HomeMy WebLinkAbout54-1014-24R STATE OF WASHINGTON
County of Jefferson
In the Matter of Establishing Methods and
Procedures to be Employed During RESOLUTION NO. 54-1014-2 4 R
Recessions and other Periods of Severe
Financial Stress
WHEREAS, Jefferson County relies on revenues from a variety of sources to fund its
services and functions; and
WHEREAS, the County's current financial situation is strong with healthy reserves and
sustaining revenue streams, which has yielded a number of significant benefits:
a. Parity in Employee Pay. The County has been able to substantially improve employee
compensation which has helped attract and retain excellent employees. This has also
resulted in improved employee morale and engagement.
b. Additional & Necessary Staff. The County has been able to add additional staff for a
number of key critical functions including fire marshal, expanded IT team, expanded HR
team and public information team, and an additional civil deputy prosecuting attorney to
name a few.
c. Capital Projects. Capital projects including, but not limited to, software system upgrades
or replacement, records relocation, and electric vehicles.
These actions have increased the County's expenses significantly but revenues have kept pace;
and
WHEREAS,many of the county's revenue sources are vulnerable to economic downturns
in general or other circumstances in particular that could result in severe revenue decreases; and
WHEREAS,prudent financial management requires that county leadership anticipate and
plan for events such as these; and
WHEREAS, the County Administrator monitors a variety of national, regional and local
financial indicators such as the Conference Board's Leading and Coincident Economic Indicators
among others to help anticipate and plan for the events: and
WHEREAS, a variety of management actions exist to align county expenditures with
county revenues to ensure that financial reserves are maintained at acceptable levels-at least 15%
of the General Fund expenditure budget; and
WHEREAS, describing these management actions in advance of these potentially adverse
conditions will better prepare the Board of County Commissioners, other elected officials, and
department directors to implement these management actions should the need arise; and
WHEREAS, best practices and prudent management require that local government think
about these possibilities in advance and plan for them; and
WHEREAS,if the County should enter into a recession,sales tax and other revenues could
be reduced,which would trigger actions and processes that are described in Sections 4 and 5 below;
and
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WHEREAS, other public agencies (including our neighboring county) have been taking
action to implement some of the processes that are listed in Sections 4 and 5 below; and
WHEREAS, our employees have a right to know that these management actions could be
implemented which might adversely affect their conditions of employment with the County;
NOW, THEREFORE, THE BOARD OF COUNTY COMMISSIONERS OF
JEFFERSON COUNTY,WASHINGTON, HEREBY RESOLVE AS FOLLOWS:
Section 1. Establishing Methods and Procedures to be Employed During Recessions and other
Periods of Severe Financial Stress. The Board of Commissioners of Jefferson County does hereby
establish the following methods and procedures as outlined in Sections 4 and 5 below ensure the
financial stability of the County during times of financial stress, which may be employed
separately or in combination, in any order depending on the severity and expected duration of the
financial stress.
Section 2: Whereas Clauses Adopted as Facts. The Jefferson County Board of Commissioners
hereby adopts the above "Whereas"clauses as Findings of Fact.
Section 3. Purpose. The purpose of this resolution is to identify methods and procedures for
dealing with reductions in revenue that could endanger the financial health of the County.
Section 4.Methods and Definitions related to Managing Government During Recessions and other
Periods of Severe Financial Stress (these are in no particular order):
a. Work hour reduction. Workday or work week reduction of some size to achieve savings in
salaries and benefits, in accordance with current collective bargaining agreements.
b. Furlough. Period(s) of some duration in which employees are not to report for work to
achieve savings in salaries and benefits, in accordance with current collective bargaining
agreement.
c. Hiring freeze. A moratorium in filling vacant positions to achieve savings in salaries and
benefits.
d. General Fund Operating Transfer Reduction. Reduce support to other funds enacted
through an emergency supplemental appropriation to reduce General Fund expenditures.
e. Discretionary spending cuts or freeze. Discretionary spending on operating expenditures,
i.e.,training, travel, subscriptions, etc.
f. Reduce or eliminate services. Low priority,non-mandatory services.
g. Contract renegotiation. Support to organizations the County offers financially through
memoranda of agreement/understanding, grant agreements and other agreements.
h. Contract cancellation. Cancel County contracts with organizations where the financial
support is contingent of funding being available.
i. Reduction in Force. Laying off employees to achieve savings in salaries and benefits, in
accordance with current collective bargaining agreements.
Section 5. Procedures for Managing Government During Recessions and other Periods of Severe
Financial Stress:
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a. Financial forecasting. County core fmancial staff (County Administrator, Finance
Manager, Treasurer, Auditor, HR Director) and the Budget Committee meet monthly to
review financial performance and observe trends. The performance of significant revenue
streams and related expenditures can be evaluated to determine whether any of the methods
in Section II should be considered or activated.
b. Sizing the problem. Core financial staff will evaluate emerging financial stress situations
to consider whether action must be taken,the action to take and when.
c. Proposing a strategy. Core financial staff will develop a financial plan to be briefed to the
Budget Committee for consideration and discussion.
d. Work with stakeholders (Electeds and Directors). Core financial staff will work with
stakeholders to refine the financial plan.
e. Approval by the Board of Commissioners. Core financial staff will present the financial
plan to the Board of Commissioners for approval.
f. Financial Plan implementation. County staff will implement the actions in the plan
approved by the Board of Commissioners.
g. Financial Plan monitoring. Core financial staff will monitor the results of the financial
plan and will report results to the Budget Committee and to the Board of Commissioners.
h. Adjusting the plan. Core financial staff will propose changes to the financial plan based on
results and the changing financial situation.
Section 4. Severability. If any section, subsection, sentence, clause, phrase or section of this
Resolution or its application to any person or circumstance is held invalid, the remainder of this
Resolution or its application to other persons or circumstances shall be fully valid and shall not be
affected.
Section 5. SEPA Categorical Exemption. This Resolution is categorically exempt from the State
Environmental Policy Act under WAC 197-11-800(19).
Section 6. Effective Date. This Resolution shall take effect and be in full force immediately upon
passage by the Board of County Commissioners.
(SIGNATURES FOLLOW ON THE NEXT PAGE)
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ADOPTED and APPROVED this / ' day of October, 2024.
SEAL: JEFFERSON COUNTY BOARD OF
CO COMMISSIONERS
„Ne»"' Kate Dean,4,air
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A • T: APPROV AS 0 FORM:
a i 11 ,0 _ '%y 21 a C October 15, 2024
C:,of Gallaway, C Date Philip C. Hunsucker, Date
Chief Civil Deputy Prosecuting Attorney
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JEFFERSON COUNTY
BOARD OF COUNTY COMMISSIONERS
REGULAR AGENDA REQUEST
TO: Board of County Commissioners
FROM: Mark McCauley,County Administrator
DATE: October 14,2024
SUBJECT: Resolution,re: In the Matter of Establishing Methods and Procedures to be
Employed During Recessions and Other Periods of Severe Financial Stress
STATEMENT OF ISSUE:
After a number of years with robust General Funds revenue streams the County must plan for some of those
streams to shrink. Two revenue streams already shrinking are investment income and DNR timber revenues.
The reduction could be $500,000 or more in 2025. Another significant revenue that could be reduced is sales
tax should the economy slow or enter into recession. The Conference Board's Leading Economic Indicator
is signaling that we are in recession currently or are heading in that direction.
In addition to declining revenues the County is faced with significantly higher costs due to the 20%plus
inflation we've experienced since 2021.
ANALYSIS:
The combination of these circumstances and fiscal prudence requires that the County be prepared to react in
order to maintain fiscal stability. To that end the attached resolution establishing methods and procedures to
be employed during periods of severe financial stress has been prepared for Board consideration.
The proposed resolution has been shared with the County's other elected officials and with our department
directors. It was drafted with the assistance of Finance Manager Judy Shepherd, Treasurer Stacie Prada,
Auditor Brenda Huntingford, Human Resources Director Sarah Melancon and the Prosecuting Attorney's
Office.
FISCAL IMPACT:
This request has no fiscal impact.
RECOMMENDATION:
That the Board of Commissioners approve and adopt the attached resolution.
REVIEWED BY:
//St
Mark McCauley, unty Administrator ate