing a downward spiral that could lead to demand for other government-funded services, like incarceration or emergency hospitalization.

Schwartz said that $175,000 could provide housing for a lot of people who’ll be on the street this winter, rather than support just a few families for a year. It was unsustainable, he said, to expect the county to take care of families at that cost.

Callan replied saying that this was just one part of a broader initiative, partnering with the city and the Downtown Development Authority. [Earlier this month, the DDA approved $20,000 in funding for the Shelter Association of Washtenaw County and Interfaith Hospitality Network. The city approved $159,500. The funds will help pay for beds and case management plus staff support for 25 additional beds at the Delonis Center, 25 additional beds in the rotating shelter program, and housing vouchers for eight families. See Chronicle coverage: "Support for the Homeless Shelter" and "DDA Buys Shelter Beds"]

Callan pointed out that the situation was especially dire for families that are homeless. There’s not a facility that can be temporarily expanded to house families, she said. To create a shelter to house families during the winter months would cost the same as using housing vouchers and providing supportive services for an entire year, she said. The latter alternative maximizes stability and dignity, she said.

Several commissioners voiced support for the funding – and in fact, it later passed unanimously as part of the board’s consent agenda. [.PDF file of resolution and cover memo] But some expressed caution as well. Wes Prater said the county needs to do more planning to handle a situation that’s only going to get worse. “Before this winter’s over, we’re going to see something that we’ve never seen in our lifetime,” he said, noting that the weather in November had been mild, thankfully, but that won’t last. “We’re going to have a really really bad time.”

Ronnie Peterson said that this wouldn’t be a short-term crisis – he believes it will be another three or four years before things bottom out in the economy. He wanted to make sure the county tracked the effectiveness of the programs that are intended to help lift people out of homelessness.

Callan said that the staff is requiring people who receive help from these funds to report what happens in their lives, following this assistance. She said the current effort is a humanitarian response to a crisis situation, and that it’s part of a broader initiative to deal with the underlying causes of homelessness. [See .PDF file of county report: "Blueprint to End Homelessness"]

Appointments

Every year at about this time, the board chair nominates people to fill openings on more than a dozen county committees, boards and commissions. Typically, the board of commissioners holds a caucus at a separate meeting prior to the vote, to discuss the nominations. This year, that caucus was scheduled for Nov. 11, but was canceled.

During Wednesday’s meeting, board chair Rolland Sizemore Jr. read aloud the names of his nominations. Not citing a reason, Conan Smith asked that the vote on the Accommodations Ordinance Commission be postponed. In addition, Sizemore did not make nominations for the Community Action Board or the Workforce Development Board, deferring those until the Dec. 2 board meeting.

Sizemore made the following nominations, which the board approved unanimously without discussion:

• 800 Mhz Project Oversight Committee: Paul Bunten, Alan D’Agostino, Jerry Zapolnik
• Agricultural Lands Preservation Advisory Committee: Julie Frost
• Area Agency on Aging Executive Board: Thomas Miree
• Brownfield Redevelopment Authority: James Harless, Suzanne Heiney
• Building Authority: Edward Goldman
• Citizen’s Advisory Council for the Juvenile Drug Court: John Palladino
• Criminal Justice Community Collaborative: Steven Copeland
• Economic Development Corp.: Michael Simon
• Emergency Medical Service Commission: Shoshana DeMaria, Robert Domeier, Ed Dreslinski, Thomas Ensign, Rick Erickson, Richard Fleece, Peter Forster, Ron Mann, Frederick Model, Corey Nygaard, Roger Simpson, John Steinke, Jerry Zapolnik
• Environmental Health Code Appeals Board/Public Health Advisory Committee: Kathleen Fojtik Stroud
• Local Emergency Planning Committee: Rebecca Benedict, Pat Ivey and Sandra Lopez
• Natural Areas Technical Advisory Committee: John Russell
• Parks & Recreation Commission: Janice Anschuetz, Jimmie Maggardrt and Robert Marans
• Public Works Board: James Dries and Eugene Glysson

Apportionment Report

In April, Raman Patel, the county’s equalization director, gave an annual report to the board describing the county’s total equalized (assessed) value of property. That report is crucial because it gives an indication of how much revenue the county will receive from property taxes. [See Chronicle coverage: "Washtenaw County: Equalize This"]

On Wednesday, the equalization and property description department was back, this time with its apportionment report, which gives details of the 2009 taxable valuations for property in the county, by municipality. The report also includes the amount of millages levied and the dollar amounts collected in taxes. [.PDF file of 2009 apportionment report]

Patel couldn’t make the meeting and Dick Steffens, a management analyst in the department, was on hand for questions. Aside from a clarification question from Wes Prater, the only other commissioner to query Steffens was Kristin Judge, who wanted to know what property values might look like for the next tax cycle. She said she was assuming values would be lower.

Steffens paused, indicating he was hesitant to prognosticate. “If I make a comment,” he quipped, “my boss will kill me.”

Accomodation Tax

As part of its consent agenda, the board approved a new five-year agreement with the Ann Arbor Convention & Visitors Bureau and the Ypsilanti Convention & Visitors Bureau, from 2010 through 2014. The agreement will increase the county’s share of the accommodation tax revenues from 5% to 10%. The county collects a 5% room tax from local hotels.

The additional revenue coming to the county will be used by the county treasurer to help administer and enforce the accommodations tax ordinance. [See Chronicle coverage in the report of the Nov. 11 administrative briefing.]

Curtis Hedger, the county’s corporation counsel, said that the contracts provided to commissioners as part of the Nov. 18 agenda were not the final versions. He plans to provide those by the next board meeting. There will be only minor changes, he said. For example, the contracts currently call for a six-month termination clause, and the bureaus are requesting a year.

Though the leaders from both bureaus – Mary Kerr of the Ann Arbor CVB and Debbie Locke-Daniel of the Ypsilanti CVB – attended Wednesday’s meeting, they did not make a presentation to the board.

Items Pulled from the Agenda

Two items originally on the agenda for Wednesday’s meeting were pulled: a vote on eliminating the county’s contribution to the Money Purchase Pension Plan (MPPP) for commissioners, and a presentation by Sheriff Jerry Clayton.

Money Purchase Pension Plan

Background: Over the years last year, retirement benefits for most county employees have been shifted from the MPPP, a defined contribution plan, to the Washtenaw County Employees’ Retirement System, known as WCERS, which is a defined benefit plan. In defined benefit plans, retirees receive a set amount per month during their retirement. In defined contribution plans, employers pay a set amount into the retirement plan while a person is employed. The most common of these defined benefit contribution plans is the 401(k).

The county hopes to eliminate the MPPP completely. Commissioners are the only current county participants, contributing 7.5% of their salary on a pre-tax basis and receiving a 100% employer match. The county also contributes to a voluntary employee beneficiary association (VEBA) on behalf of each commissioner.

At Wednesday’s meeting, commissioner Wes Prater asked that the MPPP resolution be removed from the consent agenda – he then asked that it be postponed to the second board meeting in January. He noted that since the change wouldn’t take effect until Jan. 1, 2011, there wasn’t any rush. [By law, commissioners can't change their salary and benefits during the middle of their terms. Elections will be held in November 2010, with new terms beginning in January 2011.]

The motion to postpone the item passed, with dissent from commissioners Barbara Levin Bergman, Leah Gunn and Jeff Irwin.

Recommendation of Policy for Adding Deputies

Sheriff Jerry Clayton had been expected to make a presentation related to adding contract deputies that would be paid for by Scio Township. [See Chronicle coverage: "Sheriff Suggests Way to Add Deputies in Scio"] However, that item was pulled from Wednesday’s agenda, and Clayton did not attend the meeting.

Misc. Commissioner Communications

During the section of the meeting set aside for items of current and future discussion, commissioner Kristin Judge said she’d like to have a working session on Thursday, Dec. 3 related to budget issues. Though they’ll be finalizing the 2010/2011 budget soon, next year would be a working year, she said, and she’d like the board to be more proactive in giving the administration more guidance about the board’s priorities. Judge mentioned a retreat that the board held in April, but noted that they didn’t emerge from that half-day meeting with any specifics. [See Chronicle coverage: "Budget retreat focuses on broad goals, not specific cuts"]

Commissioner Ken Schwartz said that he generally agreed with the need to be proactive, and said he’d also like to focus on maximizing revenues from federal programs, so that the county can deliver housing and other services using federal funds.

Commissioner Jessica Ping, who chairs the board’s working sessions, said she’d look at the schedule and see what dates were available to put that topic on the agenda. Conan Smith reminded Rolland Sizemore Jr. that Sizemore had talked about holding another board retreat. Sizemore joked that they should move it to Florida.

Public Commentary

Rick Monier: Identifying himself as a resident of Dexter Township, Monier said he objected to the county’s 800 megahertz tower being constructed on the former Chelsea landfill in Lyndon Township. Many people had spoken out against building the tower on that site, he said, but it was moving ahead anyway. It made more sense to put the equipment on an existing tower, rather than build a new one, he said.

During the time set aside for commissioners to respond to public comment, Mark Ouimet, who represents that area on the county’s west side, said he’d been to several meetings regarding the new tower, and had hoped to reach an agreement to address residents’ concerns. He said he was disappointed that hadn’t happened. “It’s a shame that it’s gotten to this point, because it has been very frustrating to the folks who live around that tower,” Ouimet said.

The 800 megahertz project, funded by a millage that passed in 2006, is building a countywide communications network that will allow police, fire, and EMS agencies – as well as organizations like the Washtenaw County Road Commission and the Ann Arbor Transportation Authority – to communicate via one system.

Thomas Partridge: Partridge, a resident of Scio Township, spoke during all four available times for public comment. He said the board needed to take steps to make the boardroom more accessible for people using walkers or wheelchairs who might want to speak during public commentary. He also asked the board to postpone the vote on the budget until at least the third week in December, saying that they needed to give it greater thought. The proposed cutbacks, he said, would imperil local residents. Partridge also noted that on this same evening, the board of the Ann Arbor Transportation Authority was discussing plans to expand public transit service countywide [See Chronicle coverage: "AATA Adopts Vision: Countywide Service"]. He said that residents would get better service if public transportation were handled by a department of the county government, not a separate agency.

Janelle Baranowski: Speaking after the second public commentary by Thomas Partridge, at the end of the Ways & Means Committee meeting, Baranowski began by saying that she wanted every commissioner to look at her while she spoke. She criticized them for treating Partridge with disrespect, noting that some of the commissioners were talking with each other during his public commentary. Commissioners are elected by the citizens, she concluded, and those citizens deserve their respect. [Baranowski has applied for the Community Action Board and the Workforce Development Board. As reported earlier in this article, when board chair Rolland Sizemore Jr. announced his appointments during the board meeting, he postponed action on those two boards, saying that he'll announced those appointments at the Dec. 2 meeting.]

Present: Barbara Levin Bergman, Leah Gunn, Jeff Irwin, Kristin Judge, Mark Ouimet, Ronnie Peterson, Jessica Ping, Wes Prater, Ken Schwartz, Rolland Sizemore Jr., Conan Smith

Next board meeting: Wednesday, Dec. 2 at 6:30 p.m. at the County Administration Building, 220 N. Main St. The Ways & Means Committee meets first, followed immediately by the regular board meeting. [confirm date] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public comment sessions are held at the beginning and end of each meeting.