Review of 2010-11

Floods
June of 2010 brought heavy rains and accelerated snow melt from the mountains surrounding Eagle and Pine valleys. Baker County emergency management and road department put in long hours coordinating the event with local citizens and government agencies. Though it was a major weather event, the loss to the area was kept to a minimum. Baker County lost two bridges in Pine Valley and individual landowners received significant damage. We learned a great deal about the permitting process with our work with the state and federal agencies and will be able to respond more efficiently as future events unfold. As I write this budget message, we continue to have a record snow pack and it is raining hard. Hopefully, we will not need to put our Emergency Operating plans into action.

Anthony Lakes
The owners of Anthony Lakes approached Baker County in the spring of 2010 with the idea of Baker County taking over ownership. The Commissioners analyzed the situation, held public hearings and eventually decided it was in the best interest of the citizens of Baker County to take the gift of the ski area to keep a valuable asset operating.

On October 1, 2010, the assets of Anthony Lakes passed into a non-profit entity known as Baker County Development Corporation (BCDC) with the Board of BCDC being appointed by the Commissioners. The transaction was set up so that Baker County has no financial interest in the ownership of Anthony Lakes. The BCDC Board operated Anthony Lakes this past year and had an outstanding year. The resort had 50 employees working during the month of December and our Transient Lodging Partners had a significantly better winter season because of Anthony Lakes.

Courthouse Disaster & Renovation
On November 28, 2010 a pressure pipe burst on the 2nd floor of the Courthouse sending water cascading down the center of the building. Significant damage was sustained. The Courthouse operations were moved to the North Baker School and operations continued there during restoration for approximately 5 months.

Much appreciation goes to Baker School District and Baker City for their help in housing County personnel in the interim. We are now back in the Courthouse with new paint, floors and a sense of relief.

City/County Interaction
Baker County and Baker City have worked hard in the past year to look at ways to consolidate local government functions. This spring we have taken over the City Planning function while their Planner is on maternity leave and look forward to other collaborations in the future.

I want to thank all our employees and constituents for their patience while we underwent the Courthouse repairs. Though we were scattered about the community, our priority of customer service was maintained.

Revenue Overview

• Property taxes have slowed, projected up 2.5%.
• PILT funding is down $300,00 due to increased SRS funding for the Road Department.
• State funding is down across most departments.
• Justice Court revenues are flat.
• Fees have not been increased.

Expenses

• The bulk of County expenditures are personnel.
• Blue Cross/Blue Shield health insurance is projected to be up 6% with all County employees taking a less expensive plan.
• PERS rates have risen dramatically. Tier I/II is up 36%; OPSRP is up 25%; Police is up 19%.
• Currently in negotiations with the Law Enforcement unit. No pay raise included in the budget.
• Pay raise for elected officials is 0%
• Pay raise for SEIU and Dept. Head/Non-Represented is 2%
• All department budgets are lower for materials and services and capital.

2011-12 Budget Overview

Revenues for 2011-12 are projected to be down $317,000 by backing out grant funds for Recovery Village. Additionally, PILT funds for the Road Department are down $200,000. This leaves us a revenue shortfall of $117,000 for the general fund.

Expenses have continued to increase in health insurance and PERS. All general fund budgets took a minimum 5% cut. Transfers from the general fund to all special funds have been cut dramatically. Significant cuts have been made to all areas in the budget.

These are indeed tough economic times. The bulk of our resources go to personnel and this budget does not include cutting any general fund positions. I plan to ask the Board of Commissioners to immediately institute a hiring freeze for all positions in the general fund or any special fund that has significant contributions from the general fund. I believe that we can achieve personnel savings long term and limit our unemployment costs by not filling positions due to resignation or retirement.

Though I have not projected the savings in this budget, I realistically believe that we can realize savings of between $100,000 and $200,000 based on vacancies or retirement in the 2011-12 budget. To that end, I have reduced the contingency fund by $31,764 with the overall goal of replenishing this as the year moves forward.

I look forward to the budget discussions over the next two days. As we deliberate on these important decisions, it is imperative that we look towards providing service to the public while protecting our infrastructure, safety and health of our constituents.

Thank you,

Fred Warner Jr.