December 22, 2022
County Council passed legislation on December 6, 2022, to adopt an updated budget for 2023. The primary changes in the budget were increased appropriations in the Sheriff’s Office, the Department of Children and Family Services (DCFS), and the Medical Examiner’s Office. The increases for the Sheriff’s Office and DCFS incorporated substantial pay increases designed to facilitate hiring and retention of staff, which is a major problem in both offices. The Sheriff’s Office budget was also amended to properly reflect anticipated overtime costs. The changes to the Medical Examiner’s Office primarily reflected filling of vacant positions and contractual expenses that came in higher than expected. The budget also incorporated an across-the-board pay increase for non-bargaining employees, designed to better track the market and also assist with hiring and retention of staff.
You might think that these additional appropriations would through the budget significantly out of balance; however, that is not the case. Revenues are also coming in higher than projected, leaving the balance between receipts and expenditures essentially unchanged.
Because of the influx of federal stimulus money, the County’s General Fund is in very good shape, with reserves well in excess of a target level of 25% of a year’s expenditures. The Health & Human Services Levy also is in decent shape, with reserves that are sufficient to keep us on track with our plan that the 2024 Health & Human Services Levy be a renewal, rather than an increase.
The County’s finances are in very good shape on the operating side. The concern is with potential capital expenditure needs. With the new jail estimated at $700 million, the justice center renovations likely to require several hundred million, and the pending request for assistance for renovations of the Browns’ stadium, our borrowing capacity faces challenges. The current high interest rate environment makes these challenges worse. The County will require careful planning on how to handle its capital expenditure needs in the most cost-effective manner.