Vermilion County considers line of credit for juvenile detention costs
DANVILLE — In the last several years, the state has cut the amount it pays for salaries at juvenile detention centers around the state, including centers in Vermilion and Champaign counties.
Vermilion County had to pick up those additional personnel expenses to keep its juvenile detention center open, which created a drain on the county's general fund. But revenue to the public safety building fund can't be increased proportionate to the additional expenses, because the fund's property tax rate is capped, and the county is already taxing at that cap.
So, in November 2011, the county shifted the Vermilion County Juvenile Detention Center's approximately $3 million in expenses from the general fund to the public safety building fund, which also covers expenses of the county jail. That resulted in an $802,070 deficit in the public safety building fund, and this fiscal year, the deficit is expected to be $1.14 million.
Vermilion County Auditor Linda Lucas-Anstey said prior to the juvenile detention center being shifted to that fund, it was breaking even and at one time had a $6 million reserve.
On Wednesday, Lucas-Anstey said the reserve was $1 million, but a few weeks ago, it had dwindled to just $400,000. Revenues continue to come in as bills go out, accounting for the fluctuation from three weeks ago to this week. But, Lucas-Anstey said having only $400,000 was a concern, especially with a large payment looming and many weeks before property tax revenue is distributed to the county. The public safety building fund covers salaries and other expenses at the juvenile detention center and Vermilion County Jail, and Lucas-Anstey said she and Vermilion County Treasurer Sue Stine didn't want to be in a situation where they could not pay bills out of that fund.
So they asked the county to establish a $1.5 million line of credit from the county's general fund to the public safety building fund.
The county's personnel and finance committee and property committee will meet together at 5 p.m. today (Thursday, May 9) to consider whether to establish the line of credit. The committees, which meet on the third floor of the Vermilion County Courthouse Annex, 6 N. Vermilion St., Danville, will decide whether the proposal moves on to the full county board.
Vermilion County Board Chairman Gary Weinard said Lucas-Anstey and Stine met with him, and they decided to ask the county board to create the line of credit. It's a precautionary action, he said, adding that he doesn't know that it will or won't be necessary, but they want it there in case it is.
Weinard said if the line of credit were tapped, the general fund would have to be paid back, most likely out of the 2013 property tax revenues that will flow into the county coffers later this year. He said no interest would be charged, because it's money from one county fund to another.
The county has established lines of credit in the past, Weinard said, so there's a precedent.
Lucas-Anstey said a $400,000 balance is low enough that it could pose a problem in making payroll if other revenues don't flow in at the right time. She said monthly expenses in that account are $350,000 to $500,000.
Basically, Weinard said it's a cash-flow situation.
Lucas-Anstey also said she doubts they will have to touch the line of credit.
"But we want something in place, so we could still pay for the food and salaries... and maybe we are being a little paranoid, but being here as long as I have, it's easier to be proactive," she said.
But long-term, Lucas-Anstey said, expenses in the public safety building fund are now outpacing revenues, so the county needs to consider boosting the property tax revenue into that fund.
That was not unexpected in late 2011 when the county switched the detention center from the general fund to the public safety fund, because the public safety fund does not have a property tax cap like the general fund. The county has already increased the public safety building portion of the property tax levy from a rate of 0.44 cents per $100 of assessed value in 2011, which generated $3.7 million, to .61 cents per $100 in 2012, which generated $5 million and .62 cents this year, which is expected to generate $5 million again this year.