Fiscal Year 2013 Recommended Budget Book - Lake County

Honorable Members of the Board of County CommissionersBudget Message for Fiscal Year 2013July 12, 2012Page 2The other significant challenge to the General Fund has been the opening of the new Court Houseexpansion building. This facility is approximately 168,000 square feet with holding cells, court rooms,and offices. It is anticipated to open in the fall of 2012 with annual operation and maintenance costsexpected to be nearly $1 million per year.My challenge since taking the position of County Manager has been to reduce the size of countygovernment, without reducing services to our citizens. In addition to declining revenues, we are entrustedby the citizens of Lake County with being good stewards of our local funding and resources. Our goalhas been, and continues to be, to provide thebest quality service at the lowest possiblecost. Since Fiscal Year 2008 the budget forthe General Fund has been reduced by nearly29 percent. This was accomplished, in part,by the elimination of 152 positions. We havebeen able to continue to provide the citizensof Lake County with the core services theyexpect. We are at a point where, for thesecond consecutive year, expenses areexceeding revenues and driving reserves toan unsustainable level. This is anunacceptable trend and with the slow pace ofeconomic recovery, it is extremely unlikelythat property values will suddenly increaseand generate additional revenues.In order to balance the budget and maintain an acceptable reserve, I have had to implement a two partstrategy. The first step was to further cut expenses and the second step was to implement the “Roll Back”millage rate to stabilize revenues. I directed the County Departments to reduce their overall budgets byfive percent within the General Fund. The Chairman and I met with each of the Constitutional Officersindividually to convey the dire need to reduce expenses as property values continue to drop and GeneralFund reserve levels continue to erode. The County Departments reduced their budgets by nearly $1.5million or 4.8 percent. Overall the Constitutional Officers reduced their budgets by five percent with theSheriff reducing the transfer for operations from the General Fund by more than $2.6 million.The second step needed to balance the budget and maintain an acceptable reserve is to stabilize AdValorem Revenues. The Recommended Fiscal Year 2013 Budget includes changes to three millage ratesincluding the General Fund, Public Lands Program-Voted Debt, and the Stormwater, Parks, and RoadsMSTU. The General Fund Budget has been prepared using the “Roll Back” millage rate of 5.0816.Setting the millage at this level will keep Ad Valorem Revenues at the same level as Fiscal Year 2012 andthus will keep reserves at 16.8 percent of expenditures. This will meet the County Policy of a minimum of15 percent reserves. The change in the Public Lands Program-Voted Debt millage is needed in order tofund the principal and interest on the debt that was issued in 2007. Historically, there was a very healthyreserve that funded debt payments as property values declined. The reserves have been exhausted,prompting an increase in the millage from 0.1101 to 0.1900. However, properly funding the debt serviceis extremely important in order to maintain the favorable bond ratings the County has with the bond ratingagencies.