Cook County 2013 Budget Departmental Reviews, October 22, 2012

October 22, 2012  Bureau of Finance
(CFO, Revenue, Risk Management, Budget and Management, Comptroller)

Commissioners Absent:  Butler, Goslin, Reyes, Murphy, Tobolski

CFO Tariq Malhance presented the balanced budget which had its audits done on time, is paying down the debt, is increasing efficiencies through collaboration with Chicago, and has shown savings in employee health care costs of 1/2 million per month.  This and other practices earned them AAA bond rating allowing lower interest rates for borrowing.

 Highlights of the budget is that it is down 2% from last year and has a revenue shortfall of $267.5 million  (Expenditures-Revenue=Shortfall).  The shortfall has been less each year of the last 3 years.  This gap is closed by eliminating 462 positions, most of which are vacant anyway; employee health care savings; and a hoped-for waiver of $99 million from the state to add non-paying residents to the Medicaid rolls.

Also some additional new taxes are proposed:  an additional $1.00 per pack of cigarettes ($25.6 million); a non-titled use tax for purchases made outside of Cook County by businesses, contractors and residents of Cook County ($15 million); tax on bullets & guns ($1million); gambling machine tax of $800 per machine ($1.3 million).

Special Purpose Funds are down 13.9%,  from $156,221,000 last year to $117,220,000 in the new budget.  Full Time Equivalent employee count is down about 400 positions to 21,526 employees for the next fiscal year.  New hires in Finance Department are 48 employees.  Some new hires will work on Technology and Capital Projects.  Others will be in area of tobacco tax enforcement.

There was a long discussion about the approach to revamping technology for the county.  Twelve new hires will need to start on preparing the scope of new systems. There were questions on why hiring of these important, high-level positions takes so long.  It appears that the Compliance Monitor  (and the inspector general and the plaintiffs) of the Shakman decree are taking up to 6 months to  decide whether a position is Shakman exempt.   These decisions are being negotiated among the parties involved.  Also not enough resumes of qualified people are coming in, probably because of the lower pay compared to private business. It was suggested that perhaps a headhunter could be hired to more efficiently find these needed employees.

Risk management, which deals with employee benefits, liability, safety and workers compensation, has also produced some savings in the new budget.   They have 22 employees with some of the newer hires dealing with disability leave checks.  There have been savings in employee and detainee medical rates. Seventy percent of employees are now in an HMO plan and detainees in the jails have a reduced Medicaid rate.  There has been a $293 million reduction in fringe benefit expenditures.  There will be exploration in encouraging employees to use the Cook County Health and Hospital System (Stroger Hospital).  There was also discussion on reducing the backlog of workers compensation cases by allowing cases under $25,000 to be more quickly processed and spending more resources and time on bigger claims.  There has been an increase of about $2 million per year due to the Affordable Care Act mandate to include children up to age 26 on parent's insurance.  The benefits package in the county (especially insurance) is considered very generous.

Budget and Management director Andrea Gibson stated that STAR management reports are considered in budgeting for the various elected officials and departments .  There will be a growing gap of the budget deficit due to increased wages/benefits, lack of  fees in the Health and Hospital System, and debt payments in years 2015-2017.