On Thursday, July 9, County Manager Penny Postoak Ferguson presented her proposed FY 2021 Budget to the Board of County Commissioners during a Committee of the Whole session. The budget includes a stable mill levy for another year with changes from the COVID-19 pandemic. The pandemic impacted both the current and future budgets.
“With the impact of COVID-19 on our revenue, as good financial stewards we have budgeted conservatively, avoided utilizing our reserves and drafted contingency plans should the financial outlook worsen,” said County Manager Penny Postoak Ferguson. “Our board’s priorities and the feedback from our residents in our annual community survey guided our decision making. I am proud of the work our organization has done to navigate this pandemic and continue serving our community.”
The county’s proposed FY 2021 Budget totals $1.25 billion, less than the current total budget, with expenditures estimated at $931.5 million and reserves set at $321.5 million. The funding supports the departments and agencies that comprise Johnson County Government to serve and protect a county population of more than 615,000 residents.
The proposed budget for next year maintains the county’s current taxing levy at 19.036 mills, retaining Johnson County’s traditional position of having the lowest mill levy among all 105 Kansas counties. Constant mill levies are also earmarked for the Library Taxing District (3.904 mills) and Park & Recreation Taxing District (3.090 mills).
Preparation of the proposed FY 2021 Budget has been under development since early 2020. Staff paused the budget planning process for several weeks in the spring due to COVID-19 when the county focus shifted to bridging projected funding gaps in the FY 2020 budget. County leadership and budget staff made $25 million in expenditure reductions for this year to avoid utilizing reserves. The reductions included a hiring freeze (except for essential positions), and tools such as furloughs, overtime reductions and capital project deferment. Where it makes sense, some of these savings will carry over into 2021’s proposed budget.
Anticipated revenue reductions include an expected 2.1% in uncollectable ad valorem taxes, a 10% decline in sales tax revenue and less interest income for the county’s General Fund from reductions of the prime rate by the Federal Reserve Bank. The investment interest loss for FY 2020 was estimated at $5.7 million as well as similarly low projections for FY 2021.
The proposed FY 2021 Budget includes $6.6 million in budget reductions, including 69 eliminated or unfunded positions without any layoffs of county employees. Reductions included staff taking on more work, potential slight service delays, reduced nonessential travel and training, deferred internal repairs and upgrades, and deferred projects and studies.
The budget aligns with the board’s priorities, including completing major capital projects, protecting the county’s vulnerable and aging populations, optimizing the funding available for transit and focusing on innovation.
Ongoing improvements to the Park & Recreation District and Library system are also included in the budget proposal.
Benchmarks in the 2020 Community Survey were also incorporated in the new budget to ensure maintaining the county’s highly-rated quality of life with public safety and low crime rate as a top priority, “making sure that necessary health and human services are available” as the No. 1 most critical role in the next 10-20 years and providing emergency medical service as the county’s most important service to residents.
The survey listed mental health services, aging services, addressing homelessness, public health and public transportation as the top areas for additional resources.
The amount of county tax (26.030 mills) on an average $346,000 residential property will be about $1,036, or approximately $86.33 per month, in 2021. The estimated county tax on an average $2,330,390 commercial property will be approximately $15,165 in 2021. The county’s property tax does not include other taxing entities, such as the state of Kansas, cities and school districts.
The approximate amount generated by one mill of property tax was placed at $11.5 million in 2021. The property appraisal value in Johnson County was estimated at $11.7 billion next year.
Highlights of proposed FY 2021 Budget include:
A Capital Improvement Program (CIP) totaling $153.5 million, including:
The new budget adds 35 new FTEs, including staffing for a new Med-Act station in Shawnee and the newly opened Medical Examiner Facility in Olathe, for the expanded Tomahawk Creek Wastewater Treatment Facility when the project is completed in Leawood and for the recently created epidemiology division of the Department of Health and Environment, and additional park police for the Park & Recreation District.
The county manager proposed a 2% salary merit pool in 2021 for county employees. The traditional rate in previous years was 3%. It also includes a 1% bonus pool.
The BOCC will review the budget proposal and meet with county departments and agencies in a series of work sessions from July 15 to July 21.
“Residents are encouraged to learn more about the proposed budget and provide input about county services and programs for FY 2021 and beyond,” Ed Eilert, chairman of the BOCC, said. “All residents are invited to be an active part of the county’s annual budget process and to share their views with board members and county management as we consider and finalize the budget for next year.”
The board is scheduled to set the county’s maximum expenditures in the FY 2021 Budget on July 27 for legal publication to take place on July 31 after final assessed valuation estimates and projected sales tax revenues have been received. Following legal publication, the county cannot, by law, increase the amount of the budgeted expenditures, but can decrease the amount of the operating budget or taxing level in final approval by the BOCC.
The public hearing on the new county budget is set for 7 p.m. Wednesday, Aug. 12, in the Board Hearing Room located on the third floor of the Johnson County Administration Building, 111 S. Cherry St., in downtown Olathe.
The BOCC is scheduled to adopt the budget resolution during its business session on Thursday, Aug. 20, beginning at 9:30 a.m. in the hearing room. According to state statute, the county’s new budget must be approved and filed with the Johnson County Clerk by Aug. 25 if no special election in September, authorized by the board.
The final setting of the FY 2021 mill levy will be established by the end of October with the latest property valuations by the Johnson County Department of Records and Tax Administration. The mill levy calculations are only for Johnson County Government and do not include other taxing entities, such as the state of Kansas, cities or school districts.
The FY 2021 budget becomes effective on Jan. 1, 2021.