Personnel costs top budget | BrainerdDispatch.com | Brainerd, Minnesota

Personnel costs top budget

CROW WING COUNTY BOARD

Posted: December 14, 2010 - 11:02pm

Personnel costs - with $31,735,351 budgeted in 2011 - account for nearly 46 percent of Crow Wing County's expenditures.

The county reduced staff levels for 2011 by 9.5 full-time equivalents. The county reported most staff cuts came through early retirement incentives.

For the past three years, senior county management has taken a pay freeze. The county approached all 13 of its bargaining units for wage concessions for a cost savings. Five of the 13 employee bargaining groups agreed to a zero percent wage increase for 2011. Eight of the unions did not agree and received the 2 percent increase.

Tim Houle, county administrator, said if the county had a crystal ball it wouldn't have entered into a three-year labor negotiation in 2008. The county's labor agreement, established in 2008, called for a 2 percent wage increase across the board for employees.

In employee trends, the county noted a net reduction of 15 managerial or supervisory positions. Hiring a new director in the Land Services division and an environmental services supervisor were the standouts for staff additions among a page list of staff reductions. The sheriff's department is eliminating a captain's position with the retirement of Capt. Neal Gaalswyk and adding a third lieutenant's position instead for an expected annual savings of $102,000.

The labor cost for 2011 increased by 1 percent, or $228,033, compared to 2010. Since 2008, the county has reduced its staff from 485.6 full-time equivalents to 416.1 or 14.3 percent.

The county reports its second largest personnel cost in health care premiums has increased by 14.8 percent for 2011. Additionally, the 2011 budget reflects a $300,402 increase in retiree health care costs compared to 2010. The county's other post employment benefits liability, for retiree health insurance, was listed at $32,784,518 as of Jan. 1, 2009. The county ended those benefits for employees after 2004 and is setting aside money to offset the liability from past employees although the board voted to suspend a plan to put $500,000 into the fund for 2011. In 2007, the retiree health insurance cost was $989,164. The planned 2011 budget for those costs is $1,432,029.

In its 2011 budget, the county is levying $500,000 for costs associated with the federally mandated move for public safety communications to 800 megahertz. The county now has about $3 million set aside for the communications project and expects $3.7 million will be needed. Federal grants also are helping the project cost.

The difficult economy means more residents have turned to the county for services at a time when the county's revenues are falling - from state cutbacks in funding and a declining county property tax base. Additional budget pressures come from the county's payroll and the cost of health benefits. The county presented several examples of potential changes with its proposed 2011 budget and levy depending on property value with the taxes from the county, schools, municipalities and others.

A residential homestead valued at $100,000 in 2010 had a net tax of $343.72. If the home's value is unchanged in 2011, the net tax would be $387.80 and if the home's value was reduced by 5 percent to $95,000, the net tax would be $349.79.

A commercial industrial property valued at $300,000 in 2010 had a net tax of $5,564.89. If the value was unchanged in 2011, the net tax would be $5,996.83 or a net tax of $5,450.78 if the property had an 8 percent value reduction to $276,000.

A seasonal recreational property with a $200,000 value in 2010 had a net tax of $1,409.94. If the value was unchanged for 2011, the net tax would be $1,518.78 and if there was a 9 percent reduction in the value to $182,000 the net tax would be $1,373.88.

The county noted there are property tax relief options for homeowners by filling out the M-1PR state tax form.

RENEE RICHARDSON may be reached at renee.richardson@ brainerddispatch.com or 855-5852.