Chairman’s Corner: What the Heck Is In That 322-Page Financial Report?
I confess … I’m a bean counter.
You’ve probably heard me say that once or twice over the years, but I think that may be one of my strengths as a County Board chairman, and I hope that my background as a CPA can be of service as we tackle some of the tough challenges we face as a unit of county government in the State of Illinois.
Just last week, Kane County Board members received year-end audit and Comprehensive Annual Financial Report (CAFR) presentations at a Committee of the Whole meeting. What I’d like to do in this column is to explain why that massive 322-page document is important and provide some perspective. In a follow-up next week, I’ll go into a little more detail, share some of the highlights of the CAFR and explain where we need to go from here.
In the CAFR, our board, staff and elected countywide officials are delivering two of their major financial objectives:
- To live within our current means without asking property taxpayers for more to run Kane County.
- Not only to pass a truly balanced budget (according to accrual accounting rules), but to finish the year within that budget.
I’d like you to know, first off, that your County Board members and staff have done a conscientious job of managing the budget and respecting the value of your tax dollars. Kane County has held its tax levy flat for four years now — an achievement that few units of government in the state or the nation can claim.
The sincere and honest truth is that this has been another successful year of effective teamwork that gives us cause to celebrate.
That said, the accomplishments of the past years are becoming increasingly difficult to duplicate because of unfunded state and federal mandates, unreliable revenue commitments from the state, uncertain economic conditions, and frankly, infrequent but damaging unforced errors by responsible county managers.
Part of our jobs as elected officials is to keep our eyes open and trained on the horizon, to watch out for future threats. We cannot allow any agency or county department to overspend, and we can’t forfeit advantages and cash flows that we already possess.
Here are three real, significant challenges for the coming year that residents should be aware of:
First, Springfield is threatening to reduce the Local Government Distributive Fund (LGDF), which is the 8 percent local share of income tax that our residents and businesses send to the state. If that legislation were to pass, it would blow a $2.8 million hole in our budget.
Second, our health insurance experts have warned us that Blue Cross Blue Shield is going to increase our costs by 6 percent, which represents a $700,000 additional budget burden. We’re working on this challenge in Kane County government, but we need your help, support and awareness of this staggering rise in healthcare costs if we are to address this issue holistically.
Finally, there’s the constant danger that the state’s economy could reverse direction and fall back into recession. I’m not by nature an alarmist, and if you’ve met me, you probably also know that I’m not a “doom-and-gloom” type. But it is my privilege and responsibility to protect the best interests of Kane County’s 520,000 residents, and that means preparing for all sorts of contingencies, good and bad.
History tells us we will not always have “improving finances,” as we do now. So, we need to recognize success when we see it, acknowledge those who produce it, and strengthen our position in preparation for times when we’ll need reserves and positive attitudes to weather storms from recession and, perhaps even worse, from Springfield and Washington.
Kane County Board Chairman
June 12, 2015