The relatively new city administrator, Blaine Oborn, was only partly responsible for the 2015 Lake Geneva Audit because the budget was done under the tenure of the previous City Administrator (Dennis “I’m still here” Jordan). Blaine’s real financial test will come later this summer, or early into the fall, when he guides the city council in framing next year’s key budget issues. With the closing of TIF, the extra $1.9 million ($1,900,000) that used to automatically roll in will no longer be available, and with much of the city’s two and a half million-dollar windfall from it already allocated, there will be a significant reduction in city revenue for 2017. Also, there are a couple of interrelated spending trends that will need to be addressed.
One is the city’s unfunded “Other Post-Employment Benefit Plan” (OPEB) which is the retirement benefit amount (or pension) for retiring employees between the ages of 55 and social security benefit eligibility. The city’s last OPEB audit was in 2012, and that audit put the unfunded liability owed the plan to be in excess of three million ($3,000,000). This unfunded liability is currently paid for on a ‘pay as you go’ basis, which means that money that should have been set aside for those promised benefits (already spent by previous city councils) is not there. Instead, today’s taxes must be used to pay for those previously promised benefits. There is a liability and cost increase with each additional person added to those benefits as time goes by and the city grows.
With the Lake Geneva’s Fire Department’s plan to expand its payroll by hiring sufficient staff to man a paid on premises operation, that runs 24 hours a day and seven days a week, a major new burden will be placed on the current budget to fund those future OPEB payments, unless that can is just kicked on down the road like it was before. This planned expansion of the Fire Department is primarily being justified as necessary to fully man the city’s ambulatory services. This service was started a few years back when the Fire Department decided to enter into the ambulance service business in competition with the Paratech Ambulance Service. This has caused a substantial increase in the Fire Department’s equipment, staffing and training costs, which will continue to escalate as certified paramedics will soon be required.
Certified paramedics are a lot more expensive than EMT trained firemen. They are necessary, however, to run an effective ambulance service that meets a seven days a week, 24 hours a day, coverage period. The cost of maintaining and upgrading medical equipment, as well as the ongoing training and hiring of certified paramedic personnel to staff a 24 hours a day, seven days a week medical operation may be beyond what the city is capable of doing.
Is Paratech the better solution? The Fire Department’s endeavor in this area has already resulted in delays in ambulatory services, customer double billing for ambulatory service, and the Fire Department’s unpaid ambulatory services that have had to be written off. Utah Blaine Oborn is going to be directly in the line of fire when it comes to making recommendations to the city council to act judiciously and appropriately in reviewing this vital budgetary issue.