Not to bury the lead here -- but when we look at the totals for the budget and compare it to this past year's actuals:
Revenues are budgeted to DROP by 21.4%
Expenses are budgeted to INCREASE by 3.5%
So, before we dig into an exciting review of the various department budgets and all that's wrong with the RedTail budget -- let's look at the line items that cross departments and cross budgets. Basically, these are line items that typically come in as a single bill, but can be broken down so the departments all 'pay their fair share' when it comes to carrying the burden of the expense.
Think of it like this, you have a budget for your groceries, a budget for clothing, and a budget for household goods (like new towels). You go to Costco and you spend $450 (as one does at Costco) on groceries, some new jeans, those new towels, and maybe a set of tires. You can take your receipt and pick out each expense and calculate how much of each of those you spent --- OR you can take the receipt and divide it up by percentages to make your life easier. Municipal government does the latter -- especially when the bills are harder to break apart by the true spending, like say our legal bills.
To make this part of the review easy and fair, I've looked at two categories of this type of spending and allocation -- Personnel costs and Office Expenses. For office expenses, I used a rough rule that said a line item had to be applied to at least 3 departments OR funds to qualify in this review. For Personnel, I could easily find all the costs associated with having employees and brought them together.
Personnel Costs:
I rolled the totals that are spend throughout the budget and actuals by their listed GL #'s to get a true since of what we are spending on the people of the village. Remember that one of the things that Past-President Serwatka kept pointing out was that we spent too much on the Village management. He even combined positions so the salary would be higher than before, but the net to the Village was lower. But that doesn't play out when you look at the actual numbers.
Personnel Costs as a % of our total expenses has grown almost 6% in the past 4 years (regardless of the classification of employee) -- without overtime.
You'll see that the budget for 20-21 has salaries growing $115K, but Part-Time Hourly and Seasonal dropped by a total of $235K --- Most of that actually appears to be because there is NO budgeting for RedTail employees beyond the manager, the golf pro, the maintenance man, and 3 part timers.
There have been 3 employees who have recently left the Village in the past few weeks, and several open positions -- and yet there is zero in our budget for recruitment. Curious?
If the CAO and President (and Trustee Ulrich based on the 5/4 video) get what they seem to want -- which seems to be to replace the existing staff -- there will be a need to recruit many more than just for the 3 open positions -- and we aren't getting some of those positions with free posts on Indeed.
FICA expense is a set percentage of total wages, historically, our village has spent 8.25% of total wages in FICA. For unknown reasons, this year's budget is at 7.12%?
Ok -- so salaries look odd to me -- but what about the other "spreadable" expenses?
Office Expenses:
I loosely called these 'office expenses' but these are expenses that affected multiple departments for essentially the same things. By rolling them up, you can see we pay nearly $20K a yes for telephone service and $120K for electricity. What you can also see is that as a % of the total expenses, these expenses have also grown over the past few years.
Office supplies are not centrally purchased. Every department buys their own from wherever they want. If we have a CAO who truly was watching the budget, she would have put into place central ordering to control costs and get bids from the top office supply companies for discounts.
Anyone know why the budget for the copier lease is tripling this coming year? Did we see bids on that?
Is the cost of electricity going down? If we spent $125K for it in 2019-2020; wouldn't we need to budget about the same for 2020-2021? I know that's the way I budget my utilities for me. But maybe I need to learn more about this projected decrease in electric costs?
Legal bills! Yes, my favorite. I will grant that when this budget was likely first put together, CAO Smith probably couldn't have imagined that we would have spent 1/3 of the prior year's legal bill in the month of May; but she didn't even budget for a three year average of expenses. My guess is that she believed the prior year's expense was higher due to the land sale; but with no notes, it's my guess alone.
There is a capital improvement line item for new computers (there's no money budgeted for it -- but the line item is there), which might explain the zero in the budget for computer equipment after $7,400 last year, but again -- no reasons are listed.
Look, budgeting is hard. I get that. It's not easy to try to predict the future and figure out what you might need or not need. But I'm not holding her accountable to the budget she wrote last year and didn't come close to -- I'm looking a historic spending and her projections for this coming year and wondering why we keep spending more and more.
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