Facing financial pressure, Linn County department heads told not to expect new money ‘outside of their existing budgets’

CEDAR RAPIDS — The Linn County Board of Supervisors convened department heads Tuesday morning to warn them they shouldn’t expect to receive surplus funds in future budgets any time soon and encourage them to cut spending where possible.

Grappling with fiscal uncertainty after state law changes the GOP-led Iowa Legislature passed earlier this year, the three-member board advised top staff to find efficiencies and lower expectations for adding staff unless it’s for a critical need.

“The board believes that we’d rather be ahead of the ball than behind it,” board Chair Louie Zumbach said of the supervisors’ effort to plan ahead. “It’s important that we all get out there and talk about this ahead of time … so there’s not big expectations of whatever might be. You know that we’re limited and we won’t be able to do everything we’ve done in the past.”

House File 718, which passed with bipartisan support, capped local governments’ taxing powers.

County general services cannot exceed a levy rate of $3.50 per $1,000 in taxable value and county rural services are capped at $3.95 per $1,000. Counties may use supplemental levies for purposes such as elections, benefits to its employees and the Emergency Management Agency, though Linn County has not needed these levies.

Municipalities’ future general fund levies can increase no more than 3 percent, regardless of growth in property tax assessments.

Linn County Finance Director Dawn Jindrich said inflation hopefully will continue to cool to ease some pressure. But she was “almost certain” there will be no “offer pot” process in fiscal 2025 — the budget year spanning July 1, 2024 through June 30, 2025 — because of a projected increase in costs related to employee wages and benefits, contracts with annual escalation clauses, utilities and fuel costs.

Typically, through the offer pot, county departments go through a process to compete to add new roles if there’s additional revenue. More of these requests have gone unfunded as the county has grappled with budget concerns.

In fiscal 2023, the budget year that ended June 30, Jindrich previously said there was $2.2 million in offer requests from county departments for 20.75 full-time equivalents that supervisors could not fund. That was after the passage of Senate File 181, a bill that corrected a state error that left local governments down millions in expected revenue. Linn County had to reduce spending by about $1.74 million for fiscal 2024 from what it had expected.

“Departments should not expect to receive additional funding from outside of their existing budgets,” Jindrich said. “Management should look within their budgets to reallocate resources.”

There may be more flexibility for onetime expenses on equipment or other items, Jindrich said, but it’s less likely the county will be able to fund new ongoing operational costs such as salaries and benefits or ongoing contracts.

Several department heads have indicated they are grappling with labor shortages and growing workloads.

County Attorney Nick Maybanks has asked for another criminal prosecutor to keep up with a record number of victims as violent crime rates rise. Recorder Carolyn Siebrecht said staff in her office are staggering lunch breaks to keep serving customers during the lunch hour, arriving to work early and staying late and sometimes working weekends to keep up.

To get staffing needs met, Jindrich said, “you’d have to prove how it was a critical need for you and how it’s more pressing than someone else’s needs.”

Supervisors encouraged department heads to keep an open dialogue about the needs they’re facing and said they would still try to meet these needs, but that it may take more time than usual.

“As a team moving forward, this part isn’t going to be easy but we again are going to need your help, your level of professionalism, your guidance within your own departments that you know very, very well — how are we going to make some things work?” Supervisor Kirsten Running-Marquardt said. “There are going to be some difficult decisions … but we want to make it work.”

Zumbach, the only Republican on the three-member board, in his May State of the County address pointed to high inflation fueled by federal policies as a source of blame for the county’s fiscal crunch, lamenting the “trickle-down politics” of the federal government where Democrats control the White House and Senate while Republicans hold the House majority.

Supervisor Ben Rogers said he didn’t think it was right that Gov. Kim Reynolds and state lawmakers restricted the county’s growth as the community’s needs increase.

“This will come at the expense of providing the necessary social safety nets that counties provide,” Rogers said. “Simple as that. We’re designed to provide those critical social services, and I don’t see the need going down any time soon. The need is up everywhere in our community.”

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