2021 Adopted Program Budget

SCHENECTADY COUNTY NEW YORK ADOPTED 2021 OPERATING BUDGET County of Schenectady NEW YORK Rory Fluman Phone: (518) 388-4355 County Manager Fax: (518) 388-4590 Office of the County Manager 620 State Street Schenectady, New York 12305 TO: The Honorable Chair and Members of the Schenectady County Legislature FROM: Rory Fluman, County Manager DATE: October 1, 2020 _____________________________________________________________________________ I present to the Schenectady County Legislature the County’s 2021 Tentative Operating and Capital Budgets. These financial plans represent estimates of expenditures and revenues grounded in the information and data currently available. These budgets are presented in an environment of fiscal uncertainty which will undoubtedly remain in flux for the next few months to come. The timeline for Federal financial assistance remains uncertain and not guaranteed. The County must remain nimble in managing these plans to accommodate shifting revenue sources and increased demands on County services upon which the residents of the County depend. On March 13, 2020, Schenectady County declared a State of Emergency due to the COVID-19 pandemic. The County remains in a declared State of Emergency with each County department affected. Schenectady County government has displayed unquestionable strength and character during the COVID-19 pandemic. So much has changed in a short period of time – the world around us; our neighborhoods; gathering spaces; the places we work and call home. Life during COVID-19 has sparked fear, frustration and anxiety all around, and yet we must focus our energy on defeating this pandemic and the challenges associated with it. Nothing is more important than ensuring the health and safety of our community. In short, Schenectady County must continue to govern. The 2021 County of Schenectady Tentative Operating and Capital Budget recommendations I am presenting to you for your review and consideration have been affected by the ongoing COVID-19 pandemic. The Operating and Capital Budgets continue to provide vital service delivery to the residents of Schenectady County with careful attention to the impact on real property taxpayers. To achieve this balance, this budget calls for the implementation of several cost savings measures, management strategies, and use of fund balance for 2021 operations. More so than in years past, the management strategies necessary to manage the remainder of the 2020 fiscal year and the entirety of the 2021 fiscal year will lay the foundation for the development of the 2022 budget. The decisions made today with regards to revenue forecasts, planned expenditures, and use of fund balance will most certainly impact our collective flexibility in meeting the yet to be determined financial challenges and programmatic conditions which will confront us in the months ahead. Property Tax Cap The proposed Schenectady County 2021 property tax levy is $71,804,510 and represents an increase of 1.95% from the 2020 Budget – a proposal that is $1,012,000 under the 2021 Property Tax Cap The unanticipated economic toll of the pandemic has required the County to consider a property tax increase for 2021, a change from the past four budget cycles during which the County was able to leverage positive economic growth to maintain or decrease property taxes. These previous accomplishments are the result of the collective focus and commitment of our County Legislative leadership, management, and staff to serve the residents of Schenectady County in the most cost-effective manner possible. Again, in 2021, spending is controlled in this budget and all resident services are preserved. The average County share of a property taxpayer’s total bill is approximately 21%; slightly lower in the City and slightly higher in the Towns. Were it not for mandated Medicaid and other New York State mandated costs there would be no County tax at all. The permanency of the Property Tax Cap is anticipated to have an impact on the County’s operational flexibility in the future. New York State has linked certain State reimbursement and grant programs to the Tax Cap. For example, in order to receive funding to offset costs associated with State mandated Raise the Age legislation, the State requires counties to confirm that the Tax Cap provisions were met. The State has linked intergovernmental grant opportunities with staying under the Tax Cap as well and may consider linking other State funding streams to the Tax Cap in the future. Moreover, as the State threatens to decrease reimbursement to counties providing State mandated programs and services to address and stem its own budget challenges, continued adherence to the Property Tax Cap law at the local level will be challenging without corresponding mandate relief. Budget Highlights County revenue forecasts for 2021 have been reduced due to COVID-19. A corresponding draw from surplus has been utilized to balance this budget and make up for anticipated revenue shortfalls. In 2021, a reduced schedule of Capital initiatives will be implemented to update and maintain vital County infrastructure. Construction will continue to modernize SUNY Schenectady County Community College, our County Library System, and our Glendale Home. From an operational perspective, while vital services remain available for County residents, including its most vulnerable, the manner and structure under which those services are delivered has been curtailed. Administrative Actions A number of administrative actions were implemented in 2020 and are proposed for 2021 to accommodate current fiscal and environmental factors. Retirement Incentive With the understanding that the 2021 Budget process would be challenging, this legislative body had the foresight to implement a separation incentive to County employees to decrease 2 operational expenses moving forward. That endeavor was a success with 39 employees with an aggregate salary and fringe benefit cost of $956,000 electing to separate from County service. These positions were either eliminated in the 2021 Budget or will be replaced with new employees who will have lower starting salaries, less expensive retirement obligations, less lucrative contractual benefits, and may arguably be younger and healthier translating to lower health insurance costs. Should New York State offer a retirement incentive to State agencies and local governments in 2021, it is very likely Schenectady County will participate to further our cost containment efforts. Vacancy Eliminations To balance the 2021 Budget and minimize the impact to taxpayers, the budget proposes the elimination of a significant number of vacant positions. While vacancy reductions will prove to be difficult for department heads, they were strategic so that vital services can continue to be provided. Departments will need to be creative on how those services are delivered in an environment that is structurally different than in years past. Additional vacancy eliminations may be necessary depending upon the status of the County’s revenue receipts and any action taken at the State level regarding withholds or cuts to State reimbursement of mandated programs. Presently, the 2021 Budget includes over $2 million in savings between salary and fringe benefit costs associated with these vacant positions. Health Insurance The 2021 Budget continues to take advantage of the County's innovative and strategic approach to offering health insurance and pharmaceutical coverage to active employees and retirees. The 2021 Budget builds off experienced savings resulting in an estimated expense which is $2.1 million less than what was included in the 2020 Budget. The County's success in controlling health care costs for the benefit of taxpayers transcends County government and has benefited other local jurisdictions. The City of Schenectady has joined the County in adopting similar plans and policies to help keep health care costs in line with available resources and the City of Schenectady School District and Metroplex have also expressed interest in similar savings options with the County's guidance. While health insurance costs have remained relatively stable and are anticipated to remain so as the County recruits a younger, healthier workforce, this category of expense remains vulnerable to swings. As a self-insured entity that is claims based, the County is particularly susceptible to significant health insurance claims. A tragic, unplanned health event for just a few employees can result in claims of hundreds of thousands of dollars for each individual case. The impact of the pandemic on health insurance claims remains to be seen. There is concern in the medical and insurance fields that, due to fear of contracting the virus, individuals may not schedule wellness appointments or exams which would result in an early diagnosis with less expensive treatment options or will seek medical care only when symptoms are more pronounced resulting in treatment which is more costly and longer in duration. There is a risk that 2021 medical claims may see an increase if the pandemic continues to be a sustained event. 3 Capital Investments In recent months, the County has purchased two buildings which are service delivery hubs of County government. Specifically, 388 and 797 Broadway within the City of Schenectady are the place of business for Social Services, the District Attorney's Office, Probation, along with several other departments. Terminating long term leases under which the County was responsible for property

Load more