County Administrator’s final budget message 2018-2019

Submitted by Darren Coldwell, Lincoln County Administrator

 

The annual budget assures the efficient, effective, and economic use of the County’s resources, as well as establishing that the highest priority objectives are accomplished. Through the budget, the County Board of Commissioners sets the direction of the County. While keeping in mind both the positive and negative events happening within Lincoln County, the Board is able to allocate resources and establish priorities.

We are all aware of several problems that continue to play a role in the economic future of Lincoln County, including:

Þ High unemployment that is due to decreased timber harvest and the elimination of other natural resource-based jobs.

Þ The designation of the Libby/Troy area as an EPA Superfund site due to asbestos contamination by the former W.R. Grace mine.

Þ The Montanore Mine continues to be delayed by litigation, and the closing of the Troy mine has put a burden on the tax payers of Lincoln County.

Although, these economic hurdles will take several years to overcome, there are some positive aspects of our economy that Lincoln County can look to for growth:

Þ The EPA has committed to cleaning up the asbestos contamination and expects to be completed with the project by 2019.

Þ Many community groups are working to improve the economic situation in the County.

Þ The Stimson mill property was donated to the County, which has formed a Port Authority. The Port Authority is actively pursuing industrial businesses to occupy this property.

Þ There have been several small upstart businesses who are once again investing in the communities of Lincoln County.

Þ The real estate market has rebounded, and new development is taking place, especially in North Lincoln County.

Overall, I feel hopeful about the County’s finances and the overall economy. Even though we have experienced many negative financial impacts within our area, we do see a light at the end of the tunnel as we begin the recovery process. Lincoln County’s goal is to have a stable economy, with guaranteed steadfast revenue streams that provide for a responsible budget. It must always be the goal to provide for state mandated services, and services that are feasible to maintain.

Lincoln County’s taxable valuation for this fiscal year (2019) decreased by -1.08%. Last fiscal year (2018) the taxable value increased 9.48% and the previous year (2017) it increased 2.3%.

This decrease is mainly attributed to the closing of the Troy Mine, and the overall lack of industry in our county. The decrease in the value of a mill for 2019 can actually be viewed as a positive, in that the expected revenue to Lincoln County from the state actually increased by $160,137.

Lincoln County again saw a substantial increase in health insurance cost this year. A 4% increase was absorbed this year on top of a 6.4% in 2018, and a 9.5% in fiscal year 2017. With the ever-increasing cost the Commissioner’s decided to offer to all employees a cash in lieu of health insurance. This creative thinking showed a savings to the residents of Lincoln County of $67,149, even with the above-mentioned increases.

The Commissioners also introduced an employee incentive for an early buyout option to select employees in the fiscal year 2017-2018. This offer resulted in a total of 12 employees that took advantage of the incentive. The Board of Commissioners have also made the tough decision to not replace individuals when they have retired or left the county for other reasons. This has resulted in a continuing decline in the number of full-time employees working for Lincoln County. This alone is a major savings to the budget, and in turn to the citizens of Lincoln County. The Commissioners also have reorganized departments to increase efficiency going forward. Departments and personnel have combined duties, and consequently increased efficiency. The Departments that have seen changes this year are Planning, EMS, Finance, Treasurer, Road, Clerk and Recorder, and Sanitation. The Sheriff’s Department made a significant effort to decrease their budget, even with increased staff, they submitted a budget that is -$378,734 less than the prior year’s budget.

Positions and duties have also been privately contracted, duties have been absorbed by other employees, and some positions have been completely eliminated. With these changes also comes potential frustration from Lincoln County employees. It is of utmost importance to the Commissioners that those who have been burdened with more duties and responsibility be rewarded for their effort. The Salary Review Committee reviewed wages for all non-union employees. It was brought to their attention that employees had received a 1% increase in the last five years. It was unanimously agreed upon by the committee to increase the wages for all by 7.5%. Even with this increase, the overall budget, for fiscal year 2018-2019 still decreased by $532,456 compared to the prior fiscal year.

This decrease is attributed to all Department Heads and Elected Officials making a true commitment to lessen each and every line item in their department budgets.

As a whole, Lincoln County, is in a strong financial position, considering the economic situation that we all face. The re-authorization of the Secure Rural Schools and Communities Act has helped to stabilize the funding for the Road Fund, albeit a temporary fix for a complicated problem.

Fiscal year 2019’s budget once again does not include any revenue from Secure Rural Funding, or an expectation of potential revenue from forest timber sales. Although, it is our hope to receive Secure Rural Funding, the Finance Department has decided to create this budget as if it was not available. The elimination of these important revenue streams, creates a fiscal concern for the longevity of the road fund. Lincoln County is one of only two counties in the state, Mineral being the other, that do not expect its residents to contribute in the form of property taxes to the maintenance, snow removal, or up-keep of their roads. At current levels of spending, and lack of monetary contributions to this fund, it will most certainly result in a complete depletion of the fund in an estimated 5 years. It is with reserve that I recommend that the Commission seriously considers potential additional levies to guarantee the continuation of this fund. 7-14-2501 MCA authorizes the Commission to create such a district, “Subject to 15-10-420 and to raise revenue for the construction, maintenance, or improvement of public highways, each board of county commissioners may levy a tax upon the taxable property in the county.  The tax must be collected the same as other taxes as the board may direct.”  It is also my opinion that the maintenance of non-county roads be discontinued. With continued decrease in personnel it is unfair to expect continued maintenance of private or US Forest Service roads. This will not be an easy decision to make, and by no means should be. If Lincoln County continues to provide the services currently offered, a path going forward will need to be addressed.

The Board of Commissioners made some very tough decisions, seriously looked outside of the box, and made creative thinking a must for the success of Lincoln County this year. It is my opinion that with continued changes Lincoln County will achieve its goal of being fiscally sound.