Legislature Moves to Accept American Rescue Plan Funds as Lost Revenue Replacement, Additional Expanded Budget Committee Meeting to Discuss Funds Planned for August 10
Following the Legislature’s agreement in the July 19th Expanded Budget Committee to use 100% of American Rescue Plan (ARP) funds to replace lost revenues and 75% of those funds for cash for the Capital Program, Legislators are planning continued discussions on how to best use a portion of the County’s fund balance to address other community needs highlighted by the COVID-19 pandemic. Using the funds in this manner is one of the stated approved uses in the text of the American Rescue Plan. Conversation included that using roughly $15 million of ARP funds towards cash for capital will free up money in the County’s operating budget by reducing principal and debt service obligations, thereby increasing capacity to fund ongoing expenses.
Legislators stressed that while the nearly $20 million from the federal relief act will be used to supplant lost revenues and invest in County infrastructure through the Capital Plan, their intent is to spend a portion of the County government’s existing fund balance to quickly address community needs. Fund balance dollars may be deployed with fewer restrictions and reporting requirements than ARP funds, allowing such funding to be invested more quickly and efficiently into the community.
A resolution from the Expanded Budget Committee approving the use of the ARP funds to replace lost revenues and to invest roughly $15 million in the Capital Program passed 11-1, with Henry Granison (D-Ithaca) opposed.
An amendment proposed by Legislator Anne Koreman (D-Ulysses) to save 5% (roughly $1 million) for non-County operations purposes failed 4-8 (Legislators Klein, Robertson, Koreman, and Granison in favor) and was followed by further discussion that the plan is still to consider using fund balances to address other community needs.
Chairwoman of the Budget, Capital, and Personnel Committee Deborah Dawson (D-Lansing) announced that following the conversation held in the July 19th Expanded Budget Committee meeting, another conversation will be held on August 10 at 5:30pm. Details on the previous conversation can be found here: https://www2.tompkinscountyny.gov/news/expanded-budget-committee-holds-second-meeting-discuss-american-rescue-plan-funds
Presentation on the 2020 Annual Financial Report
County Finance Director Rick Snyder presented the annual financial report to the Legislature. The report included details from a successful recent audit, investments in capital assets over the past eight years, the County’s debt position, sales tax data, and fund balance information.
Following several inquiries from Legislators in previous discussions on the American Rescue Plan funds, Finance Director Rick Snyder presented further details on the current state of the County’s fund balance. The current unassigned fund balance is $48 million, which has increased $29.9 million over the last eight years as surpluses have occurred. The current County policy is that at least 10% of general fund operating revenue should be held in the unassigned fund balance. The 2021 budgeted operating revenue is $171.6 Million.
Discussion followed on what the appropriate percentage of operating revenues reflected in the unassigned fund balance should be in any potential future policy revisions. A recommendation from Snyder would change it to a range of 18-23%, whereas an association of County Finance Directors recommends two months of operating revenues - around 16.7%. The County’s current fund balance has hovered around 24% over the past several years. Snyder’s proposed policy of holding between 18-23% would be designed in-part to protect against the need for short-term borrowing as the cash flow for the county is cyclical throughout the year.
Legislator Rich John outlined that the County’s fund balance was critical in the past year to weathering the COVID-19 crisis. Allocations from the fund balance were used to support the local pandemic response. Legislator Mike Lane suggested that the fund balance represents stability for the County to respond to future crises like the pandemic.
Among Other Business
A resolution to support a new workforce development program at Tompkins Cortland Community College passed unanimously (12-0, Legislators McBean-Clairborne and Schill were excused). The resolution supports a $750,000 three-year commitment from Tompkins County before the program is predicted to become self-sustaining.
The Legislature unanimously (12-0) adopted the 2021-2022 Tompkins Cortland Community College operating budget. The commitment from Tompkins County is just over $3 million and represents a 1.6% decrease over last year as enrollment of Tompkins County residents has declined slightly.
County Attorney Jonathan Wood updated the Legislature that the County is set to receive a portion of the settlement being reached with states, municipalities, and opioid distributors. Further details about the settlement are expected to be announced later this week and amounts to be received by municipalities for addiction and prevention services will be clarified over the coming months.
$2.6 million in grant funding from the Federal Government was accepted for COVID-19 testing in schools. The Health Department will use the funding in a contract with TST-BOCES to support getting symptomatic students tested before going home to reduce barriers to access to testing for families, asymptomatic surveillance testing, and a telemedicine pilot program.
The Budget, Capital, and Personnel committee recently okayed the position description for the next County Administrator search and a salary increase to $160,000. Legislators will continue to discuss the search in upcoming meetings.