County budget policy may be reviewed next year
When the new board of Kent County commissioners convenes in January, there will be seven members that weren’t on the roster for the past two years.
The seven will join the returning dozen commissioners, and all 19 will have a chance to change the way the commission conducts its business next year when its Standing Rules will be reviewed.
Perhaps the most important issue they will examine is how the board puts together its general fund budget. The method has been increasingly criticized the past two years, after being faithfully followed for decades.
“From my viewpoint, the process is flawed. The reason it worked so well for so long is because we had lots of money,” said County Commissioner Stan Ponstein when the board adopted the 2011 general fund budget Nov. 18.
Ponstein, who will return to the board in January, joined seven other commissioners, including some outgoing members such as Brandon Dillon and Keith Courtade, to try to amend the $165.1 million budget at the adopt-or-reject budget meeting. They wanted to raise the county’s spending for its farmland preservation program from $275,000 to $350,000 in order to collect matching grants from local foundations.
But Commission Chairwoman Sandi Frost Parrish said their attempt was out-of-order. She based her decision on the county’s budget policy, which is established in its Standing Rules derived from Robert’s Rules of Order. The policy doesn’t allow for an amendment to be made to the budget at the board’s adoption meeting after the Finance Committee has approved it. A motion to override Parrish’s ruling failed by an 11-8 vote.
Outgoing Commissioner Bob Synk tried to add $1 million to the budget from the reserve account to keep the 20 county employees who are to be laid off in January on the job. “So we are going to be doing harm to 20 families and we don’t have to. We have the money to save these jobs. We are doing harm to the economy,” said Synk. Parrish, however, also ruled his request out-of-order. Synk’s motion wasn’t supported, so a vote to override Parrish’s ruling never materialized.
The key policy issue seems to center on committee assignments and, to a lesser extent, the committees themselves. Nine commissioners will be assigned to the Finance Committee next year and nine will be named to the Legislative Committee. The rub, though, for roughly half the board is that only the nine Finance Committee members are directly involved in putting the budget together.
“I think everybody needs to be able to speak to the budget,” said Commissioner Dick Bulkowski, who was re-elected in November.
Ponstein said each commissioner represents about 35,000 residents but only half of those elected officials are involved in the budget discussions, meaning half of the county’s residents don’t have input into how their tax dollars are spent. Ponstein added that the committees should be eliminated and every item should come directly before the full board.
“Literally, half the commission is shut out of the budget every year,” said Commissioner Bill Hirsch, who is returning in January.
But returning Commissioner Roger Morgan, who chaired the board for four years before Parrish was elected this year, reminded commissioners they had a chance to change the rules last year but failed to do so, and the current rules need to stand. Morgan ruled two attempts to amend the budget last year as being out-of-order and his rulings were upheld by the board by 10-9 votes.
Parrish said she wasn’t on the Finance Committee either and the commission has to follow the policy it has approved.
“It’s debatable, but not amendable,” she said. The Standing Rules are reviewed in odd-numbered years and will come before the full board again next year, including the budget policy,
“I think when we get to addressing the Standing Rules next year, we’ll have to look at the relationship between the Finance and Legislative committees,” said Commissioner Carol Hennessy, who is vice chairwoman of the Finance Committee and will return in January.
There were two general fund spending issues that primarily fueled the budget policy discussion. One is the funding for the farmland preservation program. Last year, a county subcommittee headed by Parrish filed a report with the board calling for the Purchase of Development Rights program to receive $1 million from the general fund over three years; commissioners allocated $275,000 to it for 2010 in December 2009. This year, the board allocated another $275,000 for 2011. But some commissioners felt the allocation wasn’t enough — that another $75,000 was needed — and that they had no say in the matter. Courtade said the funding amount wasn’t even discussed at the Finance Committee meetings.
“I feel that everything, every issue, should come before the board, and it doesn’t,” said Courtade, who wanted the increased PDR funding.
Hirsch, who also supported the higher PDR funding, said if the county allocated $350,000 to the program, the additional $75,000 dollars would leverage $85,000 from the Frey Foundation, $100,000 from the Grand Rapids Community Foundation, and a potential grant of $490,000 from the USDA Farm and Ranch Land Preservation Program — a total of $1.02 million, instead of the $535,000 pegged at the current funding level.
“We need to get to $350,000. This almost doubles the potential of the program,” said Hirsch, who added that 35 farms in the county are waiting to be preserved.
Bulkowski said the county will never meet the goal of $1 million in three years at the current funding rate. He said the board agreed to fund the West Michigan Sports Commission at $1 million over five years and will complete that obligation next year, so the commission should do the same for the PDR program.
But Commissioner Art Tanis, who is retiring from the board at the end of this year, said the commission never officially agreed to the three-year funding commitment. “Our board has not agreed to spend $1 million. There never was a resolution received and filed by this board,” he said. “I feel strongly that it should be zero.” Tanis said those dollars were enabling monies for townships because most of them don’t fund the program, despite the farms being located within their boundaries.
The resolution approved by commissioners last December was to spend $275,000 on the program in 2010, and that first-time money will go toward preserving acreage on five farms. But when the board ratified the funding, the $1 million, three-year goal was included in the resolution. So some commissioners may have thought that when they approved the funds for 2010, they also approved the three-year funding plan.
The $275,000 for 2011 was already included in the general fund budget presented to and approved by the Finance Committee. The funding issue didn’t come before the full board. “I’m extremely appreciative of the $275,000,” said Commissioner Jim Talen, who returns in January.
“I would expect that we will reach that $1 million, but it might take four years,” said Commissioner Gary Rolls, who also returns.
The other funding issue is the transfer of money from general operations to the Lodging Excise Tax Fund. Next year will mark the third consecutive year the county has had to do that to make up for the lack of revenue from the hotel-motel tax and to pay for the bonds that built much of the DeVos Place convention center. Other expenses from the account include funding for Experience Grand Rapids, the convention bureau, the sports commission and a small contribution to the Festival of the Arts.
The county transferred $500,000 to the lodging fund in 2009, $1.8 million for this year and $2.1 million for next year, for a three-year total of $4.5 million. The county’s bond payment for DeVos Place is $5.4 million this year, while total revenue from the hotel-motel tax is expected to be only $4.6 million.
“It will never be enough,” said returning Commissioner Dick Vander Molen of the tax receipts for a zero-coupon bond that has yearly rising payments.
“A farmer in Sparta has to bail out DeVos Place,” said Ponstein. “Now taxpayers are on the line to bail out that building.”
County Administrator and Controller Daryl Delabbio said he was speaking with Dick Wendt, a bond counsel and partner at Dickinson Wright, about extending the term of a portion of the 30-year bond, which currently has at least an $11 million payment due in 2031, its final year.
The new commissioners will be sworn in and the board’s leadership will be chosen Jan. 4. The first meeting for the new commission is Jan. 13.