Children Services foregoing $1 million local tax collection in 2011

November 1, 2010

MANSFIELD -- The Richland County Budget Commission has approved a request by Richland County Children Services to forego the collection of $1 million in local property tax revenue in 2011, allowing taxpayers to keep more of their own money during this tough economy.

Richland County Children Services communications supervisor Carl Hunnell said the agency made the request to county commissioners in September. He said the agency recognizes the local economic situation and the need to decrease the tax burden on county property owners.

Hunnell said the agency expects to close out 2010 with a $6 million surplus, the result of disciplined financial practices dating back over the last eight years.

“We recognize the current painful local economic situation and the impact it has had on local residents,” Children Services Board President Nancy Joyce said. “Our agency leaders came to the board with a plan to decrease the tax burden on county property owners.

“This board thought it was a prudent plan and we unanimously endorsed it,” Joyce said.

It’s an unprecedented step in the 126-year history of the agency, which depends on a mixture of federal, state and local tax dollars to fund its child protective operations.

In 2002, the agency was in a precarious financial position. Since then, annual agency expenses have never exceeded revenues.

“We have not had significant new revenue streams in many years,” said agency executive director Randy Parker, who took over as agency director in 2002. “We had to tighten our belts, looking at the entire organizational structure, goals, policies and procedures.

“We made tough decisions then and we continue to make them today,” Parker said. “That is why we are in a position to assist taxpayers today.”

Financial experts have told the RCCS board the agency should maintain 51 percent of its estimated $8.3 million annual operating budget in a cash reserve. The agency can forego the $1 million in tax collections in 2011, meet its responsibilities under state law and still maintain sufficient reserve, Parker said.

Larry Morrison, a CPA with Kleshinski, Morrison and Morris, LLP, in Mansfield, reviewed the agency’s financial picture and said RCCS could afford the one-year tax rollback. In a letter to the agency, Morrison cautioned against those who believe the agency’s financial picture is overly bright.

“…the amount of the (reserve) should not be deemed excessive or inappropriate in light of current economic conditions, proposed tax policies, and near-term forecasts of economic growth,” Morrison wrote.

RCCS has two 10-year, voter-approved one-mill local tax levies, which generate a combined $3.2 million annually. One of these was first approved in 1958, was replaced in 1984 and has been renewed twice in 1994 and 2004. The other was first approved in 1989 and was replaced in 1999. It was renewed in 2008.
The Children Services board approved a resolution asking Richland County commissioners to request the county budget commission not to collect the $1 million in 2011. Agency leaders went over the plan with county commissioners in September and the panel unanimously approved it.

All three commissioners praised RCCS for the move.

“You guys need to be congratulated by the community ... this is a heckuva story and it’s is an incredible gesture on the part of (the agency) board, Randy Parker and his staff," Commissioner Ed Olson said. "It speaks to one word -- accountability. This move raises the creditability of the board and the administrators --- exponentially. ... During a time of economic distress, you are drawing down on your own reserves to help others."

Commissioner Tim Wert said, "You just bought yourself a cheerleading section in Richland County ... and I am one of them."

Commissioner Gary Utt said, "It’s a great day for Richland County and also for Children Services that you would do something like this for area residents. You certainly have me as a cheering section. ... You are being a good neighbor in the neighborhood."

In a letter to the agency, Richland County Auditor Pat Dropsey said the reduction will reduce the property tax bill on a $100,00 home by about $16 in 2011.

Children Services made the decision to dial back the tax collection despite another year of record activity in terms of investigations into alleged child abuse and neglect and also in the numbers of ongoing cases it maintains with local families.

“We set a new record for investigations in 2009 with 2,748,” Parker said. “Through the end of September, we are on pace to surpass that number. We also work with about 650 families on an ongoing basis, assisting about 1,500 local children.”

Parker also pointed out the Richland County general fund has benefited over the years by earning interest in excess of $900,000 from the agency’s cash reserve.

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