Peoria County staff recommend delaying $900,000 transfer to long-term care fund; board to revisit next month

Peoria County staff told the Finance, Audit and Legislative Affairs Committee on a procedural meeting that Headington Oaks retirement-facility bonds will be callable in February and that current conservative projections indicate the county can meet the debt payoff without making a planned $900,000 transfer from the general fund this year.

The committee heard from county staff member Heather, who summarized the account history and projections. Heather said the outstanding principal on the Headington Oaks 2022 series is $11,075,000 and reminded the committee that a board resolution adopted in December 2023 established a policy to transfer 50% of any general-fund surplus at fiscal year-end to the Long Term Care Services Fund. She said a $3,269,000 transfer from the FY23 surplus already bolstered the fund and staff are monitoring investment returns and tax receipts.

The Why: The nut graf — the decision affects both the county’s ability to pay off the Headington Oaks bonds when they become callable and the long-term sustainability of the county-funded ombudsman service that the fund supports. Heather said that under a conservative projection that assumes no further general-fund transfers, the fund would hold about $1,000,000 at the time the bonds are callable and that amount would support roughly 14 years of the ombudsman program at current service levels. She said including a $900,000 transfer this year would raise the projected fund balance to about $2,150,000 and extend the program’s funding horizon.

During discussion, committee members and staff clarified that dollars placed in the Long Term Care Services Fund are restricted to long-term care services and related eligible expenses. Board member Steve asked whether administrative reimbursement (for staff time spent on the ombudsman program) could be charged to the fund; county staff said fractions of staff time spent administering the program would be eligible reimbursement under the fund’s restrictions if needed and if other conditions required it. Committee members also pressed whether the multi-year projections included inflation or interest; staff said the cited “14 years” estimate used current program costs and did not include additional inflation but did not include projected interest earnings on the balance.

Heather recommended that the committee not transfer the estimated $900,000 surplus from the general fund this year, saying the fund appears on track to meet the payoff target and the county would retain flexibility to transfer funds in future years if needed. Several members — including Board member Rob — said they had reservations about locking funds into a restricted account and asked staff to consider other capital needs, such as jail renovations. Staff said the board can choose to direct future surpluses toward capital projects instead, create a separate capital-project fund for a jail project, or adopt policies that allow annual review before making transfers.

Outcome and next steps: Committee members said they were broadly comfortable delaying the $900,000 transfer for now and will put a resolution before the committee for a vote next month. No formal transfer was approved at the meeting; staff will bring a resolution back to the committee for formal action and to clarify timing and any policy changes needed to the December 2023 directive.

Ending: Committee members repeatedly asked staff to supply final audit numbers and to continue updating projections during the budget cycle so the board can make a data-driven decision when the resolution returns for a vote.