ALPENA - A large deficit in the county's child care budget already is having an impact on county business and could have an impact on the 2014 budget. The child care budget is grossly over budget as the cost of having seven juveniles being placed into residential treatment has sent the budget hundreds of thousands of dollars in the red and put the county's overall finances at risk.
Last year the court requested the county budget $207,000 for the cost of child care. The commissioners committed only $107,000 because the court had an equity account with about $97,000 in it. The commissioners believed if the budgeted amount was exceeded the money in the equity account would provide a buffer and cover any additional costs. The amount never came close, as the cost to house the juveniles could end up costing the county as much as $600,000 overall.
"It didn't seem like a big risk to give the $107,000 because they had over $90,000 as a cushion," finance committtee Chairman Lyle VanWormer said. "Now the $107,000 is gone, the $95,000 is gone and there is an additional $89,000 we owe right now. And the estimate to the end of the year is another $312,000. This has caused a problem for the general fund and all of Alpena County."
VanWormer said everyone is scrambling to find a way to cover the cost of what the county owes, and what it will need to pay for the remainder of the year.
"Circuit court is going to give us some of its surplus money from other accounts and then our budget stabilization fund will pick up a large portion of it," VanWormer said. "We are also going to take out $100,000 out of the general fund. But I'm not exaggerating when I say this was disastrous for the budget."
At the finance committee meeting on Oct. 16, Treasurer Kim Ludlow said the county's revenue was ahead of its expenses by about 5 percent. The commissioners were anticipating maintaining the surplus and carrying it over to the 2014 budget. VanWormer said that proabably will not happen now and balancing the budget is going to be difficult.
"That money is just not going to be there. It is going to have to come out now," VanWormer said. "The budget is so delicate. We didn't start this year with a deficit. We had a balanced budget, but there was no fluff anywhere."
Ludlow said there is $247,000 in the budget stabilization fund and it will be almost stripped clean once the child care deficit is taken from it. She said she is working with the commissioners to find budget lines that have money in them that may not be used and transfer them into lines that would allow for the county to use to to pay off the child care obligation
"Everyone is pulling together to do everything we can right now," Ludlow said.
To limit the amount of money being spent for the rest of the year, VanWormer signed a memorandum that eliminates all non-essential spending until further notice and all contracts and future project be out on hold. Van Wormer said the budget was doing so well and he is disappointed this type of action needs to be taken, when the departments have so many needs. Typically the county waits until the end of the fiscal year when a majority of the tax money is collected to make large scale purchases. This will not be the case this year.
"Everything is on hold. We have one union negotiation going on and a couple more coming, but they are all on hold," VanWormer said.
A committee has been set up that will review the treatment needs and options for the juveniles. VanWormer said 26th Circuit Court Judge Michael Mack has reviewed several cases and two of the children have been removed from placement. This will save some money for the county, but it will still cost $1,500 a day to have the other five treated.
"The cost is going to drop some once the two kids are taken out and the new panel will review the cases from now on before they are placed," VanWormer said. "The commissioners have nothing to do with that. The judge and the panel will have the final say on that."
VanWormer said he wishes Probate Judge Thomas LaCross would have notified the county sooner as to how far over budget he was on the child care budget. He said he was notified by Ludlow when she was reviewing the county's finances.
Both Van Wormer said Ludlow said they hope to be able to find away to cover the costs of the child care and not have it job cuts or more limitations put on hours.
Steve Schulwitz can be reached via email at firstname.lastname@example.org or by phone at 358-5689. Follow Steve on Twitter ss_alpenanews. Read his blog, Upon Further Review ... at www.thealpenanews.com.