 Welcome to Sheboygan County government working for you. My name is Adam Payne, County Administrator and co-host of this program with Chairman Roger Distruty. As you know every month we strive to bring a different department roles and responsibilities to your attention and give an overview so you can learn a little bit more about the breadth and the important work that happens in Sheboygan County. And today we're very fortunate to have our finance director with us, Mr. Terry Hansen. Terry welcome. Thank you Adam, pleasure to be here. Terry's been with us now for believe it or not five years. This is the fifth budget that he's gotten a key leadership role on, his fingerprints all over. So we're going to talk a little bit today about our overview of our budget process as well as the good work that's happening in the finance and IT department, a consolidated department. But Terry please set the stage by sharing a little bit about yourself. When did you start with the county and let our viewers know we are? Well as you mentioned I started in 2010 so this is the fifth budget cycle that I've been with the county and prior to that I was with the city of Sheboygan and had government experience prior to that on the state level, a quasi state government organization as well and also another municipality in Minnesota. So quite the breadth of experience and governmental accounting and I'm happy to utilize those skills here in Sheboygan. That's right, we did kind of steal you from the city of Sheboygan there five years ago didn't we? Yes you did. Any regrets? Have you been hoping to go back to the city of Sheboygan? Are you okay with Sheboygan County? This has been a phenomenal move for my career. I think it's just been a great time everybody in the county is great to work with. While I do miss some of the people at the city I do enjoy my time with the county. And you've really built a good team I've been impressed with how you've very effectively put some good people around you and of course as I mentioned it's not just the finance department it's the finance and IT department. Talk a little bit about that. Well in 2011 we consolidated the two departments and we had a lot of staff transition during that time and the goal was to make the department more efficient more effective and deliver better services to the to the county departments and with partnering with a local company Datamax IT services in Sheboygan we were able to deliver better services to all the departments. We have cut our costs by over $260,000 a year and we have been able to invest more funds into newer technologies and better utilizing those for the departments and we have built the staff up or we're still below the staffing levels that we were before but we have been looking at adding competent staff to deliver the services that we need tomorrow as well as today. So big picture if someone hears of the finance and IT department in Sheboygan County what are the roles and responsibilities of this department? Well with the finance division we handle everything financial related so we do everything from preparing the financial statements helping and assisting with the budget taking the lead on that under your leadership and then also ensuring that all the departments are recording things properly properly recording grants paying all the bills and assisting with the budget and also business planning for the various departments. On the IT side what we do is we handle all of the information systems that the county utilizes so everything from the computer aided dispatch that the sheriffs use to get people to where they need to be all the way to how we record our accounting entries to the system that we use for that to the taxation software that we use as well too so it's quite the breadth of software and right now we're in the midst of implementing a new software system for health and human services so we cover all of the IT needs anything that needs a computer we help support and help move them along. Very good we're gonna come back to that a little bit more but I'd like to start with the budget process and and how the annual budget is put together share with our viewers you know when we start the budget process and try to give a high-end snapshot of how that process unfolds. Well we start early in the year and sometimes we start as early as February and we develop a budget assumptions and how we want to what we're looking at what challenges we will be facing in the upcoming year and then we develop those assumptions prepare some estimates as to what our budget gap would be of what we're tasked with and then we bring that before the different committees we bring it before the executive committee the finance committee and we also involve the HR committee as well and we set up those budget go over those budget assumptions and then develop budget goals and targets and then once we develop those goals and targets we share those with all of the department heads and we've been keeping them in the loop as well in the whole process but we really kick things off at the leadership forum in early June where all of the county board supervisors here the assumptions they look at the goals they see where we've been they see where we're going and then we have our budget kickoff with all the department heads at the end of June and from that point then we really get into the meat of the budget process where all the departments are working with their respective staff developing their budgets so meeting with me and you to discuss what they're looking at going back for revisions if necessary but then ultimately giving it to their liaison committee they sign off on it then they come and present to the finance committee and then from the finance committee it goes on to the full county board piece of cake simple so from February to October actually November until it's done it's a lengthy process it's an arduous process but it's one where we've had tremendous collaboration and teamwork I've been here almost 16 years and and Tara you've done an excellent job as finance director or finance and IT director in your leadership role but we've really had a tremendous collaboration here and it starts with chairman Roger just Rudy and the executive committee and the finance committee and of course this fantastic teamwork amongst our department heads and our liaison committees maybe that's a bit of a lead-in to my next question but what have you seen in your experience you worked for a local unit of government in Minnesota you worked for the city of Sheboyga now working for Sheboygan County the last five years how does our budget process differ or what do you see as some of the strengths to the process in comparison to other budgets you've helped put together I think the biggest strength is the communication with everybody making sure that everybody's fully aware of what we're looking at what we need to accomplish and then the teamwork and building off of that communication every department's working together and trying to accomplish all those goals and there are no surprises all the departments know early on in the game what what we're facing and I think that that's the biggest is the longer the longer process but it's very well communicated and a big collaboration between administration the supervisors and the departments and I think it it's by far the best budget process I've been involved with and obviously you've been a part of continuing to improve upon it so the last five years you've had a chance to get your fingerprints on it and further improve the process any examples that you can share where you've helped again further develop it and improve the budget process we have in play well I think some of the items that we we have improved upon is we have really developed an accounting lead role in the budget process and we have been developing accountants within the finance department that can go out and assist and kind of help the department heads with their overall budget planning where they want to go and what they would need to do and try to help position them there so we've really enhanced that over the last few years and I think one of the other biggest changes this year was more of a paperless budget process before we'd go through endless reams of paper and different copies and versions and I think now is distributing a distributing it electronically we have ease that burden of which version are we looking at and and people always have that information ready and available so those are two of the biggest changes that we've done most recently two great examples and one ones that you've really stepped up and provided outstanding leadership if if the camera over my shoulder here can zoom out a little bit or on to Terry's lap you see he's got an iPad there on his on his knee and Terry really I mean you led the charge with the county board going paperless I know when chairman Mike van der steen was at the helm he had some interest in seeing this happen and certainly supported that but as you know and and many of my co-workers know I'm not an IT expert that's not necessarily my cup of tea or passion but it is for you and between you and chairman Roger distruity and the finance committee and now the whole board is using these iPads and we have literally gone from binders of information or tremendous amount of handouts at committee meetings to everyone looking at that iPad and being able to file through as well as more easily access information from prior meetings or minutes so it have you so that's been a tremendous asset to the county and I really appreciate your leadership on that front Terry well done thank you last question before I turn it over to the chairman sometimes citizens ask well how does this budget process work you have a county board chairman the chief elected official you have a county administrator the chief administrative official you have department heads you have liaison committees you have the county board you know tremendous amount of communication and collaboration needs to occur to put a budget to process together but what's the respective roles of these key leadership positions well the overall budget responsibility lies with the county administrator and so you take the lead as far as establishing the parameters in the process and work hand-in-hand with the county exec or the county executive county board chairman to establish the goals and targets and then bring those forward with the various executive committee the primary leadership committee for the county board and the finance committee that deals with the financial matters and now including the HR committee which is more for the benefits and the pay increases that we're looking at providing and incorporating their input on that process and the various liaison committees look at the operational aspects for all the departments that they oversee and have their input operationally from a policy direction of is this going in the right direction and not and give their approval as far as how that budget process that goes from the department head but from the department head they're looking at it from an professional administrator aspect of what do we need for our department to run function to function properly and to run efficiently and then with the resources that we have what do we need how do we need to allocate those resources so from the tactical aspects and strategic department heads to the policy aspects from the supervisors and then overall from a county-wide perspective you and the county board chairman and the executive committee getting in on there on those different levels nice overview I I think what Roger and I take pride in while I know we all do Terry is that so often here when the budget is ultimately adopted it's very anticlimatic as chairman to Strudy and I interact with our peers across the state and I'm sure it's the same for you Terry is finance and IT director you know you hear about the hand wrangling and the late nights and the long meetings and people getting up on their soap boxes and really it becoming very confrontational we just haven't seen that here in Sheboygan County for over a decade now and I truly think you hit it on the head earlier it's good communication we have so many good thoughtful people but we really take a collaborative approach as you said it's it's my budget to ultimately recommend to the county board but if I did that alone as some administrators or counties execs do the county board could say the heck with that and then start preparing really their own separate county budget annual budget and then they try to meld the two together and it can really get time-consuming and confrontational so I think it's a real credit to determine to Strudy's leadership and all of our staff and everyone involved we've got a pretty good well-oiled machine here and hopefully that'll continue for some time to come and with that I'll turn it over to you Roger thank you Adam and great to have you with us Terry and and thank you for your help in making that process go smoother every year and I think a lot has to do with the electronic part of it and being able to get those numbers to us right away and we can make decisions accordingly and I know years ago we used to have we could expect increases of the property value of five percent plus and the last few years that has dropped and now it's sort of flattened out and that's really affects us quite a bit in our our levying of the taxes would you explain the equalized value and how it impacts the tax rate and everyone in the county and equalized value is the overall value of the county and each home gets assigned or property gets assigned a portion of that equalized value and then that equalized value is used to determine the tax rate and the tax rate is simply the tax levy that the county needs the number of the amount of dollars that the county needs to operate and divided by the equalized value so that's how we come up with the tax rate and the tax rate however it can get become very convoluted because that equalized value can shift between and between different municipalities so some municipalities might see an increase in equalized values other municipalities might see a decrease so just because the county overall might stabilize or be at a point four percent increase like we were for this last year we that doesn't necessarily mean everybody's going to see that it's a combination of every property throughout the county but before you leave that I want to make sure our viewers understand it so what drives the equalized value number what how does that number get developed well that number gets developed and it's established by the Wisconsin Department of Revenue and they establish the equalized value and they have different formulas that they build this off of and the overall goal of an equalized value is to just exactly in the name equalize out the property values throughout a community so if one community has a large assessment that goes up and another community has a large assessment that goes down they want to equalize this value out so there isn't a shift in county tax burden from one municipality to another because their assessor their assessors are doing different things so this is a statewide approach to try to equalize it so your taxes stay relatively flat and that burden does not increase or decrease significantly from year to year and would you explain that the state tax imposed imposed levy limits and we have our own self-imposed limits on how much we can spend would you explain that to our viewers yes in the past the state had levy limits that were often had an inflationary factor where they would say 3% or 5% plus net new construction well in recent years they've changed it so now it's 0% or net new construction whichever is greater and the county's net new construction has been less than 1% ever since they've adopted this so our self-imposed levy limits really took effect before when we have more latitude as far as we could increase 5% or 6% the county often took a more conservative approach and would only do maybe 1% or even reduce the rates which there was a time between 2007 to 2012 they decreased the rate 4 out of 5 years however with the levy limits we can only increase the levy attributed to net new construction and net new construction is what new buildings or what new value is being improved overall in the county and that is what you can increase your levy on is associated with that new construction and what is the current county tax levy and how much has it changed in the last five years or since 2007 might be a better breakpoint okay the proposed levy for 2015 is $47 million slightly above that in 2014 the current year it's at $46,444,000 however back in 2007 the levy was $45,412,000 so from that point forward as I mentioned we lowered the levy four out of the five years there and right now the proposed levy in 2015 is only three and a half percent higher than it was in 2007 so seven years have passed or eight years all have passed and the tax levy has only increased three and a half percent there's many different commodities that you buy right now that would are not even close to a three and a half percent increase in that time and we're talking locally but how do we stack up about against the other counties throughout the state and for instance how much have others increased during that time compared to us well we did a rough analysis and have kind of been moving it forward and if we look at 2014 the time difference between 2007 and 2014 if the county would have increased its tax levy by the average that all counties increased so some might have increased at 10% some might have increased at one but on average if we would have taken that average and increased our rate by our levy by that we would have ended up taxing our residents an extra forty four million dollars from 2007 to 2014 so it's a significant amount of savings that the taxpayers have realized by the by the good work that the county board has done by keeping the tax levy in in check if you want to use that term and what are some of the major challenges that that we have to face to keep those taxes down and lower them the some of the biggest challenges are the inflationary costs just because net new construction might be point four percent or point six percent doesn't mean inflation stays at that rate we see inflationary costs of around one one point six to two percent in the last few years so we have those inflationary costs we have contracts that we have that have higher increases for employees and then just overall trying to make sure that our employees wages are staying somewhat love a competitive you know one percent increases still greater than the net new construction but by far is not a large increase for somebody and then we have our health insurance that we have to worry about as well too the health insurance costs are increasing and we're trying doing different things to try to keep those in check but the largest factors are the inflationary costs and our health insurance and then there's also those outside factors that and other outside factors that we have no control over is depending upon what the state does actually this year we've had some good news from the state having some increases in state aid this last year that were unexpected however in prior years we've seen our state aids and state revenues dropping and so we have those aspects that we have to deal with as well too and that's just some of the ways the state budget impacts this there are others that they put restrictions on us or mandates or anything else yeah there are different restrictions on what we can end up and collecting revenues for or if we do collect fines and forfeitures from say the clerk of courts there's a certain amount that has to go to the state so we have to go out and collect these revenues and then give a majority of it to the state so we're not able to collect all those and then in addition we have unfunded mandates as well so there they'll impose some regulations that we have to administer and make sure that we're following up on but there's no funding to go with that to support those programs that they're putting upon the county thank you Terry it's always great working with you and I'll turn it back to Adam thank you Mr. Chairman yeah great great example of an unfunded mandate is every county has to have a clerk of courts and our clerk of courts is Terry and Roger know they collect fines and forfeitures and help administer our court system our five circuit courts whether it's getting our jurors organized or taking minutes at the at court sessions what have you they administer the courts and of course you want every county to have fair and consistent judicial services and what's interesting is the state mandates that we provide this service yet county taxpayers are now supporting the clerk of courts office to the tune of over seven hundred thousand dollars of property tax levy a year and one might say well why is that if the state's requiring the county to do something how come they're not providing sufficient revenue to get the job done and the answer is is because in many areas the state over time has gradually provided less and less to support or fund certain programs and services what really annoys me personally about the clerk of courts office and we've talked about this internally and certainly to our legislators and others for years is as Terry said the clerk of courts office collects revenue fines and forfeiture they collect millions of dollars but we have to forward that all onto the state and then we don't get sufficient money back to fund the program so the property tax payer subsidizes that office unlike the register of deeds the register of deeds collects enough revenue from its state mandate to administers programs child support is another department but health and human services clerk of courts law enforcement there are a number of areas in Sheboyin County where we're required to provide a program or service but not given sufficient resources to get the job done so we carry that burden over to the property tax payer and as we all know folks love receiving that property tax bill particularly around Christmas time and of course I I say that tongue-in-cheek property taxes are probably the most despised tax there is out there so many challenges in front of Sheboyin County to hold the line but we also have many good examples of streamlining or gaining efficiencies and it goes without saying that we're always trying to improve in Sheboyin County and and Terry I'll turn it back to you with the excellent example of the finance and IT consolidation not only did that a consolidation occur a couple few years ago we've had nearly a dozen consolidations in the last 10 years why don't you share a few examples of some departments that we've consolidated in garnered savings and efficiencies sure and we've over the years the county treasure and the real property lister have been consolidated we've consolidated planning and conservation together and then as you mentioned the finance and IT and then in addition we have a consolidated transportation created department transportation which consolidated highway and the airport and put them together as well too so I'm probably missing some because I know that the list is very extensive when we go through that but those were some of the bigger ones and probably more recent ones that we've done and at Garner's administrative savings and then specific to finance and IT that you led the charge on I think your annual savings if memory serves close to $250,000 a year correct we and that's money that goes back and that we ended up reducing and then not only that we have additional savings from operations that were able to reinvest into newer technology so we're investing more but spending less so it's a it's definitely a win-win situation with that consolidation every budget process we establish priorities the county board chairman distruty and others have led the charge on program evaluation and prioritization processes we've done that twice we review that as part of the budget process and of course there's always new initiatives and challenges forthcoming from the community and one thing that we'd like to see more of is community involvement we only have a couple of minutes remaining terry but please briefly share how can the public get more involved in with the budget process and what are the next steps ahead well all of the meetings with the liaison committees and finance committees are all posted on our website and they tell you which departments are going to be looked at and how they're going in there's actually information about the budgets with those agenda packets and then finally we have our submittal of the budget is going before the county board on the 21st and then on the 28th there's a public hearing to hear the public's comments on the budget process and then finally we adopt that on November 4th so this is really coming up to the end of the time when the public can have their input on the 2015 budget and any time if they have questions they can always contact the finance department and I'd be happy to talk the budget with them. Outstanding overview thank you terry we covered a lot of ground but great overview and if you have more questions for terry don't hesitate to contact Mr. Hansen or his staff directly in the finance and IT department we've got a wonderful website that their department was very helpful in pulling together so take a look at that and we appreciate certainly your suggestions for improvements so don't hesitate to reach out to us or any of the county board supervisors next month we're going to have Charlene Cobb here our veteran services officer in November we celebrate Veterans Day and every day should be Veterans Day but we'll celebrate that in November and Charlene Cobb is going to be here to talk about the very important roles and responsibilities of the veteran service office until then thanks for joining us.