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Unicoi County officials continue budget talks

By Brad Hicks

While they have a general notion, members of the Unicoi County Commission’s Budget & Finance Committee had hoped by the panel’s Monday meeting to have more concrete information on the revenue generated by each penny on the county’s property tax rate.

But, as officials have learned since they last met in mid-May, the figure they need may not be known until after the official start of the new fiscal year.

This matter, along with several other budgetary topics, was discussed during the committee’s June 19 meeting.

Unicoi County Commission Chairwoman Marie Rice, who serves on the Budget & Finance Committee, said she spoke with Unicoi County Assessor of Property Teresa Kinsler the week prior to the meeting and was advised it could be this Thursday before the county’s Board of Equalization completes its work in what is a reappraisal year. After property values have been set at the conclusion of this process, officials can begin work to determine the penny’s worth on the property tax rate.

“Sometime after the first of July we should have those numbers,” Rice said.

Although the definitive figure may not be available until after July 1, the start of the 2017-18 fiscal year, Rice said she understands the value of the penny should remain flat from its amount during the 2016-17 fiscal year. In 2016-17, each penny on Unicoi County’s property tax rate generated $30,342 in revenue.

Still, because the exact value of what the penny will bring in during 2017-18 is not yet known, the committee, which has been meeting since early May to develop the county’s 2017-18 fiscal year budget, opted to hold off on delving further into budgetary matters.

“We were hoping when we met today we’d have the penny and maybe we’d be able to do a little bit more in this session, but we don’t,” Rice said. “Perhaps in our next meeting, sometime after Fourth of July weekend, we’ll try to go over that with (Kinsler).”

Despite this, one outstanding funding matter and a new one were discussed.

During its prior meeting held on May 16, the committee reviewed funding requests submitted by the county’s nonprofit agencies and organizations. One request receiving much of the committee’s attention during that meeting was the request from the Unicoi County Family YMCA.

The YMCA received a $2,375 contribution from the county during the 2016-17 fiscal year. The agency is seeking a $12,000 county contribution in 2017-18.

The committee on May 16 opted to take no action on the YMCA’s funding request. Instead, county officials wanted to review a current financial statement from the YMCA and discussed the possibility of having agency leadership address the request before the Budget & Finance Committee prior to making a decision regarding the county’s contribution.

Rice said the YMCA is seeking the additional funding to offer a “health program” to county employees  which would provide these employees with access to the facility.

Action was again deferred during Monday’s meeting, but county commissioners present agreed they would like to meet with local YMCA officials at a later date to get a better idea of what the nearly $10,000 additional funds would be used for if provided.

Commissioner Gene Wilson also suggested the panel take a look at the contribution the county provides for the Unicoi County Veterans’ Services Program. This program, which is headed by former county commissioner Bill Hensley, aims to help local veterans secure benefits and other assistance.

The county’s Veterans’ Services Program is seeking $7,950 in 2017-18, the same amount it received from the county in the prior fiscal year.

Wilson said he would like to see the county’s contribution toward the program cut as local veterans are receiving more help through avenues that do not receive county funding. He added an office that was supposed to be setup for the program has yet to be established.

“I think that ought to go back to the taxpayers, because there have been people who have called me and they can’t get no help,” Wilson said of the funding contribution.

Unicoi County Mayor Greg Lynch recommended that the committee meet with Hensley before making a decision on the contribution request. The committee opted to follow this recommendation and will ask Hensley to be present during its next meeting in July.

Even though the penny’s value has not yet been determined, Unicoi County Finance Director Phyllis Bennett, has already begun work on the revenue projections for the 2017-18. Through May, the county has received revenue in the amount of $6,544,283. Using this figure, Bennett presented a proposed revenue for the 2017-18 fiscal year of $7,154,125. However, Bennett cautioned commissioners that this projection could change over time as more solid budgetary information arrives.

Rice said by the Budget & Finance Committee’s next meeting, officials should have the value of the penny on the property tax rate, a better idea of the county’s revenues and Unicoi County’s starting fund balance for the 2017-18 fiscal year. She said she would like to see the Unicoi County Commission by the end of July consider the first reading of the county’s overall budget for the new fiscal year.

The Budget & Finance Committee is set to next meet on Wednesday, July 12, at 1 p.m.

The Budget & Finance Committee did hear from one county entity during Monday’s meeting. Unicoi County Director of Schools John English and members of the Unicoi County Board of Education were on hand to present the Unicoi County Schools general purpose budget for the 2017-18 fiscal year.

The schools system’s budget for the upcoming fiscal year is $21,930,101, a reduction of approximately more than $1.8 million from the system’s 2016-17 budget of $23,804,277.

English said the schools system realized another reduction in its Basic Education Program, or BEP, funding from the state due to declining enrollment.

“We’re about 26 kids to the negative this year, for this year’s BEP funding,” English said.

BEP is the formula used to figure out how much revenue the state will provide to a school system each year, as well as the revenue local governments need to provide as a match. Student enrollment, also known as average daily membership, is the primary determiner of funds.

The school system’s total BEP allocation for the 2016-17 fiscal year was $12,810,000. According to the estimated allocation provided to the school system in May, the total allocation for 2017-18 would be $12,834,000. While the projection for the upcoming year is slightly greater, English explained this would actually result in a loss of BEP.

Schools systems equate BEP funding to the number of positions the money represents. In 2016-17, the amount Unicoi County Schools received was equal to 158.13 positions. Because of a state mandatory salary increase for 2017-18, the allocation for the upcoming year is equal to 153.42 positions.

English said this would represent a loss of 4.71 positions. If an average salary of $44,024 per position is calculated, the BEP loss for 2017-18 comes out to $207,353.

This marks consecutive years the local schools system has lost positions due to cuts in BEP funding. But he said school officials have worked to address position losses through attrition and personnel shifts.

“As we’re losing funding due to lack of enrollment, we’re taking a hard look at our personnel,” English said. “This summer and last summer, what we’ve done is as we’ve had retirements or folks leaving, we’ve just absorbed positions and kind of shifted some people instead of filling them, so we’re continuing toward that. I think over the last two summers, we’re at 11 positions now. We’ve lost 17 but we’ve absorbed about 11 that we’ve had people leaving and just not filled it, kind of shifted some people within. So we’re trying to attack our loss of BEP that way.”

The system’s budget also includes several additions totaling $549,176. Along with a 2 percent salary increase for employees across the system, these include additional pay based on experience and a 7 percent aggregate increase in health insurance costs for employees.

The school system, which is on the state’s health insurance plan, currently covers the entire premiums for employees on single coverage and this amount plus 45 percent for those on family plans. Because of increases in insurance costs and declining revenues, the school board intends to revisit the insurance matter prior to October’s open enrollment.

“Right now, we pay 100 percent of our singles and we’d certainly love to keep doing that, but it’s just getting to a place where, as the rates are going up and our funding’s going down, it’s hard to sustain that,” English said.

The school system is also projecting costs to its federal ESEA, federal IDEA and federal Carl Perkins funding totaling more than $110,000.

English said 83 percent of the schools system’s budget is made up of personnel expenditures. The total salaries for 2017-18, which include more than $2 million for benefits such as Social Security and nearly $2.5 million for medical insurance, is $18,346,194.

Remaining expenditures, English said, are made up of items such as supplies, fuel and utilities.

English said the estimated fund balance to end the 2016-17 school year is $3,520,418. He said $447,564 from the system’s unassigned fund balance was required to balance this 2017-18 budget, adding the projected fund balance to close out the upcoming fiscal year is $2,131,631.

But, English said, the exact numbers needed to paint a more exact picture of the budget, such as final state allocation totals, have not yet arrived. This, he said, could impact how the school board approaches the insurance matter.

The Unicoi County Board of Education approved the schools system’s 2017-18 fiscal year budget on May 30.

English also briefly discussed several capital projects on the horizon that may affect future school system budgets. He said he intends to look at replacing the more-than-20-year-old heating and air units found in each classroom at the current Love Chapel Elementary School, formerly Unicoi County Intermediate School. English also said the stands at Gentry Stadium are “outdated” and potentially hazardous, adding he plans on getting estimates on what it would cost to correct this issue. He also said some work may be needed in the future at Unicoi Elementary School.