Employee benefits pose challenges to final budget
Department heads from nearly all of the various Leavenworth County agencies appeared before the Board of County Commissioners Monday to discuss two remaining items that still need to be factored into the budget for 2008 employee benefits and salary increases.
A 15 percent total increase in health insurance premiums proposed by Leawood-based insurance broker CBIZ in a July 31 meeting is straining an already-tight 2008 budget and has many county employees asking how much their benefits package is actually benefiting them.
"Several years ago, Leavenworth County was a good place to come to work," Information Systems employee Tracy Dugger said. "You could take a little bit of a pay cut because of the great benefits."
If CBIZ's proposal is voted in, individual and family premiums under the core plan would jump to $452.54 and $959.39, respectively, per month in 2008 as opposed to $393.50 and $834.22 currently.
Premiums for the lower deductible buy-up plan would become $513.85 for an individual plan and $1,089.38 for a family plan compared to $446.81 and $947.25 in 2007.
County Commissioners assured employees that the board would continue to bear the costs of individual plans, which are currently utilized by 250 employees. But said for the 56 others wanting coverage for their spouse or children, the difference must still be paid out-of-pocket.
Under the core plan, that's about $6,100 annually compared to $5,300 in 2007.
Director of Juvenile Services Bob Doyle said that the increase would have a substantial impact on some of his department's employees that opt for family coverage.
"Their biggest concern is always the insurance," Doyle said. "15 percent scares a lot of people:it is going to become a hardship for some of my folks."
Commission Chairman J.C. Tellefson said he shared county employees' and taxpayers' frustration at the "horrendously expensive" cost of healthcare.
"I don't want to be here another year like this," he said.
Because of time constraints, though, the commission may be forced to accept the unpopular proposal from CBIZ like it or not.
Human Resources Director Diane Collins emphasized that a decision would need to be made by Thursday to meet budgetary deadlines.
"At this point we (don't have a choice)," Commissioner Clyde Graeber said. "They (CBIZ) have delivered us a very late product."
The board did not seek bids for an alternative insurance or healthcare provider this year, but Tellefson said, "We need to find an insurance company that meets everyone's needs that's willing to do business with us."
He proposed establishing a committee of employees who are particularly interested in the issue to explore ways of making healthcare more affordable to everyone.
Suggestions for the committee mentioned Monday included looking into a different provider altogether, creating an incentive program for healthy employees and allowing employees to trade in sick days or vacation time in exchange for reduced premiums.
Commissioner Dean Oroke noted that at 108 hours each year, Leavenworth County employees accrue some of the most vacation and sick leave in the region.
According to him, the next highest figure in the Mid-America Regional Council's nine county region is 96 hours.
"When we talk about benefits, you have to look at the entire package, not just hospitalization," Oroke said.
Benefits offered to full-time county employees are health, dental, and life insurance, as well as overtime, sick leave, vacation time, a retirement package and a longevity awards program.
Combined, the county budgeted $4.7 million for employee benefits for 2007, but certified public accountant Steve Wagner, who advises the board on its budget, said a better estimate for the year is $4.4 million. The potential amount for 2008 taking the proposed increase for health insurance into account is $4.8 million.
County Clerk Linda Scheer said that "when it comes to health insurance and workman's comp, some of these numbers are just really good estimates," emphasizing that a substantial amount of unexpended funds are often carried over into the following year.
In addition to benefits, the board also discussed what to do with salary increases for county employees.
Currently, department heads evaluate their employees and, based on those evaluations and cost-of-living expenses, it is decided how much a person's salary is raised.
To cut costs, Tellefson proposed limiting a department's meritorious pay increases to 20 percent rounded up to the nearest whole number.
"In the eight months I've been here, the thing I've found most disappointing, personally, is evaluations," he said, pointing to the fact that certain department heads have tried to give all of their employees the highest evaluation without providing adequate reasoning behind their rating.
Oroke questioned whether the action would favor smaller departments composed of two or three employees and suggested setting aside a pool of funds for each department head to distribute.
Wagner said there was $350,000 available for salary increases Monday, with Tellefson expressing interest in setting aside as much as half a mill, or $279,547 more.
In a July 25 meeting, Wagner said a 3 percent across-the-board increase would equate to $453,000.
For now, an official budget has yet to be set for 2008, although the board came closer to settling into more firm figures Wednesday after further meetings with department heads.
As of July 25, Tellefson's latest estimate for the county's total expenditures stood at $39.9 million, accounting for all reimbursements and appropriations, for a $3.2 million hike over 2007.
In mid-July, the chairman said property taxes could rise by as much as 6 mills, but after trimming more than $4 million out of budget proposals, Tellefson said Monday that a one-half mill increase would be more likely.
A mill is equivalent to $1 in taxes for every $1,000 in assessed valuation.