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Trego County hopes to reduce budget

5/22/2013

By MIKE CORN

mcorn@dailynews.net

WaKEENEY -- Moments after hospital officials reported an improving financial situation, Trego County commissioners instructed department heads to plan to cut next year's budget.

The idea is to take a bit of the sting out of the anticipated tax increase as a result of $1.8 million in no-fund warrants issued to help buoy Trego County-Lemke Memorial Hospital's struggling finances.

But only about half of the money from the no-fund warrants was used to pay a host of outstanding bills, the rest tucked away in the bank as a reserve for the hospital if times turn sour again.

In addition to the no-fund warrants, Trego County voters overwhelmingly agreed to levy a 1-percent sales tax. The tax begins July 1, with the first disbursement making it to the hospital in the fourth quarter of the year.

Commissioners also have talked about boosting the county's mill levy for the hospital to the 5 mills allowed by law. That would provide approximately $265,000 annually, nearly $60,000 more than it is receiving now.

At Monday's meeting, Trego County Commission Chairman Dean Papes said commissioners hope to reduce the county's general fund by 1.5 percent. The county's road and bridge department also will be reduced by 1.5 percent.

"That's going to help us fund no-fund warrants," Papes said of the reasoning behind reducing budgets. "We're hoping we can get it down to raising no more than 2 to 3 mills."

The no-fund warrants are expected to require 8 to 9 mills -- during the next four years -- to repay.

County appraiser Lisa Reeder said she's hoping some of the increase might be absorbed by rising property valuations. Up by almost $1.8 million, oil valuations are likely to rise as well, she said.

"It won't be a huge amount," she said.

She and John Reeder, the county's contract appraisers, told commissioners earlier in the day hearings with oil companies were nearly complete.

"I'm hoping for $3 (million) to $5 million," John Reeder said of the anticipated increase in the value of oil in the county.

Papes told the group of department heads to leave salaries as they are, and commissioners will review them as budgets come in.

Papes said the request wasn't an absolute.

If increases are warranted, he said, they will be reviewed.

"Don't think we're going to sacrifice everything just to get the no-fund warrants," he said.

During the meeting between hospital officials and the county, hospital administrator Harold Courtois said 2012's Medicare review was positive.

Rather than being asked to pay money back to Medicare, this year the program will be paying the hospital nearly $118,000.

"I really feel good about the cost report," he said of the hospital getting money back.

A year ago, he said, the hospital had to repay $500,000.

He voiced concern about a suggestion that critical access hospitals should have a six-month reserve fund by October 2014.

For Trego County, a six-month reserve would amount to $7.8 million.

Currently, the hospital has $1.2 million in reserve, most of that from no-fund warrants issued by the county.

"That's where we were last year before the roof fell in," Courtois said. "We really need to get it up to $3 million."

In the meantime, however, the hospital is showing a profit of slightly more than $100,000 in the first four months of the year. That compares to a loss of almost $50,000 for the same time period last year.