TO: Genesee County Legislators, Fellow Employees and Geneseeans
FROM: L. Matthew Landers, County Manager/Budget Officer
DATE: October 21, 2024
SUBJECT: Genesee County Proposed 2025 Budget
As Genesee County Manager, I am pleased to present the 2025 recommended budget for the Genesee County Legislature to consider. This budget funds County government in an efficient and responsible manner while making key investments which are necessary to continue delivering quality service to the residents of Genesee County. The recommended budget stays under the NYS tax cap, while covering a lengthy number of expensive State mandates of which the County has little to no control. Crafting a balanced 2025 recommended budget presented considerable challenges, particularly in addressing a $1.3 million deficit that emerged after receiving budget requests from all Department Heads. This deficit was eliminated through the hard work of the Manager’s Office, Treasurer’s Office and Human Resource Department personnel coming together to help me deliver my fifth recommended budget as County Manager. These departments were instrumental in assisting me with presenting a budget that stays well under the tax cap while meeting the needs of the residents of Genesee County.
The last few budgets have had a consistent theme focused on the need for and construction of a new County Jail and the County’s race to ensure the supply of public water stays ahead of the increasing demands being placed on the County-wide water system. In order to address these significant challenges the County embarked on two of the largest capital infrastructure projects in its history with a new County jail carrying a price tag of approximately $70 million and phase three of the County wide water system with a current projected price tag of $150 million. The first of these capital projects, the new County Jail, was completed this year and as of this budget message had two of the four pods open and operating with inmates from the former County Jail, and plans for bringing female inmates in-house by the end of the year. However, even with the new County Jail open and operational, the continued budgetary pressures from this project continue to present challenges for the 2025 budget. Preliminary staffing analyses developed in the design stage proved to be too low and as a result the 2025 budget calls for the creation of an additional ten full time Correctional Officer positions in order to safely run the new facility. It is still to be determined if additional staff will be needed to maintain the new jail and will become evident over the course of the next year after the Jail opens its third pod.
The County wide water system is still progressing forward and will continue to be a significant budgetary item for many years to come. The goal has been, and continues to be, to have “water pay for water.” Up to this point there has not been a need to transfer additional general fund monies into the water fund. However, it is naïve to believe a $150 million project can be covered solely by water users. The County continues to explore and seek outside funding opportunities and lobby Federal and State representatives for assistance. These two projects are going to weigh heavily on decisions made by the Manager’s Office and County Legislature for the foreseeable future, and is evident in the 2025 recommended County budget.
To meet the challenge of keeping the net County support impact in line with the 2025 budget, County departments were encouraged to think innovatively and find cost-effective solutions. This was a challenge considering New York State Retirement rate increases, health insurance increases along with higher than normal inflation and supply chain issues causing vendor contracts to increase. Despite these increases, I was pleased to see the majority of departments hold the line on spending, which helped greatly in delivering a budget that stays well under the tax cap. Genesee County is raising the levy 36% or $512,143 lower than the allowable New York State levy increase.
Budget Highlights
The 2025 recommended All Funds budget for Genesee County totals $189,249,435, which is $6,264,607 more than the 2024 adopted All Funds budget. The 2025 recommended General Fund (operating) budget is $144,288,857, which is $5,771,417 more than the 2024 adopted General Fund budget. Major increases impacting the All Funds budget include approximately $1.6 million in medical and pharmacy cost increases to the County’s self-insurance plan, ten new hires related to the new County Jail costing approximately $1 million, NYS Retirement cost increases of approximately $1.5 million and Preschool Supportive Health Services Program cost increases of $1.9 million.
I am proposing a property tax levy of $33,630,739, which is an increase of $908,362 or 2.78%. For the median residential household in Genesee County with an assessed value of $161,000 this amounts to $32.91 of property taxes. The average County property tax rate in Genesee County would go down from $8.08 to $7.57 or 6.33% in the recommended budget. For the median residential household in Genesee County assessed at $161,000, that did not have an assessment change from 2024, this will result in a net tax decrease of $82.11.
The recommended budget includes $2,500,000 of unappropriated fund balance, an increase of $1,000,000 from the 2024 adopted County budget.
The 2025 recommended budget includes a continued commitment in increased funding for our roads and bridges infrastructure annually by $1 million. Past deferred maintenance on the County’s infrastructure has put the County in catch-up mode and the cracks are showing. This continued commitment of an extra $1 million is a big step in addressing the deferred maintenance of the County road and bridge infrastructure.
The County continues to make strategic investments in its workforce, which will result in better service delivery to Genesee County residents. A large share of the investments in the 2025 recommended budget are being made in public safety. Newly created positions are necessary to run an effective 21st century correctional facility and include creating ten new Correction Officer positions. Two additional part time positions are being created in the Sheriff’s Office to address the increased demands of meeting the new requirements under the Discovery reforms and to address a backlog in the Civil division.
The 2025 recommended budget continues funding for two recently enacted contracts with local ambulance providers for over $600,000 annually to help stabilize emergency response resources in Genesee County. This action was listed as one of the recommendations from a recent County funded study that examined fire and ambulance service in Genesee County. These contracts strengthen the capabilities of local providers, improve emergency response times for County residents and allow the County to avoid directly purchasing ambulances and hiring staff.
Budget Challenges
While there were familiar challenges in this budget such as rising wages, health care and retirement costs, and costly state mandates, two major issues looming for the 2025 and future budgets are the new Genesee County jail and the challenge for Genesee County to keep water supply ahead of demand through the construction of phase three of the County wide water system:
- NYS Retirement Cost Increases – These costs have risen significantly, with an average increase over all tiers exceeding 25%, resulting in a $1,500,000 overall increase in the 2025 budget.
- Health Insurance Cost Increases – After being able to hold the line the past couple of years it was abundantly clear that a premium increase was not avoidable for the 2025 County budget. Healthcare premiums are increasing by 8% in 2025, costing the County approximately $700,000.
- Wage Increases – Rising wages in every sector has made recruiting and retaining qualified and capable County employees more challenging. Recently enacted bargaining agreements with the County’s labor unions have well deserved increases for 2025. These increases help to address the need for the County to pay competitive wages to retain and attract quality employees, however this comes at a cost that has to be weighed against providing a quality service at an affordable cost to the public.
- Mandates – Approximately 95% of the 2025 recommended property tax levy is made up of State mandated expenditures to fund departments and programs such as Medicaid, Probation, the Jail, Public Defender’s Office, Assigned Counsel, Social Service programs, Mental Health, Early Intervention, 3-5 Preschool services, and various others.
- Decreasing Sales Tax Revenue – After three years of increasing sales tax revenues the County is facing decreasing revenues in 2024, which doesn’t allow for an increase in the 2025 recommended budget.
- New Genesee County Jail – The opening of the long overdue new Genesee County Jail took place this past spring, and with it brings one of the largest capital projects in County history. With a projected all-in price tag of approximately $70 million, the debt service payments are approximately $3.5 million annually. In addition to the debt service, the 2025 operational increase to the Jail has been budgeted at approximately $1.5 million. For 2025, there is the hiring of ten new corrections officers, which are large contributors to the $1.5 million increase.
- Genesee County Water System, Phase 2, 3 & 4 – Genesee County is nearing completion of the $25+ million phase 2 of the County-wide water system, and is quickly designing the $150 million phase 3 which should hopefully break ground in the next few years. Phase 3 includes bringing in enough water from Monroe County to close the City of Batavia water plant, which draws from a threatened source and has long outlived its useful life. However, before the plant comes offline, millions more have to be invested to ensure water supply keeps up with demand until phase 3 is complete.
County Responses to Budget Challenges
The New York State Tax Cap penalizes Counties for enacting an override resulting in limited options for meeting budget challenges. Genesee County has a long history of doing more with less, sharing wherever possible, privatizing operations, deferring needed capital improvements, modestly compensating employees, and providing virtually no post-employment benefits to staff. After years of cutting to the bone the following actions and revenue sources were available to close the gap for the 2025 recommended budget:
- Fund Balance Utilization – The 2025 recommended budget utilizes $2,500,000 of fund balance.
- Reserve Utilization – The 2025 recommended budget utilizes over $600,000 from reserves established specifically to soften large increases in the Medical Fund.
- Raising the Tax Levy – The 2025 recommended budget raises the levy 2.77% in 2024, which continues Genesee County’s continued adherence to the New York State property tax cap.
- Budgeting Increased Interest Earnings – Recent increases in interest rates coupled with a stabilized Fund Balance and utilization of outside investment consultants have allowed the County to budget for an additional $563,000 in interest earnings in the 2025 recommended budget.
- Line by Line Review with New Perspective – For the fourth year in a row I was accompanied by the Deputy County Manager and Executive Assistant in every budget meeting, a process that initiated new ideas and resulted in savings in several departmental budgets. A deeper dive into individual budget lines resulted in significant budgetary savings when aggregated. We were also able to utilize greater sharing of resources between departments to capture more state aid and reduce the net county share in several cases.
In Closing
While I am pleased to present a budget that stays within the confines of the New York State Tax Cap and effectively lowers the property tax rate by $.51/1,000, I am not blind to the significant impact the proposed tax levy has on the citizens and businesses of Genesee County. My commitment as County Manager is to work closely with local governments, community not-for-profits, businesses and citizens to ensure the prudent use of these resources.
Special thanks are extended to Vicky Muckle, Tammi Ferringer and Kevin Andrews for their assistance with helping me prepare this year’s budget. While all three provided many hours of counsel, expertise and debate, Vicky ensured countless budget revisions were accurate and timely. As the seasoned veteran in the office, Vicky ensured I stayed on task in delivering this balanced budget. I also want to thank the Legislature and Chairwoman Stein for their valuable insight, guidance and feedback during this budget season.
The 2025 Genesee County budget is turned over to the Legislature for their consideration and eventual adoption. I look forward to further discussion with Legislators and citizens to ensure that the budget meets the needs of this community.
L. Matthew Landers