9/29/2016
Lenawee County Highlights
State of the County in 2016
Overall County economics
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The overall unemployment rate in the County
stands at 4.3% compared to a state rate of 4.5%
and national at 4.9%
Real Estate transactions are increasing as is
construction
At their presentation last week, Lenawee Now
reported a number of expansions of existing
employers
One hurdle to increased employment is a
shortage of skilled workers
Impact on County Government
The overall improvement in the economy
has not necessarily created the same
improvement in county government
“economics”
 Flat revenues and increasing expenditures
are creating a slow moving crisis for
Lenawee County government

Financial
State of
the County
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9/29/2016
Finances - Revenue
Factors Impacting Revenue

The primary source of General Revenue
for the County is the Property Tax
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Change in Property Tax Base:
◦
◦
◦
◦
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2013
2014
2015
2016
3,163,516,270
3,176,502,914
3,198,852,571
3,193,938,972
4/10th percent
7/10th percent
-1/10th percent
Three year change in tax base of
basically one percent.
Finances - Expenditures
During the Recession County employees
made benefit concessions and went four
years without change in pay
 Since 2014 the average pay increase has
been about 1%
 Pay for many positions in the County are
not competitive with surrounding
counties and other municipalities
 Average annual increase in the cost of
health ins has been about 7%.

Statutory limits on tax types and rates
 Constitutional limit on taxable value
 The loss in property tax revenue was
sudden, the increase has been nearly nonexistent
 Some revenue is tied to ability to pay
 Even as the economy has improved our
revenue has not increased
 Historically low interest and inflation
rates hold down tax and interest revenue
Finances - Expenditures
The required contribution to the
retirement system has been somewhat of
a rollercoaster as investments have been
volatile in the last few years
 The drain on the County from the airport
litigation has been protracted and
expensive
 Fully meeting mandated functions has also
added to expenses
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9/29/2016
Revenues – Filling the Gap

Finances
Some increase in State Revenue Sharing
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◦ 2012 Funding = $1,555,108
◦ 2016 Funding = $2,034,689
◦ 2001 Funding = $1,914,813
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Increase in use of Delq Tax Rev Fund
◦ Beginning in 2014 the use of Delq Tax revenue
for operational purposes
◦ $1,000,000 in 2015
◦ $1,500,000 in 2016
Status of Reserve Funds
General Fund
2009 net loss
2010 net loss
2011 net gain
2012 net loss
2013 net loss
2014 net gain
2015 net gain
($1,446,748)
($1,870,503)
$ 287,642
($ 242,000)
($ 810,238)
$ 262,600
$ 381,801
Where is the “crisis”?
Delq Tax Fund Combined Balance
2011
6,135,310
24,411,286
30,546,596
2012
5,892,635
23,342,519
29,235,154
2013
5,082,397
24,970,426
30,052,823
2014
5,377,769
24,970,426
30,348,195
2015
5,759,570
24,513,544
30,273,114
Net change over five years
Expenditures have been adjusted to
match revenues. Net to reserve in last 5
budget years = -$120,195
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Planning for capital needs since 2011
◦ Amounts budgeted for Capital Expenditures
2014
600,000
2015
666,325
2016
774,082
2017
800,000
The increased amounts do not meet all
requests on an annual basis
-1%
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9/29/2016
Where is the “crisis”?
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The Capital Improvement Plan does not
include rebuilds for:
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Sheriff Department - $6,500,000
Annex
$ 800,000
Campus
$ ???
Judicial Bldg Security $ ???
Some of these needs are immediate
Where is the “crisis”?
County is less and less competitive
 We are not competitive with
communities that are within commuting
distance
 We have lost employees to neighboring
counties
 We have had difficulty filling some
technical positions
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What does our future look like?
What does our future look like?
There are expenditures that we will have
to make
 The Sheriff’s Department must have
modern facilities
 We will not retain valuable employees
without competitive compensation
 If we do not invest in maintenance for our
facilities, we will spend much more
replace those same buildings
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Employer’s and workers are looking for
certain services to locate and live in a
community
 Our children and grandchildren have
expectations of what a 21st century
community looks like
 If we want this county to grow and be
competitive we will need to invest in our
future
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9/29/2016
Next Steps
The Board of Commissioners have
contracted with Grassroots Consulting to
explore possible sources of additional
revenue
 A subcommittee has been appointed to
work with Grassroots
 The subcommittee will be reaching out to
the community in the near future for
advice and assistance

Next Steps
The objective is to identify the type and
scope of County government for the
future
 To match our revenues and expenditures
so that we can provide a workforce and
facilities in line with the wishes of the
community
 To reach the objective with the
cooperation and participation of a broad
range of county residents

questions
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