FY 2018 TENTATIVE BUDGET PRESENTATION FINAL COUNTY.PDF

MARICOPA COUNTY
FY 2018
RECOMMENDED/
TENTATIVE BUDGET
May 22, 2017
Cynthia Goelz,
Budget Director
Brian Hushek,
Deputy Budget Director
Tina Allen,
Budget Administrator

Executive Summary
2

Budget Guidelines and Priorities
Adopted by the Board of Supervisors on January 4, 2017
• Develop a sustainable budget that advances the County’s
mission and strategic goals
• Property tax rate will remain flat
• Human Resources to develop a targeted employee
compensation strategy
• All departments must submit within their baseline
• Selected departments will complete a zero-based budget
• New capital or technology requests will be reviewed after
reserve decisions are made
• Increases will be evaluated for their impact on the County’s
Expenditure Limitation
3

Assumptions
• Structural balance in operating funds
– Recurring revenues meet or exceed recurring
expenditures over the economic cycle
• Most Likely scenario for major revenue streams
• Contingency based on historical utilization and
revenue risks
• General and Detention Fund reserve levels
based on two-months of prior year operating
budget
4

Zero-Based Budget
• Seven Departments submitted a Zero-Based
Budget:
– Air Quality
– Assistant County Manager (940)
– Assistant County Manager (950)
– Deputy County Manager (930)
– Equipment Services
– Planning & Development
– Transportation
5

Major Budget Challenges/Risks
• Develop a budget that supports exceptional customer
service with a lean and efficient government based on
service demands in the country’s fastest growing
County
• Slow Growth in Sales Taxes, Vehicle License Taxes,
Jail Taxes, and Limited Growth in Property Tax
Assessment
• Criminal Justice operating and CIP needs continue to
increase
• Detention Fund increasing dependency on the General
Fund
• Pension rates and unfunded liabilities
• Expenditure Limitation
6

Major Budget Challenges/Risks
• State shifts of over $22M represent 1.1% of the
operating budget:
– Juvenile Corrections Payment
– Department of Revenue Payment
– Diverted HURF Funds
– Judges salaries
– Other shifts
• An additional 12.8% ($245M) in other mandated
payments to the State:
– ALTCS
– AHCCCS
– Arnold v. Sarn and behavioral health services
for a combined total of almost 14%
7

FY 2018 Recommended Budget
Sources of Funds: $2,494,333,805
Miscellaneous & Highway User
Interest Revenues
Jail Excise Tax 5.48% 4.49%
State Shared 6.34% Property Taxes,
Vehicle License Penalties and
Taxes Interest
6.73% 21.59%
Other
Intergovernmental
& Grants
8.46%
Permits, Patient
Revenue, Fees
Fines & Charges
10.90%
State Shared Sales
Tax
21.41%
Fund Balances
14.60%
8

FY 2018 Recommended Budget
Uses of Funds: $2,494,333,805
Health, Welfare and
Other*, Sanitation,
$359,009,040, $530,852,278,
14.39% 21.28%
Education,
$39,573,978,
1.59%
Culture and
Recreation,
$21,157,291,
0.85%
Highway and
Streets,
$210,160,941,
8.43% Public Safety,
$1,333,580,277,
53.46%
*Other = Assessor, Recorder, Elections, Treasurer, Internal Audit, County Manager, Assistant County
Managers, Board of Supervisors, Clerk of the Board, Finance, Budget, Procurement, Human
Resources, Risk Management, Real Estate, Equipment Services, Facilities Management, Benefits, 9
Enterprise Technology, Non Departmental

FY 2018 Net Variance to the
FY 2017 Revised Budget
(Millions)
FY 2017 FY 2018 Increase/ %
Revised Recomm (Decrease) Change
Total Operating $1,828.1 $1,907.2 $79.1 4.3%
Total Non Recurring 533.4 587.1 53.7 10.1%
Total County $2,361.5 $2,494.3 $132.8 5.6%
GF Operating $1,253.0 $1,308.9 $55.9 4.5%
GF Non Recurring 153.3 149.7 -3.6 -2.3%
Total General Fund $1,406.3 $1,458.6 $52.3 3.7%
10

State Budget Impacts
Estimated State Budget Impacts on Maricopa County, FY 2008 to FY 2018
FY 2008-FY FY 2016 FY 2017 FY 2018 TOTALS
2015
Mandated Contribution $ 103,668,300 $ - $ - $ - $ 103,668,300
Sweep ALTCS Refunds 11,078,831 - - - 11,078,831
HURF Diversion to DPS* 46,757,302 5,095,023 5,095,023 5,095,023 62,042,371
HURF Diversion to DPS - One-time Relief* - - (4,182,806) (4,182,806) (8,365,612)
HURF Diversion to MVD 6,662,102 - - - 6,662,102
Reduce, Eliminate Lottery Revenue** 1,498,632 249,772 249,772 249,772 2,247,948
SVP Payments 18,806,649 2,106,649 2,345,000 2,345,000 25,603,298
100% Superior Court Judges Salaries 45,206,074 9,354,345 9,470,246 9,470,246 73,500,911
Assessor - DOR** 1,128,000 282,000 282,000 282,000 1,974,000
Capital PCR - ongoing** 1,170,353 447,723 447,723 447,723 2,513,522
Capital PCR - start up 64,962 - - 64,962
Reduction in State-Shared Sales Tax for 1,000,000 1,000,000 1,000,000 1,000,000 4,000,000
Utilities used in Manufacturing**
Reduction in Jail Excise Tax for Utilities 600,000 600,000 600,000 600,000 2,400,000
used in Manufacturing**
Juvenile Corrections Cost Shift* - 7,166,033 6,724,128 6,724,128 20,614,289
Juvenile Corrections - One-time Relief * - - (4,777,300) (4,777,300) (9,554,600)
DOR Cost Shift - 4,030,498 3,982,970 3,982,970 11,996,437
Superior Court Judges and Justice of the - - 938,951 938,951 1,877,902
Peace Salary Increase***
Total $ 237,641,205 $ 30,332,043 $ 22,175,707 $ 22,175,707 $ 312,324,661
*Received relief in FY 2017 and FY 2018 of $4,777,300 for Juvenile Corrections and $4,182,806 for HURF Diversion to DPS,
but full year impact has been built into operating budget.
**Estimates based on initial year of shift without consideration of inflation. 11
***Annualized cost of full salary increase for Superior Court Judges, Commissioners and Justices of the Peace
in FY 2017 State Budget.

Maximum Levy vs. Actual Levy
General Fund
$775
$700 $684
$656
$628
$625
$606
$581
$550 $538 $558 FY 2018: $148.2 M $536
$518
Below Maximum Levy
$475 $492 $506
Maximum Levy Actual Levy $478 $471
Millions $443
$400 $425
$410
$325
$250
$175
$100
12

No Change to
Combined Tax Rate
Total Rate Total Rate
$1.6357 $1.6357
1.65
$0.0556 $0.0556
1.6
1.55 Library
1.5 $0.1792 $0.1792 Flood Control
1.45 County Primary
1.4
1.35 $1.4009 $1.4009
1.3
1.25
FY 2017 FY 2018
13

In FY 2017, County Primary Property Taxes
were only 10.9% of Total Property Taxes
14

Major Operating Revenues
$1,000
$800 $152 $157
$146
$146 $152 $158
$600
Millions
$400
$497 $516 $534
$200
$-
FY 2016 Actual FY 2017 Forecast FY 2018 Recomm
Sales Jail Tax VLT
15

Detention Fund Structural Balance
without General Fund Subsidy
$60
$49.3
$40 $39.4
$33.9 $32.6
$30.4 $28.7
$20
-$0.1
$0
-$3.7 -$9.8
Millions
-$20 -$17.7
-$30.3
-$40 -$39.5
-$49.6
-$60
FY FY FY FY FY FY FY FY FY FY FY FY FY
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017* 2018** 2019*** 2020***
*Forecast ** Recommended *** Projection
16

Sheriff’s Office
• The Detention Fund operating budget is recommended
at $221.6M and includes increases for:
– Retirement contributions of $2M
– Overtime and related costs of $2.5M
– Net changes to telecommunication, radio, risk
management, supplies and services of $400k
• One-time funding is recommended for:
– Tasers in the amount of $607,200
17

Sheriff’s Office
• The General Fund operating budget is recommended
at $103.5M and includes increases for:
– Retirement contributions of $3.3M
– Overtime and related costs of $1.3M
– Net changes to telecommunication, radio, risk
management, supplies and services of $400k
• One-time funding is recommended for:
– Tasers in the amount of $312,800
– Servers in the amount of $750,000
– Mobile Data Computers in the amount of $1,200,000
– Replacement Radios in the amount of $445,000
– IT Storage in the amount of $800,000
18

Judgment Order
• October 2013: Original Order stating requirements including Court
Appointed Monitor
• July 2016: Second Amended Judgment appointed an independent
investigator and independent disciplinary authority
• The MCSO General Fund Compliance operating budget is
recommended at $19.7M and includes:
– Increases for retirement contributions of $515K
– Increases for overtime and related costs of $174K
– Net changes to telecommunication, radio, risk management,
supplies, services and other changes of $602K
19

Judgment Order
Estimated Total for Compliance
$83.77M
(excluding legal costs)
$30
$26.54 $26.18
$25
$6.37 $6.46
$20 $17.79
$15.87
Millions $3.24
$15 $2.82 $11.43
$10 $2.82 $20.17 $19.72
$3.75 $13.05 $14.55
$5 $8.61
$0.75
$0 $3.00
FY 2014 Actual FY 2015 Actual FY 2016 Actual FY 2017 YTD* FY 2017 Budget FY 2018 Rec
* Through April MCSO Monitors and Other Related Costs
* Through April 20

Adult Probation
• The General Fund operating budget is recommended
at $52.6 and includes:
– Increases for retirement contributions of $775K
– Addition of 13 staff at a cost of $645K in the areas of
Domestic Violence, Sex Offender, Standard Probation
and support staff
– Shift of administration costs to the Detention Fund of
$830K
– Decrease in telecommunication, radio and risk
management charges of $590K
21

Adult Probation
• The Detention Fund budget increased to $37.1M and
includes:
– Increases for retirement contributions of $427K
– Addition of 11 staff at a cost of $650K in the areas of
Prison Reentry, Intensive Probation, and support staff
– Shift of administration costs from the General Fund of
$830K
– Decrease in telecommunication, radio and risk
management charges of $230K
22

Juvenile Probation
Average Caseload
250 234 2,500
216
201
200 185 2,000
2,086
1,943
150 1,792 1,500
1,564
100 1,000
50 500
- -
FY 14 FY 15 FY 16 YTD FY 17
Intensive Probation - Monthly Average Standard Probation - Monthly Average
23

Juvenile Probation
• The General Fund operating budget is
recommended at $17.6M and includes:
– Increases in retirement contributions of $295K
– Increases for telecommunications and risk
management charges of $77K
– Decreases in personnel of $328K from the
deletion of 10 positions and adjustments to personnel
savings
24

Juvenile Probation
• The Detention Fund budget increased to
$35.4M due to:
– Increases in retirement contributions of $317K
– Increases in overtime of $491K needs
– Increases in telecommunication and risk
management charges of $96K
– Changes in personnel savings of ($162)K
25

Superior Court
• The General Fund operating budget increased to
$83.9M and includes increases for:
– Equipment and software maintenance of $248K
– Telecommunication, risk management and other
changes netting to $209K
• One-time funding is recommended for:
– 2 Business Systems Analysts totaling $178K
– Continued development of Superior Court Case
Management System (ICISng) in the amount of
$1.7M
26

Clerk of Superior Court
• The General Fund operating budget is recommended
at $34.27M and includes increases for:
– Telecommunications and risk management charges
of $150K
• One-time funding is recommended for:
– Restitution, Fines and Reimbursements (RFR)
project at $1.6M
27

Justice Courts
• The General Fund operating budget is recommended
at $18.25M and includes increases for:
– Telecommunications and risk management charges
of $78K
• Southwest Regional Court Center opened in February
2017
400,000 Eviction Actions
Small Claims
300,000
Misdemeanor
200,000 Civil Traffic
100,000 DUI Traffic & Other Criminal
- Orders Injunctions of Protection Against /
Harassment
* Forecast 28

County Attorney
• The General Fund operating budget is recommended
at $88.6M and includes:
– Budget requested $367,388 under baseline
– Telecommunication and risk management charges
increase of $78K
– Retirement contributions increase of $11K
29

Assessor
• The General Fund operating budget is recommended
at baseline of $24.4M and includes:
– Elimination of 10 positions in order to streamline
operations and position department for the future
with a leaner, more efficient operation
• One-time funding in recommended for:
– Legal Class Verification (LCV) Program at $191,000
30

Recorder
• The General Fund operating budget is recommended
at $4.75M and includes:
– Recorder’s request to shift Voter Registration,
Community Outreach, GIS, and Administration
Support positions from Elections to the Recorder’s
Office totaling $2.47M
– Telecommunication and risk management charges
increase of $11.7K
– Personnel savings increase of $81.5K
• One-time funding is recommended for:
– Compliance auditor position of $88.5K
31

Elections
• The General Fund operating budget decreased to
$6.7M due to:
– Recorder’s request to shift Voter Registration,
Community Outreach, GIS, and Administration
Support positions from Elections to the Recorder’s
Office totaling $2.47M
– Telecommunication and risk management reduction
of $28K
– Personnel savings increase of $41.7K
– Addition of 5 staff for 4 months at a cost of $88.8K,
partially offset by savings of $35.3K from the
elimination of 1 position and reduction in overtime
32

Treasurer
• The General Fund operating budget is recommended
at $5.1M and includes:
– Telecommunication and risk management charges
increase of $27K
• The Treasurer’s Information System Upgrade Project
will be budgeted at $16.1M in FY 2018
33

Education Service Agency
• The General Fund operating budget is recommended
at baseline of $2.7M
• One-time funding in the amount of $253K is
recommend for the continuation of the YEES pilot
program
34

Medical Examiner’s Office
Caseload
5,952 6,000
5,679 5,800
5,600
5,379
5,400
5,200
4,904 4,945 5,000
4,770 4,794
4,708 4,800
4,562 4,600
4,400
4,200
4,000
Total Case Load
35

Office of the Medical Examiner
• The General Fund operating budget increased to
$11.4M due to:
– 2 additional ME’s which will bring average caseload
below 325 at a cost of $298K
– Deputy Chief Toxicologist at $114K
– Increase to Lab Services $46K
– Increase for the Transport Contract $60K
– Increase in telecommunication and risk management
charges of $52K
• One-time funding is recommended for:
– Case Management System in the amount of $140K
– Lab Services in the amount of $100K
36

Mandated Health Care Programs
• $2.6M increase in the Arnold v. Sarn and mental
health services taking the contribution to $60.7M
• $10.3M increase in base Arizona Long Term Care
System (ALTCS) contribution to $165.5M
• $228K reduction in Arizona Health Care Cost
Containment System (AHCCCS) contribution to
$18.8M
• Flat budget in the amount of $2.3M for the
mandated cost share to Arizona State Hospital for
Sexually Violent Persons
37

Retirement Issues
• Public Safety related retirement rates increased
– Retirement contributions from the General and Detention
funds are increasing $8.2 million
– Rates will likely continue to increase to address funded
status and outcome of litigation
38

Enterprise Technology
• The General Fund operating budget increased to $28.3M
due to:
– Content Management System Web of $10K
– Cyber Security Tools of $704K
– Phoenix IO Data Center Site Lease of $146K
– Microsoft Enterprise License Agreement of $1.5M
– Telecommunication and risk management decrease of
$13.6K
– Data center colocation savings of ($483.6)K
• One-time funding for:
– Cyber Security Tools of $159K
– Enterprise Data Networking of $6.5M
– Security Incident and Event Management of $1.4M
– Microsoft Active Directory of $3M
39

FY 2018 Use of Capital Funds
$359,162,297
Culture &
Highways & Recreation Other*
Streets 1.86% 8.95%
36.68%
Public Safety
52.51%
*Other = Computer Aided Mass Appraisal System, Enterprise Data Center, Enterprise Resource
Planning System, Remote Sites Infrastructure Refresh, and Treasurer Technology System Upgrade
40

Capital Projects
New:
• Adult Probation – Mesa Office $1.5M
• East Court Building – 6th floor $5.3M
• Animal Care – Durango Campus Expansion $2.5M
• Parks – Various Projects (14) $5.4M
Continuing:
• Intake-Transfer-Release Jail (Durango Jail) $82.3M
• Madison Street Jail Adaptive Reuse $37.5M
41

CIP Projects Awaiting Funding
•Adult Probation – Northport •OET 10-Yr Equipment
•Emergency Operations Refresh
Center •MCSO Avondale Substation
•Court Plaza Demolition/ •MCSO Blue Point Substation
Remodel/Redesign •MCSO 1920 Building
•MASH Unit Relocation •MCSO SWAT Major Crimes
•K9 Kennels Building
•Courts Master Plan •Parks Master Plan
•Jails Master Plan
Over $986 Million of Unfunded Projects
42

Budgeted FTE’s
15,000
14,729
14,662
14,500 14,364
14,157 14,148
14,000 13,896
13,471 13,572
13,500 13,387
13,348 13,277
13,000
12,500
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
* Recommended Budget
43

FY 2018 Highlights
Maintained General Fund and Detention reserves
at 2 months of operating expenses
Provide necessary funding for criminal justice
issues
New Probation Service Center
Animal Care Expansion
IT Infrastructure
Park Enhancements
Funding set aside in the General and Detention
funds for Pay-for-Performance and Market
Adjustments
44

Budget Calendar – Remaining Dates
May 22 Tentative Budget Adoption
June 19 Final Budget Adoption
August 21 Property Tax Levy Adoption
45