Washtenaw County Board Sets Priorities

Washtenaw County board of commissioners meeting (March 16, 2011): The bulk of last week’s county board meeting focused on mostly minor revisions to a document that outlines the board’s strategic priorities for setting the county’s 2012-2013 budget. It’s the culmination of several board retreats held over the past two months.

The discussion – along with the priorities themselves – highlighted the fact that county government will need to operate with diminished resources, making investments in a more targeted, strategic way. The budget priorities and decision-making principles developed by the board are intended to guide the county staff as they work to eliminate a projected $20.9 million deficit over the next two years.

The document gives guidance to the county administration to support programs that help residents feel safe and secure, that address the basic needs of children and families, and that increase economic opportunities for residents. The administration is also directed to integrate efforts across agencies to meet the county’s strategic priorities, and to ensure fiscal responsibility by focusing on long-term institutional stability.

Board chair Conan Smith, who led this year’s retreats and who drafted the budget priority document, told his colleagues that unless they make hard decisions to address the county’s structural deficit, they’ll be having these same discussions every two years. [The county operates on a two-year budget cycle.] Their decisions will have a human impact, he said – two-thirds of the county’s budget relates to personnel costs, and Smith didn’t think they could find enough non-personnel cuts to overcome the projected deficit.

Philosophical issues also surfaced during Wednesday’s discussion. Democrat Yousef Rabhi objected to a sentence stating that when the county emerges from this economic crisis, it should be smaller. Despite current rhetoric, smaller government isn’t necessarily better government, he argued. But he agreed with Republican commissioner Rob Turner that streamlining the county’s work was important, and that streamlining doesn’t mean the impact of county services will be reduced.

Kristin Judge raised concerns over a clause stating that mandated programs should initially be funded at their minimum serviceability level. She felt the language was too strong, and that the board shouldn’t be asking other elected officials – including the sheriff and judiciary – to start at that baseline level. Smith argued that elected officials, department heads and other staff are best suited to make decisions about which mandated programs and services deserve more funding – the minimum level is just a starting point.

The document is intended to give high-level guidance to the county administration, and at times during the discussion some commissioners expressed frustration that the board was too focused on wordsmithing. At one point, Wes Prater observed that they seemed to be arguing over “not much at all.”

Strategic Priorities, Budget Principles

Commissioners considered a draft of the board’s strategic priorities and principles for making budget decisions. They’ve been developing these priorities at a series of retreats held this year, led by board chair Conan Smith. [See Chronicle coverage: "County Board Connects, Hard Choices Loom" and "County Board Strategizes on 2012-13 Budget"]

Smith began Wednesday’s discussion by noting that he crafted the document to keep the priorities at a fairly high level, while still honoring a degree of specificity that had emerged in their talks regarding desired budget outcomes. [.pdf file of 2012-13 strategic priorities and budget decision principles]

In its introduction, the document sets out a vision for the county – that Washtenaw County provides leadership to create a world-class community.

Based on that vision, it outlines a series of five “guidances” aimed at directing the county administration and staff as they develop the budget:

1. Support programs that help residents feel safe and secure.
2. Support programs that address the basic needs of children and families.
3. Support programs that increase economic opportunities for residents.
4. Integrate efforts across agencies to meet strategic priorities.
5. Ensure fiscal responsibility focusing on long-term institutional stability.

For each of these guidances, a list of desired outcomes are listed that state what the 2012-2013 budget investments should accomplish. For example, for the first guidance – “Support programs that help residents feel safe and secure” – outcomes are: (1) provide a prompt response to emergencies; (2) target improved mental health and the reduction of substance abuse; (3) improve the strategic integration of human services with the provision of public safety and justice; (4) address homelessness as a public safety and security issue; and (5) consolidate public safety services throughout the county to the maximum extent possible.

The document also includes a list of six general principles that should guide budget decisions. They are:

1. Impacts and outcomes drive investment priorities.
2. Services are delivered optimally by the right provider.
3. Social and financial returns on investment are calculated, articulated and balanced.
4. Both immediate needs and root causes are strategically addressed.
5. Programs are evidence- and performance-based.
6. Mandates that support outcomes and impacts are better funded.

Smith reviewed some minor changes he’d made to the document since it had been previously distributed. The board then considered three amendments he proposed.

Strategic Priorities, Budget Principles: Amendment 1

Some elected officials have noted that they are responsible for providing mandated services, Smith said, and that those mandates should be reflected in the decision-making principles. He proposed an amendment related to that sentiment. [In addition to commissioners, other elected county officials include judges, the sheriff, prosecuting attorney, clerk, treasurer and water resources commissioner.]

The amendment states:

The Board acknowledges that elected countywide and judicial officials have a higher level of accountability directly to the public that is heavily influenced by the Board’s resource allocation decisions and therefore expects and encourages the active engagement of those officials to inform Administration’s recommendation regarding appropriate levels of service around those functions.

Barbara Bergman said that when the other elected officials need resources, the county board should also be informed, as well as the county administration. The board needs to be informed so that they don’t look ignorant, she said.

Outcome: Commissioners unanimously approved the first amendment.

Strategic Priorities, Budget Principles: Amendment 2

The document’s third guidance states: “Support programs that increase economic opportunities for residents.” A list of desired outcomes include this bullet point: “Integrate tourism promotion into our community economic development strategy.” In his second amendment, Smith proposed striking that outcome.

He noted that while the county supports the work of the Ann Arbor and Ypsilanti convention and visitors bureaus, it’s been argued that tourism itself isn’t a core mission of county government. In that light, this outcome isn’t relevant to the county’s general fund budget.

Outcome: Commissioners unanimously approved the second amendment.

Strategic Priorities, Budget Principles: Amendment 3

The fifth guidance states: “Ensure fiscal responsibility focusing on long-term institutional stability.” Smith proposed adding a bullet point to the list of desired outcomes for this guidance:

Reward and nurture the entrepreneurial spirit of the staff and departments that are developing and engaging new plans and ideas to streamline their operations, to provide greater services, and to raise more outside revenue to better serve a greater number of citizens within the county.

This proposed amendment received considerable debate. Bergman began by saying that although she likes the idea of rewarding people, the word “reward” implies that some financial payment would be made. She suggested instead using the work “praise.”

Rob Turner objected, saying there are times when they need to go beyond just nurturing or praising. It doesn’t have to be a financial reward, he said, but if a department goes above and beyond its duty, they should be rewarded in some way.

Bergman noted in the past, the county held an amazing annual employee recognition breakfast, but that became too expensive. Sometimes rewards are just not possible, in this economic climate. County administrator Verna McDaniel clarified that they still give out employee recognition awards, quipping that they just “cut the bacon.”

Turner said he’d be comfortable with “acknowledge” rather than reward – that still gives the administration some leeway, he said.

Kristin Judge then floated the possibility of creating a small fund – possibly $100,000 – from which to reward departments if they do outstanding work. The staff could use the funds like mini-grants to support programs that they wanted to do, but that might not be in the budget. Dan Smith said he liked the idea, but was concerned about putting that level of detail into the priorities document. He didn’t want to hamstring the administration. Judge said she didn’t intend for the idea to be included in the document, but that it was an argument for keeping the word “reward.”

Wes Prater cautioned commissioners, noting that they were talking about tax dollars. Some token of appreciation was fine – like a pen – but they needed to be careful. Leah Gunn agreed, adding that the decision to reward employees or departments was within the administration’s purview.

Turner again proposed changing the word “reward” to “acknowledge.” The document is intended to be instructional to the administration, he said, and after this discussion, McDaniel should understand their intent.

Yousef Rabhi suggested that instead of setting aside $100,000, perhaps the administration could reward departments by letting them keep any savings they identify. So rather than having their budgets cut because the staff finds efficiencies, those dollars would be kept by the department and used for other programs, he said.

Conan Smith wrapped up the discussion by taking Turner’s suggested wording change as a friendly amendment. The final version of the amendment stated:

Reward Acknowledge and nurture the entrepreneurial spirit of the staff and departments that are developing and engaging new plans and ideas to streamline their operations, to provide greater services, and to raise more outside revenue to better serve a greater number of citizens within the county.

Outcome: Commissioners unanimously approved the outcomes specified by the guidance, as amended.

Strategic Priorities, Budget Principles: Commissioner Discussion

Kristin Judge had several questions, comments and clarifications regarding the document. She began by asking whether they would be reprinting the posters that hung in the building, which state the county’s guiding principles. County administrator Verna McDaniel said her understanding is that the current document relates just to the 2012-2013 budget. Judge felt the document was about more than just a year or two. She suggested they revisit the county’s guiding principles at a later date, updating them based on this newer document.

Under the second guidance, Judge clarified that one of the desired outcomes – “Market support services more aggressively so residents have better access to help in times of personal crisis” – meant they would continue to do this. She felt the county already marketed its services. Barbara Bergman pointed out that in some cases they could do a better job – like getting the word out about the county’s prescription drug plan.

Judge then turned to the third guidance – “Support programs that increase economic opportunity for residents.” Is this stating that the county will increase its economic development programs? she wondered. The county already has an economic development & energy department, and supports Ann Arbor SPARK as well, she noted, through the Act 88 millage.

McDaniel said she understood this guidance to mean that the county’s investment in this priority can be either internal or through partnerships. She felt the wording was sufficient to allow flexibility in their approach. Judge wanted to make sure it captured the fact that the county can work with partners, and doesn’t necessarily need new programs or services.

Strategic Priorities, Budget Principles: Amendment 4

Referring to the fourth guidance, Judge took issue with one of its outcomes:

Lead the development and implementation of a “Blueprint for Collaboration” that accomplishes the following:

• Reductions in cost or duplication of the provision of “invisible” services; and
• Increased support for discretionary services that are board priorities.

Saying she loved blueprints, Judge wasn’t comfortable being this specific – to her, it indicated that they were starting something new that would require funding and staff time. If so, that would require a separate board vote, she said, like previous board resolutions in support of the Blueprint to End Homelessness or the Blueprint to End Illiteracy.

Prater didn’t think the word “blueprint” meant they needed a written plan. Conan Smith said the word might be too specific, but the intent is to indicate that the county will provide leadership. Bergman felt that leadership could take the form of personal responsibility for each commissioner – they could each find ways to reach out and engender collaboration in their own networks.

Rabhi agreed with Judge about the language being too specific. He proposed substituting a more general phrase: “To foster collaboration that accomplishes the following … ” He offered it up as an amendment, which Judge supported.

Turner suggested adding “strategy,” and Gunn offered a friendly amendment: “To create a strategy to foster collaboration that accomplishes the following…”

At this point, Curtis Hedger, the county’s corporation counsel, reminded commissioners that friendly amendments needed approval by the entire board. If any commissioners objected to it, the amendment couldn’t be considered friendly and would need to go through the entire formal voting process.

Alicia Ping objected to the amendment. When asked by Gunn to clarify why, Ping said it still seemed to imply that the county would provide funding and staff time. When an opportunity for collaboration presents itself, she said, they should absolutely pursue it. But she didn’t believe they should go out looking for ways to collaborate.

Gunn then asked McDaniel for her opinion. The county administrator said she was listening for their intent, and it seemed clear that their intent was for the county to foster collaboration, if it can be done without a budget. She said the staff already does this, both internally and externally. They’ll continue doing it, but won’t be spending money on it.

Gunn then said she wanted to keep Rabhi’s original amendment, and to point out that the next night’s working session was focused on the topic of collaboration. It’s something the county is already doing, and it’s not costing them money, she said.

Prater noted that they seemed to be arguing over “not much at all.”

Commissioners then voted on the following amended outcome for the fourth guidance:

Lead the development and implementation of a “Blueprint for Collaboration” To foster collaboration that accomplishes the following:

• Reductions in cost or duplication of the provision of “invisible” services; and
• Increased support for discretionary services that are board priorities.

Outcome: Commissioners approved the amendment, with dissent from Alicia Ping.

Strategic Priorities, Budget Principles: More Discussion

Judge had several additional comments and clarifications. Looking at the budget decision-making principles, she noted that the first one – “Impacts and outcomes drive investment priorities” – seems to indicate that staff will need to do more to measure their work and write up more reports. She was concerned about giving staff more work, given how stretched they already are. McDaniel said it’s not her intent to give staff more than they can handle – they would strive for balance, she said.

Bergman commented that they need good measurements in order to secure additional funding from the state and federal governments. Judge agreed, but said it wasn’t clear how that principle applied more generally. Would the water resources commissioner, for example, be asked to report to the board with measurable outcomes? Judge indicated this wouldn’t be a good approach. She later said she had similar concerns with the fifth principle: “Programs are evidence- and performance-based.”

Looking at the outcomes listed under the first principle, Judge asked about the meaning of this bullet point:

The investment should directly address an articulated Board priority attendant to one or more of the Guidances listed above

Conan Smith clarified that the word “attendant” did not refer to a person, but rather meant they should be paying attention to the guidances.

Regarding the sixth principle – “Mandates that support outcomes and impacts are better funded” – Judge was concerned that the explanation for this principle cited minimum levels of serviceability:

The Board believes that all mandates on the County should be funded initially at their minimum serviceability level as determined by accepted law or practice in the best judgment of the Administrator or by policy of the Board. Programs designed to meet those mandates that further target an articulated Board priority and can evidence a high likelihood of succes should be funded above the minimum level.

Judge said this statement doesn’t speak for her, and made her uncomfortable. Conan Smith said he generally agreed, but if the county has 270 mandated programs, some of those really should be funded at their minimum level. The idea is to set the floor there, then let the experts – the elected officials, department heads and staff – determine how much more funding is needed.

Prater said they need to determine what the minimum serviceability level actually is. He’d be happy if they could fund everything at the minimum level, but even that will be challenging. Gunn agreed, saying that if they fund one program at the minimum level, perhaps they’d have more left over for a program that deserved higher priority.

Judge contended that the language was too strong. Are they going to tell the judges and other elected officials that they’ll only be funded at the minimum level, until they can prove that they’re successful and deserve more? Those officials are elected countywide, she noted, and therefore represent more people in the county than she does. She was uncomfortable making that statement to them.

For his part, Rabhi said there was something else that made him uncomfortable. The fifth guidance states: “Ensure fiscal responsibility focusing on long-term institutional stability.” Rabhi objected to one word in the explanation of that guidance [emphasis added]:

Emerging from this current economic crisis, the County should be smaller, stronger and more stable. Our fiscal policies and practices must drive reforms that ensure the sustainability of our programs and workforce.

Rabhi said he doesn’t believe that smaller government is better. It’s the rhetoric they hear now at the national level, he said, but he doesn’t support it. Rabhi recalled listening to president Barack Obama speak at last year’s University of Michigan commencement, where he talked about the good that government can do. Rabhi said he could support having a government that’s more efficient – this economic crisis presents an opportunity to do just that, he said.

Rabhi moved to strike the word “smaller” from the document – the motion was supported by Gunn.

Conan Smith said he totally agreed with that value. But in terms of the budget process, it’s important that the board support the administration in its talks with labor, he said. The reality is they’ll be making decisions for the next two years that will have a human impact – two-thirds of their budget relate to personnel costs, and Smith didn’t think they could find enough non-personnel cuts to overcome the projected $20.9 million deficit.

They need to address the county’s structural deficit, Smith said, or they’ll be having these same discussions every two years. The administrator needs to know that the board supports her as she moves to make the operation smaller.

Gunn pointed out that they might end up smaller, but that doesn’t have to be a stated goal.

Dan Smith observed that they’d gotten to a point that he had hoped they could avoid – wordsmithing the document to death. This document is intended to provide high-level guidance to the administration, and should be taken as a whole. Having the word “smaller” in it or not won’t make a difference.

Turner said he appreciated Rabhi’s point, but to him, smaller means more streamlined. That doesn’t mean the county’s impact will be reduced.

Rabhi agreed with Turner’s point, and said perhaps it was sufficient to clarify this statement with the administration during their discussion. He withdrew his motion.

Conan Smith said Rabhi’s argument got to the heart of what this document is about, and he appreciated the point. They do have to acknowledge that structural reform is necessary, while understanding the purpose of county government.

Ping wanted the county to look at internal restructuring related to employee health care costs. The budget priority document points to a goal of focusing on wellness programs to control health care expenses, she noted, but they need to look at other ways to cut costs there, too.

At that, Rolland Sizemore Jr. pointed out that they could discuss the document until they were blue in the face. He felt that Smith had done an excellent job putting it together, and it was time to move forward.

Outcome: Commissioners voted unanimously to adopt the 2012-2013 strategic priorities and budget decision principles, as amended. [.pdf file of 2012-13 strategic priorities and budget decision principles (final version)]

[A message from board chair Conan Smith regarding these priorities and guidelines is posted on the county's website.]

CSTS Budget

Earlier in the meeting, the board was asked to approve the 2010-2011 budget for the county’s Community Support and Treatment Services department, which provides a wide range of programs for residents with mental illness and developmental disabilities. The budget year they were voting on is well underway – it runs from Oct. 1, 2010 to Sept. 30, 2011. [.pdf of CSTS budget summary]

Commissioner Wes Prater commented that the impact of the CSTS budget is hard to understand, since it covers a different year than the county’s general fund budget, which runs from Jan. 1 through Dec. 31. County administrator Verna McDaniel replied that in the past, CSTS had brought forward its budgets on a quarterly basis for approval. She had asked them to report on a full fiscal year, so that commissioners could see the big picture – that’s what was before them now, she said.

McDaniel also pointed out that of the department’s $26 million budget, the county’s general fund is contributing only $404,000. The rest of the funding comes from federal and state grants and reimbursements.

CSTS director Donna Sabourin told Prater that she’d be bringing the next full fiscal year budget to commissioners for review in September, for the year starting Oct. 1, 2011.

Prater complained that the budget provided was hard to read and didn’t conform to the Uniform Budget & Accounting Act. It should be easier for commissioners and citizens to understand, he said. Prater also wanted to see comparisons with the previous year, as well as a report on the department’s goals and whether those goals were being met. Sabourin told him they could provide the information he requested.

Outcome: The board unanimously approved the CSTS 2010-2011 budget.

Award for “Green” Building

At the start of Wednesday’s meeting, Eric Hackman, a project manager with Tower Pinkster Titus Associates in Kalamazoo, presented the board with a LEED Silver award from the U.S. Green Building Council. The award was for the construction of the county’s 14A-1 District Court building in Pittsfield Township, which was completed last year. Tower Pinkster served as the project’s architect. The 41,000-square-foot courthouse is one of four 14A courts – others are located in Chelsea, Ypsilanti and Saline.

Hackman said the award brings them national attention, and that it was great working with a client who shared similar goals regarding sustainable building practices. Conan Smith, chair of the board of commissioners, accepted the award on the county’s behalf. He credited former commissioner Jeff Irwin – who’s now a state legislator representing District 53 – with championing this approach.

The award came in the form of a large, round etched-glass plaque – Smith joked that he planned to take it home and eat off it.

Communications, Liaison Reports

During the meeting there were several opportunities for commissioners to share communications. Here are some highlights.

Rolland Sizemore Jr. told commissioners that he’d like to schedule a working session to get an update on police services issues. In particular, he wondered about the status of talks between the city of Ypsilanti and Ypsilanti Township regarding forming a joint police department. If that happens, how will it impact the county’s budget? he asked. [Ypsilanti Township currently contracts with the county sheriff's office for deputy patrols – it's the largest contracting entity for that service.]

Leah Gunn serves on the finance subcommittee for the police services steering committee, which makes recommendations to the county board about sheriff deputy road patrol contracts. She said they were waiting until the county’s equalization report is released in April before making a proposal for setting the price of those contracts. The report will give them a better idea of the financial condition of local units of government, she said. [The annual equalization report provides details on the equalized (assessed) value of property in the county, as well as the county’s taxable value. Taxable value is used when calculating taxes for the county, its various municipalities and other entities that rely on taxpayer dollars, such as schools, libraries and the Ann Arbor Transportation Authority, among others.] Rabhi, who chairs the board’s working sessions, said a session on police services is set for late April.

Several other commissioners gave updates from the committees, boards and commissions on which they serve.

Rabhi, an alternative liaison to the Head Start policy council, reported that he’d attended a meeting where much of the discussion focused on human services funding. He urged everyone to contact their elected representatives at the federal level to lobby for continued funding of Head Start. He noted that commissioners had received an invitation to volunteer to read to groups of children during the month of April, and he encouraged them to participate.

At the recent public works board meeting, Rabhi said there was extensive discussion about recycling. Representatives from Recycle Ann Arbor’s drop-off station attended the meeting, to begin a conversation about getting funding from the county. Rabhi said they reported that since instituting a $3 gate fee, revenues for the drop-off station have fallen by roughly $100,000 – they aren’t doing well, he said.

There’s justification to approach the county for funding, he noted, given that two-thirds of the people who use the drop-off station live outside the city of Ann Arbor. He supported some kind of collaboration. At that same meeting, Rabhi said, the staff of the Western Washtenaw Recycling Authority gave a report regarding their move toward single-stream recycling. They’re exploring several options, he said, including potentially taking on debt to build their own facility. If they do that, they’ll likely need the county to back a bond for the project.

Rabhi’s final liaison report was on the county’s brownfield redevelopment authority. That group discussed a range of issues, including the possible elimination of brownfield tax credits, as proposed by Gov. Rick Snyder. This would obviously have a negative impact on urban areas, Rabhi said, making development there not as enticing. Also at the meeting, the authority voted to terminate the brownfield plan with Village Marketplace in Saline, for failure to pay taxes. The group also discussed a proposed brownfield plan amendment for BST Investments, for a property at 2810 Baker Road in Dexter. [Later during Wednesday's board meeting, commissioners scheduled a public hearing for that plan, to be held at its April 20, 2011 board meeting.]

In other liaison reports, Rob Turner noted that he’d distributed a written report to commissioners regarding the Washtenaw County Road Commission. The road commission had recently received a clean audit, he said. Their fund balance of $9.1 million stands at about 25% of expenditures. Wes Prater, a former road commissioner who previously served as liaison to that group for the county board, expressed concern that the road commission has about $30 million in unfunded liabilities for health care and pensions. Turner said he did raise that issue, and that the road commission is working on a 20-year plan to address those liabilities. That expense will be hitting the road commission’s general fund budget harder each year, Turner said.

Kristin Judge praised road commission managers, in particular citing Jim Harmon, director of operations, for being responsive and professional in dealing with residents during the season’s many snowstorms. She noted that they’ve had a busy year because of the weather, and she appreciated their work.

Judge also reported that the National Association of Counties (NACo) recently released their key legislative priorities – she distributed a copy to commissioners. She noted that NACo’s justice and public safety steering committee, on which she serves, passed a resolution of support for the National Initiative on Cyber Education (NICE). And she expressed optimism after hearing a recent report from University of Michigan economist George Fulton, who forecasts job growth for Washtenaw County in the coming years. However, she noted that during a speech about the forecast, he reported that he’d made the calculations before gas prices started to rise.

Appointments

Board chair Conan Smith brought forward three nominations for appointments, which require board approval:

• Juanita House to the Community Action Board for a term expiring Dec. 31, 2011. The board oversees community services programs that are managed by the county’s Employment Training & Community Services (ETCS) department.
• Linda King and Lucine Morrell to the Washtenaw Community Health Organization board for three-year terms expiring March 31, 2014. The WCHO is a partnership between the county and the University of Michigan Health System to provide services to people with mental illness, developmental disabilities and substance abuse problems.

Before the vote, Rob Turner noted that commissioners had received information about these appointments at the last minute. He didn’t know these people, and was concerned because he didn’t have time to review their applications and resumes.

Smith apologized, saying he realized that this was the third time he’d handled it in this way. He said he worked with county staff and leaders of the committees before making the appointments, and that he either knows the candidates personally, or knows someone who vouches for them. Nevertheless, he said he understood this wasn’t a best practice, but asked for the commissioners’ indulgence in this case.

Outcome: Commissioners unanimously approved the three appointments.

Present: Barbara Levin Bergman, Leah Gunn, Kristin Judge, Ronnie Peterson, Alicia Ping, Wes Prater, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith, Dan Smith, Rob Turner.

Next regular board meeting: Wednesday, April 6, 2011 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.