Mobile County Commissioners got their first peek the 2015 budget this week, and employee pay raises have been named a “top priority” as the deliberation process moves forward.
Finance Director Michelle Herman told commissioners the early projections, which were calculated using figures through June 2014, suggest the county’s income could be decreasing slightly.
Last year’s budget was approved with $121,866,085 in revenue, but this year those numbers are expected to drop 0.57 percent, which equates to $689,588.
The finance department highlighted several condensed parts of the “working” budget, which included a list of several county departments that have requested an increased budget this year.
Herman said, for informational purposes only, it would take an additional $30 million to meet the financial requests submitted during budget preparations.
“Obviously, that’s out of the county’s reach,” she said. “We’re asking everyone to continue tightening their belts as they have been the past few years.”
Even with more realistic expectations, early reports show the county facing a $2 million shortfall as it heads into budget preparations for fiscal year 2015.
“That’s good news if you consider that last year at this time we were looking at a $5 million funding gap,” Herman said. “We’re already $3 million better off.”
Sales taxes, up 2.88 percent through May, have helped. Herman said the increase in sales tax revenue is a good sign of economic improvement, but the county still needs “a few more months under its belt” to get an accurate projection of sales tax income for year.
The new Local Government Health Insurance Plan (LGHIP), which has caused some unrest from county employees, was also briefly discussed. According to the report, the policy change should decrease the county’s project expenses by around $1 million this year.
One “ray of sunshine” for the county is this year’s projected expenditures on debt services, which are currently down and could stay that way for the next two years if interest rates remain comparable.
“Our debt service has typically been $10 million or more annually,” Herman said. “This year we’re projecting the debt service to be about $8.7 million, a decrease of around $1.9 million.”
Though the budget presentation was preliminary, several county officials were present including two of three commissioners, Sheriff Sam Cochran and License Commissioner Kim Hastie.
As he did during a recent Q&A session about the LGHIP, Cochran told the commissioners a salary increase would help offset some of the costs absorbed by employees during the recent health insurance change.
“I just wish you would commit to suspend any capitol improvements until we can get the employees a raise,” he said. “As soon as we commit to that, maybe we can stop some of the bleeding from our departments.”
After the meeting, the sheriff said he was referring to his department’s challenges with retaining deputies and other staff members. According to Cochran, two deputies left the county for better paying positions last week, and several others have taken positions in Saraland and Citronelle.
“We used to be the highest paying organization or equal to the other municipalities, but now we’re falling behind at the county level,” he said. “We used to hire already trained and certified officers from other agencies, but now we’re having to hire personnel and send them to an academy, which requires time and money.”
Cochran said it could take 12 to 14 weeks of paid training before a new deputy can be certified to work in the field, which is one of the reasons he and his department have been so vocal about the costs some employees are seeing under the LGHIP.
Despite those statements, Cochran, along with Hastie, Probate Judge Don Davis and Revenue Commissioner Marilyn Wood, recommended the “expedient implementation” of the LGHIP in a letter to the commission from last September.
The letter from the four officials said based on “information provided by the County’s Administration, it (was costing) the county $42,000 for every week the implementation was delayed.”
“I think the devil was in the details,” Cochran said. “When they showed it to us we knew it was going to be a savings, but the county advisers said we’d be able to bargain and negotiate with the state. In the end, there was no bargaining.”
Cochran said if it had better understood, the county could have possibly negotiated the insurance policy’s terms differently or set some of the savings aside to help reduce the upfront costs to employees.
It’s important to note the letter from last year also strongly recommended merit raises for all employees.
“The commissioners are being pushed on by others to do this or that in the community, but at the end of the day, the employees carry the weight of the county,” Cochran said. “When you start losing seasoned employees, it takes years to catch back up.”
It’s been almost seven years since Mobile County employees have seen a raise, and during the conference on Thursday, Hudson said she was aware of how long it has been. Carl even told reporters following the meeting that employees would “have to receive something, or (the county) would be in trouble.”
Even with the support of the commissioners, the finance department is still working to bridge the $2 million budget gap. Though the burden is less than last year’s, the balanced budget submitted in FY 2014 relied on a one-time transfer of $3,382,310 from the tobacco tax fund that isn’t an option this year.
Nothing has been formally discussed, but Carl said if a raise were included, it would be a flat $1 raise for hourly employees or a 2.5 percent to 5 percent increase for all employees across the board.
In her report, Herman broke down some of costs of the proposed salary increases.
Based on current staffing levels, a 2.5 percent increase would cost the county an additional $1.5 million, and $3 million would be needed to facilitate a 5 percent increase.
Though he wasn’t sure about the exact numbers, Carl said a $1 raise should be comparable in cost to the 2.5 percent increase presented by the finance department.