Washtenaw County Board of Commissioners administrative briefing (May 27, 2009): At Wednesday’s briefing, commissioners heard more details about the county administration’s plan to cut expenses – a plan that will be formally introduced at the board’s June 3 meeting. Also, commissioners appeared to reach consensus on a proposal to cut their own expenses for 2010 and 2011. And a proposed economic development millage was taken off the June 3 agenda.
County administrator Bob Guenzel has proposed that the county’s nearly 300 non-union employees receive pay cuts of 3% and 2% in 2010 and 2011, respectively. In addition, two previously scheduled 1.5% raises in 2010 would be rescinded, and all pay-for-performance incentives would be canceled for 2009 through 2011. Health insurance benefits would also be affected – changes include instituting a $50 medical premium sharing per month, beginning in January 2011.
Guenzel told commissioners that these steps, which require board approval, would save the county roughly $2.3 million. The cuts are part of a broader effort to deal with a projected $26 million deficit over the next two years.
By law, these changes don’t affect elected officials, including commissioners, judges, sheriff, county prosecutor, county clerk and water resources commissioner. Nor do they apply to non-union employees with the sheriff’s department, whose salaries are tied to a separate contract within that department.
In response to a question from commissioner Ken Schwartz, Guenzel said the cuts would connect to negotiations with the 17 bargaining units who represent union employees. (More than 80% of the county’s workforce of 1,350 people are represented by unions.) Those negotiations, aimed at modifying existing contracts, are expected to continue through July.
Cuts to Commissioners’ Expenses
Commissioners have been wrangling over ways to cut their own $600,000 annual budget. At their May 20 board meeting, a proposal by commissioner Leah Gunn – which among other things cut all travel and per diem expenses for 2010 and 2011 – was voted down. A counter-proposal by commissioner Kristin Judge called for a 10% cut to the commissioners’ budget, with details to be worked out later. That resolution was tabled at the May 20 meeting.
On Wednesday, commissioner Conan Smith presented yet another proposal, saying he’d talked individually with each commissioner and thought that this solution could be acceptable. The plan calls for cutting several line items for the 2010 budget, including the amount paid to the lobbying firm Governmental Consultant Services, Inc., led by Kirk Profit – a recommendation originally proposed by Gunn.
The biggest change would be to take a “flex account” approach to several line items, essentially grouping those items into a lump sum and allowing commissioners to spend the money as they choose. Items included in the flex account would be per diem, travel, mileage and fringe benefits, such as health insurance. Some commissioners, for example, use the health insurance benefit while others don’t, and not all commissioners use per diem or travel allowances. The amount per commissioner for the flex account is tentatively $9,900. Funds not spent by commissioners at year’s end are returned to the general fund.
Commissioner Jeff Irwin was a dissenting voice in the proposal, saying he thought it was a silly concept and fraught with all kinds of peril, but that the amount of money involved was so small that it wasn’t worth fighting. Commissioner Wes Prater said he found the proposal acceptable for its symbolic value, but he also said rather forcefully that he didn’t believe commissioners were overpaid and he noted that they have not taken pay increases for several years.
In total, the proposed cuts would reduce the commissioners’ budget by about 6%. The biggest line item – their salaries – accounts for $177,387 and by law can’t be adjusted until the beginning of their next term, in 2011.
Economic Development Millage
The administration had put an item on the June 3 agenda asking commissioners to approve an economic development tax of 0.017 mills. The amount would raise $250,000 and be used to fund Ann Arbor SPARK and SPARK East in Ypsilanti. Guenzel said it amounted to an additional $1.70 tax for every $100,000 in a property’s taxable value.
Commissioner Ken Schwartz found a state statute that would allow the county to levy this tax for the purpose of growing jobs and reducing unemployment. Like a millage passed in October for veterans services, this would not require voter approval. However, several commissioners expressed concern about levying any kind of tax, no matter how small, during the current economic climate. Irwin said he felt that they should hold a public hearing on the issue, and Guenzel agreed to take the item off the June 3 agenda and schedule a hearing for July or August. Guenzel said the county has already committed $200,000 to Ann Arbor SPARK and $50,000 to SPARK East in 2010. Currently, that amount would come out of the general fund. The millage was meant to relieve the general fund of that commitment.