Lawlor Memo on Unfunded Mandates

MEMO TO THE ILLINOIS LOCAL GOVERNMENT AND CONSOLIDATION AND UNFUNDED MANDATE TASK FORCE TO: Governor Bruce Rauner

Lt. Gov. Evelyn Sanguinetti

FROM: Lake County Board Chairman Aaron Lawlor DATE: March 5, 2015

I applaud your efforts to take the actions necessary to bring Illinois back to financial solvency. Lake County has a proud tradition of fiscal responsibility, balanced budgeting and maintaining a AAA bond rating. Getting there has required us to make tough choices over the past number of years.

I realize that the State’s fiscal problems have been years in the making and were caused by both political parties. As you have stated, digging ourselves out is going to take everyone at the table and requires shared sacrifice. It also will require a thorough vetting of how government does business, what we can do to be more efficient and how we can identify and discard the hundreds of unnecessary mandates that cost taxpayers millions of dollars every year. To assist in these efforts, I am enclosing a memo on unfunded mandates and other efficiency opportunities that should be considered by your newly formed local government task force. The immediate cost savings identified in the report add up to $2.1 million and millions more in ongoing savings related to restructuring compensation packages and workers’ compensation reform.

There is no doubt that this will be a difficult conversation. Each item has a constituency and many have entrenched special interest groups behind them. However, if we are not able to carefully weigh costs and benefits of each mandate, we will not provide any relief to local governments and taxpayers.

Please do not hesitate to contact me with any questions regarding the memo. Again, thank you for your leadership to bring the State of Illinois back to fiscal solvency.

MEMO TO THE ILLINOIS LOCAL GOVERNMENT AND CONSOLIDATION AND UNFUNDED MANDATE TASK FORCE

• • •

Publications, Records Retention, Microfiche New technologies and advanced methods of communication exist that would result in more convenient transparency for taxpayers, yet the State mandates publication of certain notices, as well as other measures, that are antiquated, inefficient, and costly. Specific examples include:

• The County spends $8,000 a year to

publish bids and RFP’s in newspapers, despite the fact that any vendor can register on the County’s website and receive more detailed information electronically.

• Lake County spends $100,000 annually publishing assessment notices in the newspaper, and spends $230,000 in the General Assessment years. The State should consider changing this publication mandate if the County is communicating with property owners through other communication methods, either direct mail or electronic.

• The County is required to retain various paper records, which have to be stored and managed (at a cost). For example, Accounts Payable paid invoices are scanned into our financial system prior to payment, but also are required to be kept in the paper form for seven years.

• The County is required to place certain records on microfilm or microfiche. There are much more efficient technologies available today which are just as effective at indexing and organizing in a more economical fashion. Changing this mandate could save the County approximately $185,000 annually.

Regional 911 Dispatch Consolidation

• Lake County, in partnership with our Emergency Telephone Safety Board, is taking a leadership role in exploring a consolidated 911 system in Lake County to improve quality of emergency dispatch and response services, and provide significant cost savings.

• The State could assist local governments in Illinois by creating an incentive - using existing funding streams - that would encourage local governments to consolidate.

• In Lake County, a high-level study to assess the opportunities for 911 dispatch consolidation showed that our 17 ETSB’s and 24 PSAP’s spend approximately $33 million a year on operations. The projected overall operational savings range from $2.3 Million to $10.4 Million depending on the level of consolidation of PSAP centers.

• A core working group held meetings around the county with municipal leaders, fire chiefs and police chiefs to discuss their priorities and how we can advance this initiative together.

Changing Publication & Mailing Mandates Could Save Lake County: $238,000 (Every

General Assessment Year)

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• In collaboration with municipalities, police and fire departments we developed and issued an RFP for a phase two study to do the technical analysis that will allow us jointly move forward on this critical initiative

• Many local governments and states have already implemented a more consolidated model for call taking and have been successful.

Elections

• Over the past eight years, a significant number of mandates have been imposed specifically geared to expanding options to register and vote including: provisional, early, and grace period voting; voting by mail; and bilingual ballots and election materials. These mandates have come at a significant cost to Lake County, and have not resulted in increased voter turnout as it aimed to do.

• For the 2016 election cycle, new mandates include voter registration in every polling place on Election Day, grace period registration, and voting in every early voting location for any voter in the county.

• These most recent mandates are expected to cost Lake County in excess of a $1 million.

• In addition, there are inefficiencies within these mandates. For example, the County is required to print 110% of ballots for every precinct, when we know voter turnout will be only 70%. This is inefficient spending.

• Also, the State mandates a certain number of staff at polling places with multiple precincts, when the County could identify more efficient staffing measures and save money.

• Despite these mandates and cost increases, voter registration and turnout have remained constant in the low 70% range for presidential elections, and the low 50% range for gubernatorial elections.

Presidential Elections Gubernatorial Elections

Voter Turnout Voter Turnout

1992 84.56 1994 51.04 1996 70.13 1998 51.23 2000 70.35 2002 52.53 2004 72.2 2006 51.57 2008 74.14 2010 51.28 2012 71.18 2014 50.13

Most Recent Election Mandate Cost to Lake County: $1 Million

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Juror Pay

• Recent legislation mandates additional daily fees to be paid to jurors. • The new law increases payments to jurors to $25 for the first day, and $50 for each additional

day. Previously, the law mandated $5 for the first three days, $7.50 for the next two days, and $10 for each additional day.

• This mandate has an estimated annual impact of $400,000 of additional cost to the County.

• While this law was intended to lessen the burden of jury service, many employers provide normal pay to those called to jury duty. Data shows that over 80% of jurors do not lose pay as a result of service and the County payments are in fact turned over to employers.

• Therefore, this mandate increases cost without helping the majority of the jurors that it is intended to help.

Workers’ Compensation

• Lake County is concerned about the cost of workers’ compensation. • After reviewing Lake County’s specific history, the County believes the following specific

changes could be beneficial: o Clarify the scope of covered conditions and define what is an injury that occurs due to

the worker’s employment (causation). This includes restoring the original intent of the law that the system covers only work-related exposures and conditions. For example, Lake County has experienced losses in excess of $500,000 related to claims made in parking lots prior to/post work that are considered workers comp (as the County directs where employees should park).

o The establishment of a primary causation standard. For example, a worker could injure himself outside of work and then aggravate the injury on the job, and the employer would be responsible for a workers’ compensation claim.

• Reduce or stop doctor shopping and strengthen the American Medical Association standards that are used to determine the level of impairment an injury causes.

• Consider adopting some of the “settlement limitations” imposed by other states. • Reform at the IWCC, including time requirements regarding the resolution of controverted

claims.

Juror Pay Mandate Cost to Lake County: $400,000

Annually

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• • •

Use of Special Revenue Funds – Inmate Welfare Fund

• Revenues generated at the jail commissary are deposited into the Inmate Welfare Fund. This fund has a large, and growing, fund balance, but the State mandates that these funds can only be used for the benefit and welfare of inmates, and not on the basic costs of incarceration.

• Currently, the County spends in excess of $2 million annually on the medical care of inmates and is unable to access inmate welfare funds to offset these costs.

• Allowing the use of inmate welfare funds for the cost of basic medical care would help defray the cost of inmate care and reduce the use of tax dollars.

Prevailing Wage

• Current laws require the payment of prevailing wage for all public projects involving laborers, workers or mechanics, whether construction, maintenance or repairs.

• The ability to use non-prevailing wage labor for repairs and maintenance under a certain threshold will reduce costs for routine, non-life safety work. As an example of costs, the prevailing wage for painters is $34 an hour for even small jobs like painting an office.

• Allowing non-prevailing wage labor on routine maintenance below a certain threshold would have a significant positive financial impact on local governments.

• Many small businesses are not equipped to comply with prevailing wage administrative requirements so an additional benefit to changes in prevailing wage requirements would be an increased ability to use small local and emerging firms.

Labor Relations The County believes certain items related to labor relations should be reviewed, including:

• Limit mandatory subjects of bargaining to wages and benefit time to allow the County to exercise efficiencies, such as changes of work hours to meet work demands. For example, the ability to schedule weekend shifts for 24/7 operations.

• When unresolved contracts go to interest arbitration, (for the purposes of determining raises), more consideration should be given to other wage increases for Lake County’s union and non-union employees. In addition, cutting funding for other vital services should not be viewed as a way to satisfy the ability to pay question.

• Currently, an election is not required for a group of employees to organize. At least 50% plus 1 of the group who seeks representation should vote to approve such action. Current law only requires a signing of cards by 50% plus 1.

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Probation for Non-Violent Offenders/Sentencing Reform

• Certain mandated probation sentences for juveniles may be longer than necessary, such as mandatory 5-year probation sentence for forcible felony conviction, which includes non-violent offenses like breaking into a car.

• In some cases, these non-violent offenses could otherwise be a 6 to 12 month supervision case, depending on the offender risk profile if not for this law.

• It is estimated that these types of changes could save Lake County $150,000 a year.

Probation Services Funding

• In accordance with the Probation and Probation Officers Act, probation services are mandated by the State of Illinois as part of the Court Services program.

• Historically, there is a significant, multi-million dollar funding gap between cost for probation and state reimbursement.

• Although an increase in salary reimbursement funding has been realized for the current fiscal year, adequate funding for Probation and Detention services throughout the State of Illinois remains a critical issue.

• The continuation of Probation and Detention funding is essential in order to maintain safe communities by insuring offender accountability. A reduction in funding will only serve to diminish the capability of court services to accomplish the mission of creating safer communities and insuring offender accountability.

Marine Patrol

• Due to inadequate IDNR resources to patrol State waterways, the County patrols the Chain of Lakes and Fox River.

• The Fox River Chain O’Lakes is the busiest inland recreational waterway per acre in the United States.

• Nine interconnecting lakes provide over 6,000 acres of boating waterways • The County budgets $350,000 on the Marine Patrol Unit yet only receives $40,000 in revenue

from the issuance of citations.

BID/RFP Limits

• Purchasing limits mandated by the State have been in place for years and do not represent the same dollar value as when they were established.

Sentencing Reform Could Save Lake County: $150,000

Annually

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• Each RFP/bid requires extensive time on the part of both the County and the local vendor, and can add months to a purchasing process. The bid/RFP requirements can also present challenges for local emerging business.

• Increasing these limits would allow for more efficient purchasing. Suggested increases are: o Commodities – Raise to $50,000 (currently $30,000) o Professional Services - Raise to $100,000 (currently $50,000) o IT Services – Raise to $100,000 (currently $35,000)

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Lawlor Memo on Unfunded Mandates

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