Linn County budget workshop: commissioners told revenue-neutral target would force roughly $1.2M in cuts; contingency, benefits and special levies under review

Linn County commissioners spent a budget workshop on July 2 reviewing the county—s draft 2026 spending plan and the effects of assessed-value growth on mill levies, cash reserves and specific program lines. Budget consultant Scott Lloyd said the county—s assessed value increase means the same mill levy as last year would produce substantially more dollars, and that moving to the revenue-neutral rate would leave the county roughly $1.2 million short unless cuts or other offsets are identified.

The most immediate choices presented to commissioners were: cut roughly $1.2 million from proposed spending, shift dollars between funds, or use one-time cash to hold the line. "The middle column has not been adjusted yet because it's last year's budget," Lloyd said, describing the spreadsheet the board used to compare 2025 actuals, 2025 estimated (the middle column) and the proposed 2026 numbers. He told commissioners he would return July 11 with a version reflecting recommended adjustments to that middle column and with options to reach revenue neutral.

Why this matters: the county's assessed value growth lowers the revenue-neutral mill rate. If commissioners choose to match last year's mill levy rather than the revenue-neutral rate, property owners whose assessments rose will pay more tax dollars in aggregate; if the board lowers levies to the revenue-neutral rate, county programs or cash balances must absorb the roughly $1.2 million difference Lloyd calculated. The discussion touched on several programs and funds that would be affected if the board pursues revenue neutral numbers.

Key topics and figures discussed - Revenue-neutral shortfall: Lloyd told commissioners the revenue-neutral calculation produces a roughly $1.2 million gap the board must address (he described the gap as approximately $1.2M). That shortfall is the staff—s working estimate of additional reductions or offsets needed to hold the revenue-neutral rate. Commissioners asked staff to produce scenarios showing where the cuts would fall. - General fund cash and contingency: Lloyd reviewed the county—s cash positions and contingency line (noting a contingency roughly in the $2.5 million range in the materials). He illustrated how moving contingency dollars in the middle column would immediately improve projected 2026 cash on hand. - Employee benefit fund and insurance: Commissioners and staff focused substantial attention on the employee-benefits fund, which Lloyd said shows a negative projected unencumbered cash position in the 2026 column (he cited a shortfall on the order of several hundred thousand dollars). The health-insurance proposal before the board would raise estimated 2026 benefit costs (Lloyd and staff reported a projected health-insurance outlay near $2.6M under a recommended plan versus roughly $2.8M under current pricing), prompting discussion of whether to change carriers and how any change would affect both premiums and employee take-home pay. - One-time versus recurring funding (ARPA): Staff described prior use of ARPA reimbursements and the conversion of some ARPA payroll reimbursements into general-fund payroll earlier this year. Counsel and staff warned that nonrecurring ARPA dollars can mask ongoing, recurring costs; several commissioners said they did not want recurring programs funded with one-time federal money. - Prisoner housing and other receipts: Lloyd and staff highlighted major nonproperty-tax receipts that affect the middle column, including prisoner housing revenue and interest income. Prisoner housing receipts were shown as a material revenue source in the current budget draft; school-resource-officer (SRO) contract income was also raised as an item that required reconciliation (commissioners asked staff to verify a $60,000 line on the draft against signed school SRO agreements that should total $72,000). - Special-levy funds and —vote-of-the-people— restrictions: Commissioners pressed staff to locate the legal basis for several small special levies (historical society, fair association, senior centers), because the board can rescind levies adopted by commission but cannot rescind a mill levy approved directly by voters. The Fair Association levy and a 2012 resolution requesting a half-mill levy were discussed at length; commissioners directed staff to locate the underlying resolution or vote record and report back before moving funds. - Equipment reserves and capital planning: Scott Lloyd and staff recommended that departments provide simple 3—-5 year capital plans showing current equipment-reserve balances and intended purchases. Commissioners asked staff to compile department-level equipment-reserve balances so the board can see which funds have built-up cash and which do not. - Landfill closure fund: Lloyd recommended creating a separate landfill-closure fund (instead of leaving money in contingency or the solid-waste operating fund) and asked staff to obtain the engineer—s closure estimate so the board can confirm the annual amount required to meet future closure obligations. - Ambulance contract and other service contracts: Commissioners discussed the county—s ambulance contract request for additional funding (an applicant-proposed increase discussed with the commissioners was roughly $75,000 per year spread over two years). The board asked staff to confirm the contract details, alternatives and whether a different procurement or a split contribution was feasible.

What commissioners asked staff to do - Verify which levy lines are "vote-of-the-people" (not rescindable by the commission) and which were adopted by past commission resolutions; produce citations or minutes. (Commissioner Ali pressed on the Fair Association levy language from 2012.) - Reconcile SRO contract income line items with signed school agreements (staff to confirm whether the $60,000 receipt line should be $72,000). - Produce department-specific equipment-reserve balances and short capital plans so the board can decide whether to consolidate or reallocate reserves. - Provide the engineering estimate and legal steps required to create a dedicated landfill-closure fund and the recommended annual contribution to meet closure obligations. - Update the middle column (2025 estimated actuals) and return a revised draft showing options to reach revenue neutral for the July 11 follow-up workshop.

Quotes - "The middle column has not been adjusted yet because it's last year's budget," consultant Scott Lloyd said as he explained how the draft was built from rolled-over 2025 numbers. - "How can you take that out and put it in the general when there was a motion already made to do the levy?" Commissioner Ali asked during a long discussion about moving the Fair Association levy into the general fund. Commissioners asked staff to find the original resolution or vote record.

Next steps and schedule Lloyd told commissioners he will return on July 11 with a revised set of spreadsheets showing recommended middle-column adjustments and one or more paths to the revenue-neutral outcome. Commissioners directed staff to begin the document searches and reconciliations described above and to send department worksheets back to department heads for quick review so the staff and the consultant can tighten 2025 estimates before the July 11 meeting.

No formal votes were taken during the workshop; the session was a working discussion and staff follow-up was assigned for most of the substantive items above.