Berks County

Proposed FY2008 Budget

County Commissioners MeetingNovember 15, 2007

Berks CountyFY2008 Budget Presentation

• Budget Schedule

• Budget Overview

• Budget Initiatives

• Budget Execution Risks and Future Challenges

• Tax and Budget Summary

• Budget Projections

• Questions and Commentary

Berks CountyProposed FY08 Budget

Budget Schedule

• November 15, 2007 Present Proposed FY08 Budget

• December 18, 2007 Adopt Final FY08 Budget

• Public Review– County Commissioners’ Office

– Budget Office

– County Website www.co.berks.pa.us

Berks CountyProposed FY08 Budget

Bottom Line

• The budget utilizes the existing tax rate @ 6.935 mills

• Operating revenue and expenditures equal $460M

• Tax revenue is projected at $125M

• The budget is balanced, expenditures match revenues, so we are not deficit spending

• No fund balance is used to balance the budget

• Unreserved/undesignated fund balance is projected at $83M or 18% of total operating expenditures

Berks CountyProposed FY08 Budget

Initiatives

• Community Corrections • Prison expansion• Ag Land and open space preservation• Financial software conversion• 911/EMA consolidation and relocation• 911 Infrastructure upgrade – New bond issue to cover user radios• Park expansion - Antietam & Haycreek• Not for profits:

– Historical Society– Humane Society/Animal Rescue– Literacy Council

• Reading Area Community College

BOND FUNDED CAPITAL PROJECTS - 2008

2008 revenue- new borrowings $47.0MPrior years bond proceeds $26.0MProceeds available for 2008 projects $73.0M

Recap: Prison Upgrade & Expansion $21.8M 911 System $32.9M Ag Land Easements $8.6M Financial Software $2.5M Other Projects $1.2MTotal capital asset expenditures $67.0M Open Space Allocations $6.0M2008 capital project expenditures $73.0M

Revenue is proceeds from proposed new financings and existing debt instruments.

Expenditures represent consumption of existing and future bond proceeds

Berks CountyProposed FY08 Budget

Other Capital Projects

Funded by tax dollars or grants:

• Voice over IP

• Courts – Jury Pool Software

• Antietam Acquisition

• Antietam Dam Repair

• Haycreek Trail

• Restoration Gruber Wagon Works

• Adaptive Recreation Area

Berks CountyProposed FY08 Budget

Personnel/Staffing

21 New Positions = $628k• Community Corrections 16 • Court - DJ’s Offc. Support 2• Court Reporters 1• DRO – Conference Officer/PT OS 218 Eliminated Positions = $344k• Facilities & Maint.- Seasonal PT 2• Courts – Video Arraign. Master 1• DRO Detective 1• DRO Temp position 1• Career Link Older

Americans – part time 12• Recycling Coordinator 1Extended Temp Positions • Clerk Court OS to 12.31.08 2

Berks CountyProposed FY08 Budget

2008 Execution Risks

Crime impacts on:

• Prison population – 1,213

• Children placements in CYS

• Juvenile placements in JPO and YDC

• Court costs

Operational risks:

• Pension investment performance – ARC Pmt

• Employee health

• New employees

• RiverPlace costs

• Park expansion – Antietam operating costs

Berks CountyProposed FY08 Budget

Future Challenges and Decisions

– Prison expansion/ Community Corrections - addt’l operating costs

– Addt’l Debt service - $36M Open Space/Ag Pres. - $1.8M per yr in 2010

– New $50M bond Issue for 911system – Annual debt service = $3.8M per yr in 2010 – assumes County pays for end user radios - $24.4M ??

– Service levels for Prison/CYS/YDC/JPO

– Tax growth - Assessed value versus inflation

– Federal and State budget cuts

– Non-tax revenue growth – few options

Berks CountyProposed FY08 Budget

Budget Process Successes

• Level of analysis• Commitment to cost effectiveness• Detail request from departments• Communication between all fiscal departments• Budget Office/Purchasing work hand in hand

– Professional Fees, Contracts, Supplies, Equipment, etc– Departments work off of actuals rather than budget

Future Challenge: continue to develop good data, departments understand analysis and cause and effect of revenue and spending patterns

Financial Overview

TAX OVERVIEW

2007 2008

Millage Rate 6.935 6.935

Assessed Value 17,847,725,700 18,151,140,900

Percent Change 2.23% 1.70%

Tax Revenue

Annual Tax Billing $118,289,786 $120,298,188Interims $585,000 $750,000Tax Claim Collections $3,500,000 $3,500,000

Total Tax Revenue $122,374,786 $124,548,188

Note: Tax Revenue is net of discounts and uncollectibles of 4.6%.

2008 Recommended Budget Consumption of Taxes

By Function

Judicial 27%$33M

Emergency 9112%$3M

Misc. 4%$5M

Not for Profits 3%$4M

General Govt. 1% $1M

Comm. & Econ. Developmnt

2%$2M

Public Safety 33%$41M

Public Works -2% ($3M)

Culture/Rec. 6%$8M

Youth Det 1%$2M

Berks Heim -1% ($1M)

Human Services

7%$9M

Debt Service 17% $21M

GENERAL FUND BALANCE OVERVIEW - Year End 2008

Total Fund Balance 117,287,735$

Reservations-Cumulative Losses:

Berks Heim (8,496,193)$ Youth Detention Center (6,255,023)$ Other Reservations:

Worker Comp Trust Fund (3,596,830)$ Hazmat, Encumbrances and Other (1,873,450)$

Designations:

Self Insured Health Fund (4,000,000)$

Environmental Litigation Fund (2,022,325)$ Tipping Fees Solid Waste/Recycling Fund (6,264,356)$

Capital Projects - 2008 (1,340,000)$

Total Unreserved Fund Balance 83,439,558$

2008 AND TRENDED BUDGET SUMMARY EXCLUDING CAPITAL PROJECTS FUND

All Funds 2006 2007 2008

Total Revenue $403,337,998 $438,439,199 $459,906,943

Total Expenses $397,526,202 $431,718,414 $459,906,943

Excess Revenue over Expenses $5,811,796 $6,720,785 $0

General Fund 2006 2007 2008

Total Revenue $193,787,485 $205,623,865 $213,618,599

Total Expenses $175,254,115 $186,886,907 $201,034,904

Excess Revenue over Expenses $18,533,370 $18,736,958 $12,583,695

2009 2010 2011

Total Revenue $463M $470M $478M

Total Expenditures $465M $483M $501M

Net Surplus/(Deficit) ($2M) ($13M) ($23M)

Unreserved Fund Balance $75M $53M $22M

Percent of Expenditures 16% 11% 4%

Includes new debt service related to Agland Preservation / Open Space borrowing $36M.

Includes new debt service for 911 Infrastructure upgrade of $50M

Include additional Community Corrections operating costs for 360 inmates, $9M-2009, $9.5M-2010, $9.9M-2011.

Assumes Union contract renewals are no higher than 2008 rates.

3 YEAR FINANCIAL FORECAST

Comments and Questions