For the fifth consecutive year, County Executive Robert P. Astorino has proposed a budget that delivers essential services without raising the tax levy. Astorino’s $1.76 billion proposed budget for 2015 keeps spending below the rate of inflation, maintains staffing, and holds the line on taxes in part through $5 million in savings realized from having seven of the county’s eight unions contribute to their health care for the first time.
“This is a disciplined budget that strikes a smart and fair balance between the demand for county services and our ability to pay for them,” said Astorino. “There are elements of this budget that continue to place huge burdens on county taxpayers, such as nine unfunded state mandates that add up to 83 cents of every dollar raised by county property taxes. But with a sharp eye on ensuring that every dollar budgeted delivers value, our departments have put forth spending plans that are both cost effective and responsive to the needs of all of our residents.”
Spending
Under the proposed spending plan, the current $1.74 billion budget will increase by $21 million or 1 %, which is less than the rate of inflation, as measured by the Consumer Price Index. Spending in Astorino’s proposed 2015 budget is 3.25% lower than the budget he inherited when he came into office in 2010.
There are no operational reductions in the proposed budget, with headcount and spending across departments essentially flat. Savings are being realized by reducing job vacancies – positions that were funded last year, but not filled – tighter cost controls aimed at reducing overtime, and filling retirements with new workers who tend to be less expensive. For example, new staffing assignments in Public Safety are expected to reduce overtime by about $1 million, and the county saves $62,000 each time it replaces a retiring Correction officer with 20 years of experience with a new hire. In 2015, more than 200 Correction officers will be eligible to retire.
One departmental consolidation, which has the support of both the County Clerk’s Office and the Department of Consumer Protection, is being proposed. By moving the group that licenses plumbers and electricians from the Clerk’s Office to Consumer Protection, personnel costs can be reduced by about $150,000 the first year and $225,000 in the second.
Revenues
The largest source of revenue – about 32% of the budget – will come from the county tax levy, which will remain at $548 million. In 2011, Astorino reduced the county tax levy by 2% from $561 million, and it has remained at $548 million since then. Even though the levy is remaining flat, the actual amount of tax paid by property owners can vary based on the different assessment practices used by the municipality where the property is located. County taxes typically account for about 15% of a property owner’s bill, with schools amounting to 65% and municipalities, including special districts, making up the remaining 20%.
Sales tax revenue is projected to increase by 4% to $414 million. The sales tax projection assumes economic growth similar to this year. In contrast, mortgage tax revenue has fallen steadily this year. Mortgage tax is projected at $16 million in 2015, down $4 million from 2014. The decrease reflects a flat real estate market and more cash transactions.
State and federal aid, which together account for 25% of total revenues, are forecast to be flat in the coming year. State aid is projected to be $251 million, up $1 million, and federal aid is at $206 million, down $1 million.
The bulk of the remaining revenue comes from fees paid to the county, which are projected to be flat in 2015 coming at about $150 million.
The 2015 budget continues the Astorino policy of only using the unrestricted general fund balance, more commonly referred to as the “rainy day” fund, for its intended purpose of acting as a reserve in the event of operational or fiscal emergencies. In the past, the fund had become a target when money was needed to balance the budget. Astorino has made it a priority to keep the fund at levels that preserve Westchester’s good credit rating – the highest of any county in the state. The 2015 budget projects $142 million for the fund, which is 8.1% of the total 2015 budget, the same as 2014.
“As in year’s past, this budget establishes two goalposts – no tax levy increase and no raiding of the rainy day reserves,” said Astorino. “By working within this framework, we have been able to get the most out of every dollar in our budget for our residents, especially those most in need, and still maintain our principle of protecting the county’s taxpayers and financial integrity.”
Safety Net
The county’s safety net remains strong in 2015. Direct payments to our neediest residents are going up $3 million in 2015 from $435 million to $438 million. Management efficiencies have made this increase possible. The total Department of Social Services budget is up $1 million to $553 million. Administrative costs have been reduced by $2 million with the savings used to increase direct aid.
Changes to subsidized day care are also producing benefits. For the third year in row, the parent share will remain at 27%. Funding at this level has allowed the county to expand the program to more families. Through September of this year, the program served 3,067 children, up from 2,847 in 2013. In 2015, the program has capacity for 3,283 kids, a 15% increase since 2013.
The parent share is based on a family’s income above the poverty line, not the cost of the day care. Parents pay a share equal to 27% of the amount of their income above the poverty line. Westchester’s parent share is lower than many other counties and New York City. The average fee for families in the program is $6 a day, based on a five-day week. Parents only pay for the first child; any other children are free. The total cost of the program is $33 million and works out to a subsidy of about $10,000 a child. In comparison, in-state tuition at SUNY Purchase is $6,000.
Headcount
The proposed headcount in the 2015 budget is 4,859 positions, essentially flat to this year. This figure anticipates the elimination of one currently filled position in the Clerk’s Office, as the trades licensing group is being consolidated and moved from the Clerk’s Office into Consumer Protection. The budget will also eliminate 20 unfilled vacant positions.
Employee compensation continues to be one of the county’s biggest costs. The average salary of a county worker in 2013 was $77,000. A private sector employee working in Westchester makes an average salary of $65,000, according to the most recent figures from the state Department of Labor. When fringe benefits are added, compensation for the average county worker jumps to $121,000.
One counterweight to spiraling personnel costs has been employee contributions to healthcare. Working with the county’s labor unions, Astorino has negotiated labor contracts where seven of the county’s eight unions are now contributing to their health care. The employee contributions offset the county’s $103 million in health care costs by about $5 million a year. The Civil Service Employees Association (CSEA) is the only union that refuses to make health care contributions, despite a fact finder’s contract recommendation, sought by the union and accepted by Astorino, calling for employee health care contributions.
Unfunded State Mandates
Nine unfunded state mandates, totaling $454 million, will consume 83% of the county’s tax levy in 2015. The largest is Medicaid, the federal and state program that provides medical care to the poor. In 2015, Westchester’s bill from New York State to pay for the program is projected at $212 million.
Pensions, projected to cost $91 million in 2015, are the second largest unfunded mandate charged to the county by the state. To offset the cost, the 2015 proposed budget anticipates the county’s participation in the state’s pension amortization program, which allows the county to defer some payments and pay its pension bill over time.
For 2015, the budget calls for the county to pay $76 million of the $91 million pension expense up front and defer $15 million. This is the county’s smallest deferral since it entered the program in 2012, when pension payments climbed above $70 million a year and skyrocketed to $101 million in 2013.
The proposed budget also calls for borrowing $8 million to pay for anticipated tax certioraris, the claims made against the county by property owners challenging the assessments on which their tax bills are based. Because of the county’s very good credit rating, the borrowing cost will only be about $35,000 a year over five years.
“In a perfect world, the county would never borrow and pay all its bills in cash,” Astorino said. “But in the real world, you are faced with tough decisions. A $100 million pension bill translates to a 20 percent tax increase or 1,000 layoffs. Neither of those choices is realistic or even possible, so you work with your least worst options like borrowing. And, thanks to the county’s strong credit rating, we’re able to keep the government running and interests costs to a minimum.”
Other Highlights
- Westchester Community College: The county’s contribution to the school is increasing by $500,000, while tuition has remained flat for the second school year in a row.
- Transportation: Additional service has been added to routes serving Ridge Hill, Empire City Casino, and Sunday service in Yonkers has also been enhanced. The budget reflects an $8 million increase to pay for the state and federal mandates in the county’s new contract with Bee-Line bus operator, Liberty Lines. The MTA has proposed a fare increase, which if it goes into effect would be applied to the Bee-Line buses.
- Health: $50,000 has been added to cover Ebola-related costs, such as additional supplies and a contract with Empress ambulance to transport patients with the disease.
- Playland: The amusement park will be open for the 2015 season. A report on improving current operations and outlining future opportunities at the park will be presented to the County Executive by the end of the year. In October, the Ice Casino reopened after being closed by damage from Superstorm Sandy under the new management of American Skating Entertainment Centers. The reopened Ice Casino includes $4.9 million in renovations that preserve the building’s historic Art Deco architecture. American Skating is investing at least an additional $640,000 to upgrade the interior of the building.
- Parks: Park passes and parking fees are going up nominally. Golf fees are increasing by $1 at all county courses, except Hudson Hills, which has its own schedule.
- Miscellaneous Budget: Arts Westchester, Hudson River Museum, Invest in Kids, Legal Services of Hudson Valley, and various other community-based organizations will see their contributions from the County Executive increase by 3%.
