Monday was a great day for the county to avoid increasing taxes. That may just be good news for the Board majority which voted to raise taxes in 2015. So where did they find this extra money? In the unlikeliest of places.
Monday the management company of the Employees Benefit Trust, Erin Collins & Associates, presented some details about the operations and fund balance. This "Internal Service Fund" (they charge other departments in county government for goods and services) balance of $9.4 million, was $2.7 million more than needed according to the actuary.
Supervisor Hildy Angius is chairwoman of the EBT board; in their recent meeting the board voted to recommend a reduction in funding, by keeping $1.5 million more in the General Fund. That certainly helps the county's budget this year.
The idea of excessive fund balance may sound vaguely familiar, because that's what I said last June. At that time, all the internal service funds had over $20 million, including the EBT. While the EBT has actuarially established guidelines that justifies a $9.4 million balance, why is there $11 million in the other funds?
Those funds, such as Vehicle Replacement, IT, Communications and even the Janitorial fund, have outrageous balances. Management should charge the various departments, such as Sheriff, Recorder and Treasurer's offices, for the actual cost of various services and equipment on a cost reimbursement basis. Instead, it's been very profitable to run an Internal Service Fund in our county. Just how profitable?
In the 10-year period ending June 30, 2014, the balances increased 400 percent, from $4 million to $20 million, including the EBT's $9 million. That is a dramatic jump! The county supposedly charges departments for the "actual cost" of the various goods and services, not more than the real cost.
That large an increase in the cash balance over the worst economic period since the Great Depression, begs the question: Why is the county over-charging other departments? Why are the balances so large?
After the county withdrew $3 million from the Vehicle Replacement fund, there is still over $4 million. Why does the fund need four times their annual budget? Can you imagine any "emergency" where they would have to purchase $4 million more vehicles? Neither can I. What expert is saying they need that much taxpayer money in the fund?
The same questions can be asked about the Carpool (vehicle repair) Fund with $1.8 million balance on a $2 million budget, the Janitorial fund with $400,000 balance on a $500,000 budget, and so the list goes on for a total of $11 million. You get the picture.
Forget the EBT balance and ask yourself: Why did other fund balances increase ten-fold over the last 10 years? The county charges $750,000 for vehicle replacement to the Sheriff's Office. But they DON'T receive 75 percent of the new vehicles every year. Maybe, if the County didn't charge the Sheriff's Office that money for the next three or four years, they could get another six to eight deputies. And the county could STILL invest the excess fund balance for needed vehicles in that department.
I'm glad the county "found" the excess health trust fund money. It's long past time to "find" the rest of the money. It's time to remind them it's not their money, rather it is the taxpayers' money and they should listen to the people. Nobody says they don't need reserves, just not $11 million. However, a neighboring county shows no Internal Service fund balances. But how much is enough?
In this era of lower personal incomes and fewer jobs, especially in Mohave County, it's time for the county to do some real belt-tightening, and not increasing taxes. They need to be good stewards, not large hoarders.