Picente’s Proposed 2009 Budget
Enhances Oneida County’s Fiscal Strength
 

            Oneida County Executive Anthony J. Picente, Jr., today delivered his 2009 Budget Message to the Oneida County Board of Legislators, noting that turbulent fiscal times require prudent actions by County Government to enhance the county’s fiscal strength in a time of turmoil on Wall Street.

            Picente called for actions to enhance accountability and oversight, as well as to enhance the county’s ability to deliver services that are needed by thousands of Oneida County residents.

            Below is the full text of the County Executive ’s speech to the Board of Legislators             

2009 Budget Address,
Anthony J. Picente Jr., Oneida County Executive  

Honorable Members of the Oneida County Board of Legislators:

In accordance with the terms of the Oneida County Charter, I appear before you today to present the proposed operating budget and capital project plan for 2009.

Today we look to the future in a time when Wall Street is in unprecedented turmoil and on Main Streets across the country, there is crisis in the confidence that government is not capable of doing the things it is entrusted to do.

The budget I present to you today meets those challenges with the integrity to maintain confidence in county government and to continue my efforts to restore strength to Oneida County .

I have made it no secret that this budget will require a tax increase. Last year, when I presented my budget, I outlined a financial plan for the upcoming years to stabilize the County budget.  This plan included tax increases to balance the budget and eliminate our reliance on the fund balance.  Since then, the fiscal situation of the Nation has deteriorated and we must stay alert to the possible cuts that can come our way as a result.  All we have to do to see evidence of this is to look at the wreckage of Wall Street. At a time when sales tax revenue is roughly flat and state government is getting ready for new rounds of cost-shifting, our long-term over-dependency on the fund balance has created structural weakness in Oneida County and taking any other course would be completely irresponsible.

It would also be irresponsible to move forward without taking renewed actions to increase the confidence of our taxpayers that County Government will get the most out of every dollar we raise.

I want to announce to you actions I am taking today to ensure that confidence in our internal controls remains strong:

·                    The payroll function of the Oneida County Sheriff’s Department will be shifted to the Department of Audit and Control. An administrative assistant position now in the Sherriff’s Department will be taken out of that department and moved to the Comptroller’s Office to oversee the accurate recording of the payroll and overtime for the Sheriff’s Department.

·                    The Purchasing Department is now authorized to reject any purchase order from any department that deviates at all from the items requested in the budget process.  A Principal Account Clerk position in the Sheriff’s Office will be eliminated and the Purchasing Department will have a position added so that we can strengthen our ability to act as a first line of defense to control spending.

·                    Three auto mechanic positions in the Sheriff’s Department will be transferred to the Department of Public Works. This is sound management practice because those employees work at the DPW garage already. This change means that we centralize all vehicle repairs and preventive maintenance under the auspices of DPW. Giving the DPW the authority and responsibility for this added work increases our management control and increases efficiency.

·                    I will be asking you, in this budget, for $50,000 to conduct a policy and procedure audit of the Oneida County Sheriff’s Office to focus on managerial efficiency. Future actions regarding purchasing and payroll will be taken at the conclusion of that audit.

·                    Two Public Health Engineer positions will be eliminated out of the Public Health Department and those duties will be contracted out.  This move will save the County over $100,000 a year in salaries.

·                    As part of our continuing fight against NYRI, I have added to the NYRI budget to fight this ill-conceived plan. $105,000 has been appropriated so that we are better equipped to make sure this power line never goes in.

·                    There is only one position being added in this budget.  It is for a Deputy Director to Veterans Services.  Looking at the numbers from the Veteran’s Office in 2007 it is clear that another employee is needed.  In the Utica and Rome offices there were a combined 5,200 face to face interviews conducted and 10,167 phone interviews.  In total, the office took on 1,667 new clients.

It is clear to me that we need to further tighten controls in all of the County departments and as of today, we will do just that.

A budget is a fiscal version of the vision we have for the County of Oneida . As you begin your discussions of this proposal, let me focus on the vision behind the numbers, because it is that vision we must keep in mind as we work to develop a stronger economy while meeting the rising human services needs of our people.

I sought a full four-year term as Oneida County Executive so that I could build a strong county that can act on its own, with the fiscal strength to chart the right course for our dreams and our future. This spring, we received a stamp of approval on our initial efforts when Standard and Poor’s upgraded Oneida County ’s credit rating. This is the first upgrade our County has seen in seven years.  At a time when the infrastructure of this county requires major investments for our airport, our business parks, our roads, and our education and community institutions, a strong credit rating is essential. This year we must build upon what we have done to build an even stronger fiscal position.

We are living in a time of unprecedented uncertainty in the financial markets. Let me mention two ways this affects Oneida County :

1.                  The state is projecting there will be a $3 billion revenue hole in the 2009-2010 state budget from the ripple effects of the Wall Street crisis. We are already hearing that the next state budget could trim between 6% and 15% from money shared with local governments. That means millions in cost-shifting is coming our way, and it will be coming long after this budget has been adopted. It’s likely to get worse, not better.

2.                  With this new crisis, state and federal priorities and resources are going to be focused elsewhere. If we want to grow our own economy in this fiscal environment, we cannot expect Washington or Albany to send us the cash to do the job. We must be strong so that we can respond to new challenges and pursue new opportunities.  Every economic downturn has an economic rebound – but the rebound only happens in areas that have the vision to invest and are ready for that recovery. I want us to be there when the tide turns, and job growth returns to New York State .

More jobs. A better economy. Stronger communities. That’s the vision of where we want to go. Today, the picture is very different – a difficult economy, increased needs for county services, a very clear expectation of cuts from state government and a time of stagnant consumer spending that is impacting sales tax revenue across New York State .

These pressures on County Government have been met during our budget review sessions with endless rejections of new spending. All departments’ proposed budgets were cut down to the absolute necessities.

For many people, particularly taxpayers, the bottom line of a budget is whether or not it increases the tax rate. This budget will increase taxes, because increasing county real property taxes is the only reasonable, prudent course open to us.

Let me talk a minute about taxes. Oneida County has one of the lowest county property tax rates in the state. County taxes are usually the smallest property taxes paid by a homeowner, well below those of a school district and usually below those of a city or village. In the city of Utica , for example, a person who owns a home assessed at $75,000 currently pays less than $2 a day for county government’s services. Even with this tax increase, which represents an increase of 8.9% on the total tax levy over 2008, the total paid remains well below that level.

No one ever likes taxes. But for less than $2 a day, this is the value being delivered:

·                    Programs funded through the Youth Bureau served almost 40,000 young people in 2007 through agency and municipal partners.

·                    The Oneida County Sheriff’s Office Road Patrol responded to 12,760 complaints in 2007. The County Correctional Facility housed 4,487 inmates last year.

·                    Our Probation Department handles cases involving about 1,000 youth per year

·                    The Department of Social Services, working with community partners, put 1,151 Temporary Assistance applicants and recipients off the welfare rolls and into employment.

·                    The Office for the Aging Processed 5,789 referrals for information, assistance, and home visits for aging and long term care services for Oneida County residents and provided ongoing case management and in-home community based services to approximately 3,500 individuals during 2007.

This list can go on of the thousands of lives touched by the work County Government does day in and day out.

This budget continues that mission:

·                    We will fully fund our commitments to our local libraries and the Utica Zoo. 

·                    We will provide Mohawk Valley Community College with a $212,000 increase – that’s up 2.9% over this year -- to address its needs at a time of state cutbacks and a time when its education and training services have never been needed more.

·                    We will live up to our commitment to local towns by responding to higher fuel costs and increasing the funding we pay them to plow county roads by about $500,000.

·                    We will take pro-active steps to provide better service to the people who need us by making long-overdue salary adjustments so that we can keep good employees. One of the messages I have heard over and over from department heads is that we can’t find or can’t keep people in essential positions because they can find better pay elsewhere. In the past few months, we have heard a number of requests for upgrades. This budget calls for about $500,000 worth of salary upgrades for around 400 men and women. Case workers and social welfare examiners are the majority of the upgrades with the total amount being added around $400,000, including benefits.  These are the people who are on the front lines of providing needed services to the people or who are an integral part of our system of accounting for the dollars we spend to fight fraud. Their current salaries are well below the comparable positions in surrounding counties and we have actually been losing people to those counties, after they are trained.  It costs around $26,000 to train a case worker and takes one year before they can handle a full case load.  This is why it is so important we bring their salaries to a more competitive rate and therefore we can hopefully retain the employees after they are trained.

The growth at Griffiss will continue. Our day-to-day operations this coming year will see the full impact of our actions to privatize the FBO at the airport – resulting in 6 positions cut. This, combined with new hanger construction and the renovation of Building 100 for more growth at Empire Aero, will not only help balance costs and revenue, but also create economic opportunity. 

State mandated programs continue to remain a major factor pushing spending higher. The Medicaid “cap” has ended huge spikes in costs, but our Medicaid costs are still increasing by 3% every year – and 3% of $50 million is a substantial amount of money. Mandated programs such as the Education of Handicapped Children and Early Intervention Program keep piling on costs when the state reimbursements are becoming less and less.  As and example, our child care costs are around $1.5 million and our TANF program costs around $1.7 million.  As you can see, these mandated programs add significant costs to our budget.  In contrast, our discretionary spending was only increased 2% for a total of $800,000.

We can anticipate this situation becoming worse in 2009. As all of you know, counties in New York State have the major share of their budgets determined by reimbursements set by New York State for programs the state requires us to operate. The system has favored the state from the start, and always will. At a time when Albany is facing extreme new pressures to cut spending, we must be alert for, and expect, massive cost-shifting. I would like to remind all legislators and to inform the public, when you hear that Albany has cut 2, 3, or 4 percent across the board, that usually includes our reimbursements, which means we must still offer the same services but we will get paid less.

In addition to using the property tax to help offset these costs, I will be seeking a removal of the sales tax cap on gasoline. At the time the cap was enacted, this Board wanted to protect consumers from a temporary spike in gasoline prices. In all, 13 counties adopted sales tax caps on gasoline. All of them have removed those caps for the same reason I want to remove it here in Oneida County – all it did was deprive the county of revenue without having any real impact on the price of gas at the pump.  In fact, it has hurt Oneida County because the $8 million in sales tax on gasoline we would have collected since 2006 is money we have had to make up through the property tax. This Board acted with good intention to pass the cap, but the facts show it is now time to lift it. I am projecting that lifting the gas tax cap will generate $3 million in revenue for the county in 2009.

At a time when the overall consumer economy shows very cautious behavior, it is no surprise that sales tax revenue is roughly flat, falling even below our own very conservative estimates. Statewide, sales tax revenue was up 1.1% for the April-June quarter. That’s a major concern, since sales tax is the largest revenue item in our budget. We are projecting a very slight sales tax growth in 2009, but we do so cautiously.

Let me be very up front with you. The revenue picture is even cloudier than the spending picture because so much of the spending done by consumers will be at the end of this year – long after this budget has been adopted. The best projections we have are that consumer spending this year will be below that of last year.  We could take more money out of our fund balance, cut the tax increase and make a budget look good on paper. However, that is the kind of risky financial decision-making that has our country’s financial sector in ruins today. I will not risk our financial position on whether there is a good or bad holiday shopping season. We must prepare for the worst, even as we hope for the best.

I am projecting we will transfer $6.8 million from the fund balance to support the 2009 budget. This is one of the smallest transfers in recent years, and is approximately $3.5 million less than what was taken from the fund balance for this year’s budget. When you look at the 8.9% increase in the tax levy, you have to understand that 6% of that increase is due to the structural deficit created by the use of the fund balance.  Not only does it reflect the uncertainty of these times, but also the need for this county to stop trying to cut fiscal corners to avoid a tax increase. We can’t keep tapping our savings to pay the bills, or in two years there will be nothing left. Without a fund balance sufficient to cover short-term cash flow needs, we could end up needing to borrow to pay bills – and that’s the type of bad business practice we should do everything possible to avoid. It is already costing us far too much.

Separately from this budget, you have before you a proposal from the County Clerk to increase fees charged by her Department. This would increase recording fees to $20 and cover page fees to $5. She is projecting that the fee increases will provide $540,000 in revenue which has already been built into this budget.

I want to be very up-front today with the members of this Board and the public. For many years, at many levels of government, when budget realities get to the point that no one wants to face the truth, there has always been a tendency to inflate revenue and hope for the best. The County Charter gives the County Executive veto power over Board actions to add revenue, and I want to make it clear that I believe a veto of an irresponsible revenue projection would be not just my job, but my obligation.

Some of the issues I have touched upon today are familiar. That’s one of the problems. The fundamental structure we operate within has not changed. I believe we need to take a bold step to make changes in one of the largest items in ours and every other budget – public safety.

I want to build upon the work I have been doing with the City of Utica and the Town of New Hartford in regard to the consolidation of 911 operations. I want to take the Whitestown study on police consolidation and make it a document for change, not a document that sits on a shelf.

In this budget, I am proposing that we create a Public Safety cost center to do what should have been done long ago – start from scratch to work with all of the police agencies in Oneida County to deliver police protection at a lower cost with the same amount of protection. Oneida County currently has three cities, seven villages and three towns with police departments as well as the New York State Police and the Oneida County Sheriff’s Road Patrol. There are also 52 Fire Departments in Oneida County .  I have asked our planning department to put together a consolidation grant application to the State for $50,000 to study this proposal and let us turn years of talk into action. My goal is to merge together the operations of all of our municipal forces and then fill in areas that require police services through a department that is a part of the county’s organizational structure – not apart from it – and then scale down the existing sheriff’s functions to focus on corrections, court security and other civil functions. I would see the countywide public safety agency respecting community identities by keeping existing names and existing signage, so that we would have a Whitestown District, a New Hartford District, a Yorkville District, etc. For years, we have tried to tackle this important effort by asking agencies to join the county sheriff’s office. It’s very clear by now that is not going to happen. We are faced with the realities of a decline in volunteers and increased costs to our County’s Volunteer Fire Departments.  We are also faced with duplication of services and competition for the staffing and fund raising.  Equipment upgrades and upcoming communications interoperability issues are fiscally challenging.  We can either give up or try a new approach. I’m willing to give this a try, and I hope that the communities of Oneida County – and this Board – will do the same, so that we can move forward to reduce costs.

In our Capital Budget, we are continuing to make improvements to the Airport, our roads and bridges, county buildings and we are also building a new field house at Mohawk Valley Community College .

This is the second budget I have presented to this Board. It continues the goal that is the core theme of my administration – making Oneida County strong enough to shape its destiny by building up our financial strength and position. This budget reflects prudence in turbulent times, takes pro-active action to ensure that critical services, programs, projects move forward, and keeps Oneida County moving away from fiscal frailty and into a stronger, better tomorrow.

In the coming weeks, I look forward to dialogue with you on this budget. These are challenging, difficult and uncertain times. We must be strong enough to weather these storms, not just for the sake or our budget or our credit rating, but also for the sake of the people who have elected us to make the tough decisions, to act with integrity, and to show leadership.