In his budget message to Manatee County commissioners on Thursday, county Administrator Ed Hunzeker outlined a taxpayer- and employee-friendly spending proposal for fiscal year 2012-2013. The $458 million budget proposal avoids both a tax increase and worker layoffs while providing a wage increase to county employees.
This should play well with voters and commissioners during an election year when four commission seats will be on the ballot. Currently, three of those seats are contested, though candidate qualifying this week could yield a fourth race.
Manatee County's fiscally sound practice of preparing budget outlines beyond the next fiscal year is not occurring this time. Most of the blame belongs to the state Legislature and Gov. Rick Scott for creating unfunded mandates and several unknowns -- "state decisions which repeatedly derail our planning efforts," Hunzeker stated in his message to commissioners.
Last year, though, the board approved an outline that included the coming fiscal year, so many decisions remain in place, and Thursday's presentation focused on major adjustments and updates.
The biggest shift is reversing last year's idea of cutting $4 million, instead spending reserves to maintain most county services at current levels. Hunzeker predicted board and public opposition to program reductions based on last year's uproar over cuts in emergency medical services and transportation.
This year's potential reductions could have come in code enforcement, libraries and animal services -- even spreading to economic development incentives and nonprofit agencies.
Still, modest reductions are sprinkled throughout the budget. Plus, four positions will be eliminated by attrition.
After downsizing government and reducing county spending by $132 million over the past six years while property owners saved almost $83 million in taxes, enough is enough for now.
A 'status quo' proposal
"We believe it would be best to maintain the status quo for a year," Hunzeker stated, "and then take a more strategic approach to budget reductions if necessary in the next biennial budget ..."
This presents a problem of deficit spending as reserves continue to be spent, but the county administrator also noted that as long as the county avoids new budget obligations there are enough reserves for the near future. Since Manatee's bond ratings remain strong -- the AAA by Fitch Ratings is the highest mark -- and the budget proposal retains current reserve policies, those ratings won't be jeopardized, county staff conclude.
While county employees have not received a pay increase in five years, their checks have dropped with the new 3 percent salary contribution into their state pensions and higher payments for health benefits.
The improving job market is luring employees away, and Hunzeker hopes to neutralize that with a "cost-neutral" wage increase. The expense would be offset by restructuring worker benefit costs.
In positive news for builders, Hunzeker recommends a 6 percent drop in permit fees since residential construction is rebounding and building permit revenue is strong.
In addition to holding the line on taxes, owners of properties with falling values will pay less.
In good news from the county's constitutional officers, including the sheriff, all submitted budgets either lower or the same as this fiscal year. But commissioners will have to debate Sheriff Brad Steube's supplemental request for $5.5 million to cover pay increases. That request could go before voters in the form of a tax increase referendum.
The bad news in the budget is the new and unfair state mandate forcing counties to pay up to $325 million in old and disputed Medicaid bills -- some of those up to a decade old. Counties throughout the state are battling this in court. The exact cost to Manatee is not known now, though the county reserved $4.1 million to cover those payments over the next three years.
Another unknown is the impact of several ballot initiatives that would trim property taxes for certain people, thus lower county revenue again.
Amendment 4 would grant tax breaks to home buyers from out of state and Floridians who had not owned a home for at least three years. That could be a boon to the housing and real estate markets, hopefully offsetting that revenue reduction as the population grows.
Still, these quandaries could wipe out entire programs and departments or force consolidations next year under a "worst case scenario," Hunzeker states in his message.
Much is yet to be done on the budget as commissioners pour over the recommendations and public meetings are held into September.
Upon initial review, this budget outline looks like a reasonable and responsible response to yet another year of austerity. And a good starting point for the debate that is sure to follow. Anything can happen in an election year when politics take center stage.