1 2 3 4 5 6 7 8 KERR COUNTY COMMISSIONERS COURT 9 Budget Workshop 10 Tuesday, August 3, 2010 11 1:00 p.m. 12 Commissioners' Courtroom 13 Kerr County Courthouse 14 Kerrville, Texas 15 16 17 18 19 20 21 22 23 PRESENT: PAT TINLEY, Kerr County Judge H. A. "BUSTER" BALDWIN, Commissioner Pct. 1 24 WILLIAM "BILL" WILLIAMS, Commissioner Pct. 2 JONATHAN LETZ, Commissioner Pct. 3 25 BRUCE OEHLER, Commissioner Pct. 4 2 1 I N D E X August 3, 2010 2 PAGE 3 Review and discuss FY 2010-11 Budgets and fiscal, capital expenditure and personnel matters related 4 thereto including, but not limited to, cost of living adjustment, salary considerations, staffing levels, 5 health benefits, and insurance 3 6 --- Adjourned 100 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 3 1 On Tuesday, August 3, 2010, at 1:00 p.m., a budget 2 workshop meeting of the Kerr County Commissioners Court was 3 held in the Commissioners' Courtroom, Kerr County Courthouse, 4 Kerrville, Texas, and the following proceedings were had in 5 open court: 6 P R O C E E D I N G S 7 JUDGE TINLEY: Okay, why don't we come to order for 8 this Kerr County budget workshop scheduled for today, August 9 3, Tuesday, 2010, at 1 p.m. It's a bit past that time now, 10 so we'll get started. The agenda item is to review and 11 discuss FY 2010-11 budgets and fiscal capital expenditure and 12 personnel matters related thereto, including, but not limited 13 to, cost-of-living adjustments, salary consideration, 14 staffing levels, health benefits, and insurance. Ms. Hyde, 15 our H.R. director, and Ms. Hargis, our Auditor, have been 16 putting in a lot of long hours working up some -- a number of 17 different options, scenarios, so forth. That's the charge 18 they've been given, and this is something that falls within 19 their financial bailiwicks and so forth. So, at this point, 20 I'm going to turn it over to them and let them run with it a 21 while. 22 (Low-voice discussion off the record.) 23 MS. HARGIS: It's the third handout. 24 MS. HYDE: This second part goes with it. 25 COMMISSIONER BALDWIN: Good lord. 8-3-10 bwk 4 1 COMMISSIONER LETZ: Commissioner, you're back. 2 COMMISSIONER BALDWIN: I'm back. I'm glad you 3 recognized that. 4 COMMISSIONER WILLIAMS: You just noticed? 5 COMMISSIONER BALDWIN: You're going to go a long 6 way in this business. 7 COMMISSIONER LETZ: How was Tennessee? Weren't you 8 in Tennessee? 9 COMMISSIONER BALDWIN: Yeah, I was in Tennessee. 10 It's fantastic. Good time was had by all. I've got painted 11 toenails. 12 COMMISSIONER OEHLER: I heard that. 13 COMMISSIONER WILLIAMS: Tennessee people receive 14 that well? 15 COMMISSIONER BALDWIN: No, they didn't receive that 16 very well at all. (Laughter.) 17 MS. HARGIS: I can't imagine why. 18 COMMISSIONER WILLIAMS: Just thought I'd ask. 19 COMMISSIONER BALDWIN: Didn't go over as big as I 20 thought it was going to. 21 JUDGE TINLEY: Aren't they an inclusive bunch up 22 there? 23 COMMISSIONER BALDWIN: Absolutely. Most 24 closed-minded bunch of people I ever saw in my life. 25 JUDGE TINLEY: Okay, Ms. Hyde. 8-3-10 bwk 5 1 MS. HYDE: Y'all asked for the results of the 2 employee opinion survey. You have to excuse me; my voice is 3 just about gone. I made this real simple. 4 COMMISSIONER LETZ: What are we looking at? 5 COMMISSIONER WILLIAMS: Which one are we looking at 6 here? Okay. 7 COMMISSIONER LETZ: The one that says survey. 8 MS. HARGIS: The one that says survey on it. 9 MS. HYDE: Shhh, don't make them mad to start with. 10 This breaks out the employees that answered. We had 210 11 employees overall that answered. 12 COMMISSIONER WILLIAMS: Pull the mic over so you're 13 talking into it. 14 MS. HYDE: We had 210 employees overall out of 274 15 that answered the survey. Our length of service, if you 16 noticed, it falls right in range with what we've been talking 17 about. Age demographic, it also falls in range. Male and 18 females. Then we get to the plan use cost for the last 12 19 months. I got a little concerned, because we know that the 20 plan has been used more than this, so what it tells me is 21 that perhaps employees do not understand or did not 22 understand the question, 'cause that was total dollars used 23 towards the plan. 24 COMMISSIONER LETZ: Which page are you on, Eva? 25 MS. HYDE: Page 6. 8-3-10 bwk 6 1 COMMISSIONER LETZ: Plan use costs. That was 2 intended to be the amount that each employee used? 3 MS. HYDE: Yes, sir. And we do know that that's 4 not true. So, what I think that they -- maybe they 5 misunderstood it. Maybe this is what they think they used 6 versus how much they actually used. Maybe they don't know 7 how much their claims cost is. 8 COMMISSIONER LETZ: I'd bet it's the latter. 9 MS. HYDE: If you turn the page to Page 7, on HRA 10 reimbursement, this -- this one is also very concerning, 11 because it shows that 87 of the people thought they hadn't 12 used it at all, and we'll get to that. That is not accurate 13 either. 14 COMMISSIONER WILLIAMS: So, what is this going to 15 show us, if all these categories to-date are not 16 representative of what the truth is? 17 MS. HYDE: Well, number one, the employees don't 18 understand the insurance. I think that's one of the things. 19 That it reinforces to all of us that we need to do a better 20 job of making sure they understand a little bit more about 21 the insurance. If you go to the next one, that's where I 22 think the numbers start turning to where they understood the 23 questions point-blank. 24 COMMISSIONER WILLIAMS: Okay. 25 MS. HYDE: 168 people of the 210 do not have other 8-3-10 bwk 7 1 insurance options available to them, and if they did, the 30 2 some-odd that did, why did they choose our plan? Because our 3 plan's cheaper, and because they're the primary provider. On 4 Page 10, they rate the health insurance from average to above 5 average to excellent. We only had six people that said the 6 insurance was poor or very poor. This is where we got to 7 asking the questions. Who do you think and how do you think 8 we ought to reallocate this cost? And as I told y'all 9 one-on-one -- except for you, Commissioner Baldwin, 'cause 10 you were in Tennessee with your painted toes having a great 11 time. 12 COMMISSIONER BALDWIN: So you're telling me that 90 13 percent of the people that responded to this thing say our 14 health insurance is average health insurance? 15 MS. HYDE: 90 people. 16 COMMISSIONER BALDWIN: 90 people? 17 MS. HYDE: Yes, sir. Those are the number of 18 people. 19 COMMISSIONER BALDWIN: Out of how many? 20 MS. HYDE: 210. 21 COMMISSIONER BALDWIN: 210. 22 MS. HYDE: And 70 said that we were above average, 23 and 30 said we were excellent. 24 COMMISSIONER BALDWIN: We are doing a poor job of 25 educating our employees as to what the health insurance is 8-3-10 bwk 8 1 about. 2 MS. HYDE: When we talked to y'all one-on-one, we 3 made sure that everyone understood. If you were an employee 4 only, you're not going to want to raise anything against an 5 employee only. Right now it's zero for the employee. If you 6 are a single provider in a household and you have children, 7 you're not going to want to increase that. And if you have a 8 spouse only, you're not going to want to increase that. No 9 one wants to increase their insurance, and so the question 10 basically just proved that out. Employee only say, 11 basically, charge who is charging us. Where is the dollars 12 coming from? From claims? Then charge who's charging the 13 claims. So, again -- and all I did was keep going. People 14 said that they'd be willing to pay an increase in employee 15 only, but when you look at the cost that they're willing to 16 increase themselves to pay, it was zero. We had two people 17 that said they'd pay $50 a month, and we had three people 18 that said they would pay $100 a month, out of 210. The rest 19 of them said that they would pay zero. 20 If you look at the spouse coverage, same thing. 21 132 of them said no way, José; can't pay nothing. 17 said 22 yes for $100 towards a spouse. When we got to children, they 23 said yes for $100, 16 of them. One said for 150. One said 24 for 200, and the rest were zero. Same thing on the family 25 coverage. Numbers were almost exactly identical. We had 127 8-3-10 bwk 9 1 people said that they would not want to be paying additional 2 deductibles. Some -- we had 36 that said 100, three that 3 said 150, 14 that said 200. There were very few that went on 4 up, but there were a few, which was surprising that they 5 would increase their deductible. No one wants to increase 6 their co-payment for doctors, for the most part. And some 7 said, yeah, they'd go up 10 bucks. And then I thanked 8 everybody for their opinions. 9 This second part is the comments. If you go to the 10 back page, you all can read -- there's six pages worth of 11 comments. Overall, the employees understand there's a 12 problem; however, the overwhelming response was a request for 13 the Commissioners Court to compromise, and if there is an 14 increase to their premium cost, they believe that they need 15 an increase to offset their cost increase. Their 16 quote-unquote "why" is due to the rising costs of health care 17 and increases against their payroll. Overall, employees also 18 believe that any cost increase should go against who is 19 causing the increase in costs -- and their understanding is 20 dependents -- while they still also maintain that a raise is 21 needed to help offset the increase in those costs. Some 22 employees do not understand that during the budget process, 23 options are required by the Court for their consideration and 24 discussion, and that is why we have 8 to 12 weeks of budget 25 workshops. Employees believe that one of the biggest 8-3-10 bwk 10 1 advantages to working for Kerr County is their health care 2 benefits, but also believe they need an increase to offset 3 the continued increase in the cost to live in Kerr County. 4 Employees' opinions were overall very positive, open and 5 honest regarding their beliefs and needs. And employees 6 still seem to be struggling with their take-home pay and 7 paying their bills. And y'all can read the rest of that at 8 your leisure. 9 MS. BOYD: Are there any more copies? 10 COMMISSIONER BALDWIN: You have this statement on 11 here, "I'm so impressed with the current administration's 12 resolution to the rising cost of health care." Is that a 13 statement someone made, -- 14 MS. HYDE: Yes, sir. Those are all comments -- 15 COMMISSIONER BALDWIN: -- or something you said? 16 MS. HYDE: No, sir. Those are all comments -- the 17 first five pages are all comments that the employees made. 18 COMMISSIONER BALDWIN: All right. So when they 19 say, "I'm so impressed with the current administration's 20 resolution to the rising cost of health care," the 21 administration is that Obama bunch? 22 MS. HYDE: Yes, sir. 'Cause at the very bottom, 23 they said, "Not." 24 COMMISSIONER BALDWIN: Mm-hmm. 25 MS. HYDE: So ours -- so, yes, sir, that's what we 8-3-10 bwk 11 1 thought. But we could be wrong. But that's what it appears 2 to be saying. There's some good ones in there. 3 COMMISSIONER BALDWIN: Do you have some more paper 4 to give me? 5 MS. HYDE: Oh, yes, sir, lots of paper. 6 COMMISSIONER BALDWIN: Are we going to be making 7 decisions today? Thank you. 8 COMMISSIONER LETZ: I've already got a headache. 9 MS. HYDE: You asked about the HRA cards, and I 10 told you I'd have to take a snapshot. This is our carry-over 11 as of 1/1 of 2010. Our HRA card cost for 2010 for employees 12 for just 2010 is $241,500. The carry-over from prior years 13 increased that to $363,327. 14 COMMISSIONER LETZ: So the first number is 2010 15 cost, and the second number is the 2010 cost plus the 16 carry-over? 17 MS. HYDE: Yes, sir. 18 COMMISSIONER WILLIAMS: Is the first number just 19 the employee, or is the first number the employee and any 20 family? 21 MS. HYDE: All. All-inclusive. 22 COMMISSIONER WILLIAMS: All-inclusive of that card? 23 MS. HYDE: Yes, sir. 24 COMMISSIONER WILLIAMS: Okay. 25 MS. HYDE: So that would be E.E., spouse, 8-3-10 bwk 12 1 dependents, all. 2 COMMISSIONER WILLIAMS: Okay. 3 MS. HYDE: All-inclusive. 4 COMMISSIONER BALDWIN: "Total balance after C/O," 5 what is that? 6 MS. HYDE: That's the carry-over. That's when we 7 add the carry-over to that original balance. 8 COMMISSIONER BALDWIN: Let me ask my question. 9 What is the time frame there? Where's the cutoff time for 10 that through 2010? 11 MS. HYDE: December 31st -- December 31st, 2009, we 12 cut it. And then we turned it back on 1/1 of 2010 so that we 13 could get the carry-over cost. 14 COMMISSIONER BALDWIN: So this number is through 15 today? 16 MS. HYDE: This is what we did this year. 17 COMMISSIONER BALDWIN: So far this year? 18 MS. HYDE: No. This is the budget -- this is what 19 we need to budget. 20 COMMISSIONER BALDWIN: I see what you're saying, 21 okay. 22 MS. HYDE: I'm sorry, I misunderstood you. I was 23 getting ahead of you. 24 COMMISSIONER BALDWIN: That's fine. I'm with you 25 now. Go ahead. 8-3-10 bwk 13 1 COMMISSIONER LETZ: Now, let me just make sure -- 2 our deductible right now is at 1,000, correct? 3 MS. HYDE: Sorry? 4 COMMISSIONER LETZ: What's our deductible? 5 MS. HYDE: $1,000 for an employee only. 6 COMMISSIONER LETZ: That's employee only. So right 7 now, the way it's actually worded -- I'm saying this really 8 for -- to be sure we're all on the same page. The way it 9 works for an employee is their first $600 of the deductible, 10 they don't pay because they have the HRA card, and then they 11 can -- they pay that -- the deductible doesn't kick in until 12 after the first $600 of expenses. 13 COMMISSIONER WILLIAMS: For those that use it for 14 that purpose. 15 MS. HYDE: Thank you. That's the big issue. 16 COMMISSIONER LETZ: Right, but they can. I mean, 17 they can use it that way. So they can -- so an employee 18 really doesn't have a deductible if they choose to do it that 19 way. 20 MS. HYDE: We have $600 on the card, so they would 21 have $400 out-of-pocket deductible that they would have to 22 pay. 23 COMMISSIONER LETZ: But they don't get to that 400 24 until after their first $600 of expenditures. 25 MS. HYDE: Towards deductible, yes, sir. 8-3-10 bwk 14 1 COMMISSIONER LETZ: I guess -- I thought when we 2 originally started the HRA, the intent was to get people used 3 to spending, like, money on their health -- on their health 4 coverage. We raised the deductible so we'd be doing that, 5 but I think in reality, I'm not sure that was accomplished, 6 because they don't -- for those that are relatively healthy, 7 they don't pay anything. 8 MS. HYDE: Right. 9 COMMISSIONER LETZ: Because you have your -- 10 COMMISSIONER OEHLER: They carry it forward. 11 COMMISSIONER LETZ: Right, and they carry it 12 forward too if they don't use their card. So, if they have a 13 couple of incidental times to go to the doctor, they don't 14 pay anything for their health coverage. 15 MS. HYDE: Right. 16 COMMISSIONER LETZ: And there's -- and I believe 17 when we talked before, there's really not a way to -- to flip 18 that so you're forced -- the 400 comes out of pocket, and 19 then the HRA after that? 20 MS. HYDE: No, sir. 21 COMMISSIONER LETZ: But we can limit what the HRA 22 is used for. 23 MS. HYDE: Yes, sir. 24 COMMISSIONER WILLIAMS: I think that's the only way 25 you attack it, is to limit the utilization of the card. 8-3-10 bwk 15 1 COMMISSIONER BALDWIN: I agree. 2 COMMISSIONER WILLIAMS: One way or the other. 3 COMMISSIONER LETZ: Okay. 4 MS. HYDE: The question y'all asked me was, could 5 we change it where it was deductible only, and the answer is 6 yes, we can. We can change it to deductible only, no 7 co-pays. And it would force -- 8 COMMISSIONER LETZ: So what you're saying, it can 9 only be used for deductibles? 10 MS. HYDE: Yes, sir. 11 COMMISSIONER LETZ: How much -- do we have a number 12 about how much that saves? 13 (Ms. Hyde shook her head negatively.) 14 COMMISSIONER LETZ: Probably we need to give you a 15 packaged scenario; then you'll come back to us. 16 MS. HYDE: Absolutely. 17 COMMISSIONER LETZ: But I think that -- I would 18 like to see -- to me, that makes sense. I think we need 19 to -- 20 COMMISSIONER BALDWIN: We need to at least look at 21 those numbers; I agree with you. 22 COMMISSIONER LETZ: Right. 23 COMMISSIONER BALDWIN: But when she comes back with 24 it, I need to have a wheelbarrow here so I can get all this 25 paper back to my office or somewhere. 8-3-10 bwk 16 1 JUDGE TINLEY: Tim will have you one. 2 COMMISSIONER BALDWIN: Tim's got one. 3 MR. BOLLIER: I got plenty of them. 4 MS. HYDE: You're going to give me a scenario you 5 want me to look at? 6 COMMISSIONER LETZ: That's one -- I think that -- I 7 mean, I don't think, overall, after looking at all these 8 survey results and what we've talked about prior to today, 9 that I'm in favor of just making one change in our plan. I 10 think it's going to be a series of changes. It's going to 11 raise the cost, you know, maybe to dependent coverage of some 12 factor, probably raise the cost to all employees some factor, 13 and HRA card, maybe that way to do that, changing that usage. 14 I think we have to -- I don't want any one group totally. I 15 don't think that's fair. 16 COMMISSIONER OEHLER: Something that I read, I 17 don't know if it's going to hold true or not, how it shakes 18 out, but there's -- you know, there's a limit of how much we 19 can go up on what the employee contribution would be. And 20 whenever you have paid no contribution toward your health 21 care at all, if your cost is zero, how can you increase that 22 amount even by $60 a month? If that's what the -- up in the 23 northeast, their law is going to be. It has said that you 24 cannot raise -- I believe it's more than 10 or 12 percent. 25 MS. HYDE: They've talked about that, Commissioner. 8-3-10 bwk 17 1 And what's happening now is everyone is pedaling extremely 2 fast to get plans in place. The grandfather status is no 3 longer attractive at all, and even if you maintain 4 grandfather for a year, by year two we'll be out of it, 5 because you can't change providers. You don't even have the 6 option to change providers any more. So, everyone's pedaling 7 extremely fast to try to get their plans in line, and then 8 force the issue back from the federal health care reform 9 legislation. 10 COMMISSIONER WILLIAMS: You know, the survey -- the 11 survey should not -- has not revealed anything that should be 12 a surprise to us. 13 COMMISSIONER OEHLER: Hmm-mm. 14 COMMISSIONER WILLIAMS: When you ask the employee 15 group to participate in something that is most beneficial to 16 themselves and to their family, having never participated 17 before, you're going to get the kind of results out of a 18 survey that we've seen today. The majority don't want to do 19 that. There are -- there's a significant group of employees 20 that recognize the need, but they're hopeful that it won't be 21 much of an intrusion, and so I think we have to determine 22 what that involvement is for the employee, and the best and 23 easiest way to do that while mitigating against some of our 24 expenses. You know, you got two or three options, as we 25 know, that we're going to have to figure out which one 8-3-10 bwk 18 1 provides what we're seeking to provide and keep the employees 2 covered to the extent we can. 3 COMMISSIONER BALDWIN: Let me ask you -- this is my 4 third boy-dummy question of the year. I'm -- they allow me 5 three. This is my third and final one. Is -- is this whole 6 thing geared -- the insurance, all this insurance changing, 7 is it all geared toward Obama care? That is going to be -- 8 what is that about? 9 MS. HARGIS: We're trying to be polite. 10 COMMISSIONER BALDWIN: I am not trying to be 11 polite, okay? Obama care, that -- that the key's not even 12 going to turn till 2014. 13 MS. HYDE: Oh, the key starts -- 14 COMMISSIONER BALDWIN: Wait, let me -- so we are 15 going off down that road, which I'm here to tell you that the 16 thing's not going to happen anyway. I'm willing to bet that 17 the thing is not going to happen. That's a big gamble, if we 18 were to take that route, but I am willing to take that 19 gamble, 'cause it's not going to happen. But everything that 20 we're doing is going down that road to meet Obama care. 21 MS. HYDE: Everything that we're trying to show -- 22 I can't give you a yes or a no. What I can tell you is that 23 health care costs are increasing. 24 COMMISSIONER BALDWIN: Okay. 25 MS. HYDE: Regardless. 8-3-10 bwk 19 1 COMMISSIONER BALDWIN: Yeah. 2 MS. HYDE: Whether it's a threat, you know, of 3 something coming down the pike or it is an actual, our health 4 care costs are going to increase in the coming year. 5 September 1st of this year, the first part of the phase goes 6 into effect. I sent out a lot of stuff about that and what 7 kind of hits us September 1, and then what hits us 1/1 of 8 2011. And although the biggest portion -- you have to have 9 everything in place by 2014, and that's when people are going 10 to be breaking the law because they don't have coverage, or 11 we don't have the correct coverage or we don't have the right 12 Cadillac, bronze, silver, whatever they call it by that time. 13 This is to prepare for 2011, but also to keep our eyes on the 14 ball, what could be happening in 2012. Is that a fair -- 15 COMMISSIONER BALDWIN: You answered my question. 16 MS. HYDE: Thank you. 17 COMMISSIONER OEHLER: Well -- 18 COMMISSIONER WILLIAMS: I'm not sure that I've 19 heard all that's been given to us in that -- totally in that 20 context. I thought a lot of what I'd been hearing from you 21 and from the Auditor and others is that the cost to Kerr 22 County to maintain its health care coverage has gone through 23 the roof. 24 MS. HYDE: Yes, sir, it has. 25 COMMISSIONER WILLIAMS: Notwithstanding Mr. Obama 8-3-10 bwk 20 1 or whatever he's about. 2 MS. HYDE: It's both. It's both. 3 COMMISSIONER LETZ: I think what has happened is 4 that the insurance industry saw what they did, and they 5 jacked the rates up because of what they think may be 6 happening and whether -- you know -- 7 COMMISSIONER WILLIAMS: But the only way that 8 affects us, Commissioner, is through our stop loss coverage. 9 COMMISSIONER OEHLER: See, that's where the problem 10 is, is because they took off the cap on -- on any kind of -- 11 you know, used to cap everything. It was 2 million maximum. 12 MS. HYDE: Right. 13 COMMISSIONER OEHLER: Lifetime benefit. The cap's 14 gone, so when you take the cap off, I mean, how can you even 15 estimate what some of your costs may be? 16 COMMISSIONER WILLIAMS: I understand your point, 17 but is everybody at 2 million? 18 MS. HYDE: No. No. It's -- 19 COMMISSIONER OEHLER: No. 20 MS. HYDE: The caps ranged anywhere from 500,000 on 21 up. Our plan has been at 2 million ever since I've been 22 here. 23 COMMISSIONER WILLIAMS: Mm-hmm. 24 MS. HYDE: But what's happened is now, instead of 25 there being those different graduated points where they can 8-3-10 bwk 21 1 say, "Okay, you're at 500,000; here's your cost." It's going 2 to be a little bit less than a million or 2 million or 5 3 million. Now there is no cap, so now what they're going to 4 have to do is put it all in a big pool. 5 COMMISSIONER WILLIAMS: I understand. 6 MS. HYDE: How it's going to spread the risk. 7 COMMISSIONER WILLIAMS: And so our exposure -- 8 MS. HYDE: Is larger. 9 COMMISSIONER WILLIAMS: And it's -- but it's still 10 within the stop loss coverage. 11 COMMISSIONER OEHLER: If you can get it. If you 12 can afford it with no cap. 13 COMMISSIONER WILLIAMS: Am I wrong? Tell me if I'm 14 wrong. 15 MS. HYDE: I don't know that you're wrong, but 16 you've got to hit that stop loss. And if we have -- if these 17 don't hit the stop loss, that's where the claims can kick us. 18 COMMISSIONER WILLIAMS: I understand that, but our 19 stop loss each year is not -- is not predicated on all of our 20 employees going over 2 million. It's over a -- a ceiling 21 that we establish for stop loss insurance. Is that wrong? 22 MS. HYDE: It's $60,000. Once we hit our first 60, 23 then -- then stop loss starts kicking in. 24 COMMISSIONER WILLIAMS: Thank you. You confirmed 25 what I thought I knew. 8-3-10 bwk 22 1 COMMISSIONER OEHLER: Well, there's a difference 2 between stop loss and cap. 3 JUDGE TINLEY: We essentially got two problems. 4 One is we have high claims cost this year, and that alone is 5 enough to cause a significant increase, even if we didn't 6 have the effects of the federal health care legislation. 7 When we couple that with the federal health care legislation 8 that takes the caps off, that enhances the dependency 9 allowance for inclusion as a dependent, your stop loss 10 carriers that insure above our -- whatever our set stop loss 11 amount is, -- 12 COMMISSIONER WILLIAMS: Okay. 13 JUDGE TINLEY: -- they sense they have 14 significantly greater exposure, and they do. And not just 15 because of the federal health care, but also because they're 16 looking at significant claims costs that we have actually 17 incurred, and they're seeing more encroachment into the stop 18 loss coverage, for which there is no limit. 19 COMMISSIONER WILLIAMS: Okay. Okay. 20 JUDGE TINLEY: So, it -- 21 COMMISSIONER OEHLER: Yeah. 22 JUDGE TINLEY: It's the perfect storm, so to speak. 23 MS. HYDE: Right. 24 COMMISSIONER OEHLER: And then, too, you add -- you 25 take away -- you know, you increase the age of dependents 8-3-10 bwk 23 1 that can be on -- 2 MS. HYDE: Oh, yeah. 3 COMMISSIONER OEHLER: -- on our plan. 4 JUDGE TINLEY: That's part of the health care. 5 COMMISSIONER OEHLER: 27 years old, from 23, I 6 believe was what it was. 7 MS. HYDE: From 24. But the other part of that -- 8 I mean, you make a great point. The other part of that is 9 there used to be I.R.S. guidelines on what was a dependent, 10 and those have been whacked away. It is no longer that you 11 have to be a full-time student or -- 12 JUDGE TINLEY: Living at home. 13 MS. HYDE: -- you have to live at home, or 50 14 percent of your welfare is provided by your -- by your 15 parents. That's no longer the case. They threw that out as 16 well. And, you know, I've asked this question. If the 17 I.R.S. can't keep up with the number of dependents, how in 18 the world are we going to keep up with them? What's true and 19 valid? I guess, you know, maybe the Sheriff could put on 20 another investigator just to investigate our -- our dependent 21 status. 22 SHERIFF HIERHOLZER: When does that part take 23 effect? 24 MS. HYDE: September 1. Which is our 1/1 plan. 25 COMMISSIONER BALDWIN: Do we have people in those 8-3-10 bwk 24 1 categories that -- I mean, are we affected by it? 2 MS. HYDE: Yes, sir. We just don't know how much. 3 COMMISSIONER BALDWIN: A large amount? We don't 4 know? 5 MS. HYDE: We don't know how many. Because, for 6 example, let's say you're a -- a parent, and your child 7 spread its wings and went to college, and did like a lot of 8 kids do; they go to college for a year or so, and then they 9 say, "I'm not ready for this," and they drop out. And they 10 have -- and you, as a parent, you tell them, "I was going to 11 take care of you as long as you was in school, but now that 12 you're coming out of school, you need to get a job and take 13 care of yourself." And they filed their first I.R.S. 14 statement that year, and they weren't your dependent. They 15 couldn't get back on dependent status. They were done. 16 That's no longer the case. So, if you have a son or daughter 17 that goes out and does that, and then they go back to school 18 full-time and you start helping them out, they can now -- 19 they can now be on our insurance again. 20 COMMISSIONER BALDWIN: Well, I see that as a horror 21 story, but do we have anyone -- 22 MS. HYDE: We have a lot of single parents that are 23 divorced that have children that are in the 20 to 27 24 year-of-age range that have either gone out on their own, and 25 now they're coming back to school, and now they're really 8-3-10 bwk 25 1 struggling. Because when we did statements and -- tax 2 statements and tried to help people about how -- how to 3 decrease their taxes, that was a huge one for a lot of folks, 4 probably 15 to 20 that I can tell you about. 5 COMMISSIONER BALDWIN: 15 to 20? 6 MS. HYDE: Yes, sir. Because those kids are now 7 going back to school. They got out in the big, bad world and 8 found out "Have it your way" just ain't cutting the bills. I 9 better go back to school. 10 COMMISSIONER BALDWIN: Hell, I still feel that way. 11 I'm 62. (Laughter.) 12 MS. HYDE: So -- but the -- the insurance 13 companies, I think, are just as nervous as everybody else, 14 because they don't know. So, what are you going to do? 15 You're going to maintain your margins. They're going to 16 maintain their margins at whatever cost they need to. 17 COMMISSIONER OEHLER: Well, the whole thing in a 18 nutshell is we got to control our costs that have gone way up 19 this year, and to prepare us, show us what our problem is, we 20 need to deal with that in order to get some of our costs down 21 in order to get some money in the pot to help pay for it. 22 MS. HYDE: This has been our worst claims year 23 in -- since I've been here. I went back and tried to look at 24 the data prior to -- prior to October 1, 2006, and I would 25 not use it, because it's not 100 percent there. But I can 8-3-10 bwk 26 1 tell you that on what Gary has and what he and I have looked 2 at, he can go back four years, and this is our worst claims 3 year. This is like -- I guess like the Judge said, this is 4 like the perfect storm. Everything has hit in this year. 5 But this is our worst claims year as well. Now, is that 6 because we have more dependents? I don't know. I don't 7 know. But we got -- we have some sick people this year, 8 health-wise. 9 COMMISSIONER LETZ: So what options -- what options 10 are you going to recommend? 11 MS. HYDE: We've got the options -- 12 COMMISSIONER BALDWIN: I think the Sheriff had a 13 question, before we get off into options. 14 SHERIFF HIERHOLZER: The only question I have -- 15 and I heard our consultant talk the last time he was in here. 16 Do we have anything yet actually from the insurance company 17 or stop loss of what the increase is really going to be? Or 18 is it just best person's guess, it's going to be 750,000? I 19 mean, is there anything really close that says what has to be 20 made up? Could it be 500,000? Could it be 300? 21 JUDGE TINLEY: Well, the -- the 750,000 gap that 22 you're hearing about is based upon what we know our fixed 23 costs are. 24 MS. HYDE: Right. 25 JUDGE TINLEY: And that includes the stop loss 8-3-10 bwk 27 1 coverage. 2 MS. HYDE: Right. 3 JUDGE TINLEY: Premiums. But it also includes what 4 we're looking at in terms of our claims experience. 5 MS. HYDE: Right. 6 JUDGE TINLEY: For this year. So, it includes both 7 our fixed costs and our in-house claims cost, which are the 8 components of our plan. 9 SHERIFF HIERHOLZER: But it's based on, of course, 10 last year's, I guess -- 11 MS. HYDE: No, sir. 12 SHERIFF HIERHOLZER: You pay it as you go. 13 MS. HYDE: It's this year's. 14 SHERIFF HIERHOLZER: Well, this current year's. We 15 could have a lot better year and it wouldn't be as much next 16 year, or what is the -- how's that work? 17 MS. HYDE: Once your fixed -- once your fixed rate 18 and your stop loss rate is set, that's over -- that's over 50 19 percent, 60 percent of your cost. The rest of it's claims. 20 SHERIFF HIERHOLZER: I just -- I hadn't ever heard 21 any definite numbers, and everybody says it's three-quarters 22 of a million that's got to be made up. I mean, you know -- 23 JUDGE TINLEY: Well, there's all sorts of anecdotal 24 evidence that for those looking at -- at putting plans 25 together, and having conversations with the stop loss 8-3-10 bwk 28 1 carriers, they're being put on notice those rates are going 2 up because their exposure is so much greater. But ours, 3 unfortunately, is probably not going to be just the normal 4 increase, because they're looking at these big claims, this 5 huge amount of claims that we've got this year, which is what 6 they're going to be basing that on. 7 SHERIFF HIERHOLZER: Well, then, I'll ask one 8 question maybe some employees might have based on this, and 9 if it's the stop loss carrier that -- you know, our insurer 10 that does that, would it be better to go out and rebid that 11 part of the insurance? 12 JUDGE TINLEY: We have to bid every year. 13 MS. HYDE: It's bid every year. 14 JUDGE TINLEY: It's bid every year. 15 SHERIFF HIERHOLZER: Okay. 16 JUDGE TINLEY: Yeah, they will not quote you but 17 for one year at a time. No, they wouldn't do that. 18 Unfortunately. 19 COMMISSIONER OEHLER: Well, it's not just the ones 20 that reach the stop loss level. That's not the problem. 21 It's the ones that are -- that the County's paying up to 22 60,000; isn't that right? 23 MS. HYDE: Right. 24 COMMISSIONER OEHLER: Per employee. 25 SHERIFF HIERHOLZER: Yeah. 8-3-10 bwk 29 1 COMMISSIONER OEHLER: And whenever you have 2 multiple employees reaching that level, that's the cost we're 3 talking about, and then this other stuff is on top of that. 4 MS. HYDE: The $60,000 stop loss, I mean, you can 5 look at that as a double-edged sword. The great news is once 6 we hit 60,000, anything over that is reimbursable to us. 7 However, comma, we only have between 10 to 15 people that are 8 hitting that, which tells us that the rest of them are right 9 underneath the threshold. So, you know, if you just take 10 employees only, you know, 274 employees minus 15 -- I'm not a 11 math major, not today -- 260? 260 people. And you take 260 12 people and you average those out at 30,000 a piece, and 13 that's an average. That's where your claims costs start 14 shooting up, 'cause that's all our dollars, and that's what's 15 killing us. 16 COMMISSIONER LETZ: Script Care. 17 MS. HYDE: You asked for Script Care; that one is 18 just for you, and it's all on one page. 19 COMMISSIONER LETZ: But it's small type. 20 MS. HYDE: Very small type, but it made it on one 21 page. If you look down at very bottom, underneath plan cost, 22 it tells you our plan cost this year so far. And this is 23 through July, Commissioner Baldwin. That -- that should help 24 there. It's $287,217. This is our scrip cost, okay? The 25 good news is, our generic has gone up to 63 percent. That's 8-3-10 bwk 30 1 almost a 15 percent increase from where we started this year. 2 COMMISSIONER BALDWIN: That's good. 3 JUDGE TINLEY: Needs to go up about another 12 to 4 15. 5 MS. HYDE: Another 12 to 15. We need to be about 6 80 percent. Some other good news, if you go down to the 7 bottom, the top 10 drugs by plan cost, we still have some 8 that are -- that are large-dollar, but if you look, it's 9 pretty much the same prescriptions month to month to month 10 that are the top 10. So, when you asked what -- what 11 recommendation was I going to make this year about the drugs, 12 this would be my next to go on the list of our alternative 13 tier, or as you and I talked about, Commissioner Letz, 14 perhaps knocking them off completely. But that'll be a 15 Commissioners Court decision. 16 COMMISSIONER LETZ: What's Enbrel? 17 MS. BOYD: Enbrel is a rheumatoid arthritis 18 medication. 19 COMMISSIONER LETZ: That's just -- I'm bringing it 20 up 'cause it's one our number-one drug now, but it's also one 21 that I don't recall on the list previously. 22 MS. HYDE: No, it was not. 23 COMMISSIONER LETZ: And Betaseron? 24 MS. HYDE: Betaseron? I didn't bring my P.D.R. 25 COMMISSIONER LETZ: That's all right. 8-3-10 bwk 31 1 MS. HYDE: Sorry. 2 COMMISSIONER LETZ: This is -- there's several. 3 MS. HYDE: The only one that we have on here that 4 keeps popping up is my favorite, the purple pill. It's still 5 on there. 6 COMMISSIONER LETZ: Nexium, Plavix, and Singulair 7 and Cymbalta. 8 MS. HYDE: And the Singulair. The -- the statin 9 drugs are still showing up. 10 JUDGE TINLEY: We have two options there with 11 regard to that special tier of drugs. We can either increase 12 the co-pay by a dollar amount or tie it to a percentage of 13 cost. 14 MS. HYDE: We can do whatever. 15 JUDGE TINLEY: Or merely put it in a class of drugs 16 that falls outside the plan. 17 MS. HYDE: Yes, sir. Y'all can -- y'all can 18 determine what you want to do with those drugs. They're 19 flexible on that plan; you can change it any way you want. 20 JUDGE TINLEY: You have a question back there? 21 MS. BOYD: When you say that you're, like, putting 22 it outside the plan, you mean that the plan would not pay for 23 those drugs at all? 24 JUDGE TINLEY: Would not cover them. 25 MS. HYDE: Right. 8-3-10 bwk 32 1 MS. BOYD: And do y'all realize how much those cost 2 an individual if they have to pay for them? 3 COMMISSIONER OEHLER: We know how much they cost us 4 now. 5 MS. BOYD: Well, but if you're a patient that has 6 to use those drugs, you know, $3,000 a month is way out of 7 their reach. 8 COMMISSIONER LETZ: Is the -- is the intent here to 9 try to get alternative drugs? 10 MS. HYDE: They call them alternative therapeutics, 11 and it is not necessarily a generic. And we had a large 12 discussion about that last year. 13 COMMISSIONER LETZ: But if there isn't an 14 alternative therapeutic or a generic, -- 15 MS. HYDE: Right. 16 COMMISSIONER LETZ: -- we need to cover it. 17 MS. HYDE: That would be y'all's decision. At this 18 point, even on the alternative tier drugs, the therapeutic 19 drugs, if there -- if there is -- they're not on there if 20 there's not a therapeutic. I mean, we're not putting 21 something on there that doesn't have a therapeutic 22 alternative. 23 COMMISSIONER LETZ: So, all the drugs on here have 24 a therapeutic alternative? 25 MS. HYDE: No, sir, this is the ones that's hitting 8-3-10 bwk 33 1 us this year. The ones that we have right now on the tier 2 have got an alternative. I'm giving you options. I'm 3 figuring you're going to tell me to go back and check and see 4 that all these have alternative therapeutics. 5 JUDGE TINLEY: Therapeutic equivalent? 6 MS. HYDE: Yes, sir. 7 JUDGE TINLEY: I think that's what you just heard, 8 wasn't it? 9 MS. HYDE: Pretty much. 10 JUDGE TINLEY: Drag out your P.D.R. 11 COMMISSIONER BALDWIN: Now -- 12 COMMISSIONER LETZ: And, I mean, I'm not in 13 favor -- if there's not an alternative, I'm not in favor of 14 saying, I mean, it's outside the plan. But if there is an 15 alternative, that's a different story, to me. I mean, you 16 can try the alternative -- 17 COMMISSIONER BALDWIN: And last year when we had 18 this conversation, I heard -- I heard that when you -- when 19 we were talking about we need to go find an alternative, I 20 did that. Are you telling me that there are people -- 21 employees that are not doing that? They still haven't gone 22 to the... 23 (Ms. Hyde nodded.) 24 COMMISSIONER BALDWIN: How do you go about 25 educating those people to go and find an alternative? We 8-3-10 bwk 34 1 don't tell people what to do. 2 MS. HYDE: No, sir, but we've given them 3 information. And so that it wouldn't come from me, or from 4 the County even, we've had Script Care send them 5 documentation and information. We've had them -- encouraged 6 them to talk to their doctor with -- with information. "Take 7 this with you to your doctor." 8 COMMISSIONER BALDWIN: We're going to start having 9 supper parties over at the Judge's house, and send them over 10 there to let -- give him a chalk board and all that stuff. 11 And you can start you an Amway business the same way, too. 12 JUDGE TINLEY: Yeah. We can -- we've got an item 13 in the budget to cover that, as a matter of fact, Buster. 14 COMMISSIONER OEHLER: Well, how -- isn't there a 15 way to find out which drugs do have a therapeutic equivalent? 16 MS. HYDE: Yes, sir. I can have it -- I'll have it 17 to you very quickly. 18 COMMISSIONER OEHLER: And the ones that do not -- 19 absolutely do not have a therapeutic equivalent, we ask to be 20 removed from the list -- I mean, remain on the list? I'm 21 sorry. The ones that do not have a therapeutic equivalent -- 22 MS. HYDE: Right. 23 COMMISSIONER OEHLER: -- would remain, or could 24 remain. 25 MS. HYDE: Could remain. Whatever y'all decide. 8-3-10 bwk 35 1 COMMISSIONER OEHLER: Yeah. 2 MS. HYDE: Yes, sir. 3 JUDGE TINLEY: And we'd have the further option 4 to -- 5 MS. HYDE: To do a separate co-pay, or maybe a 6 percentage. 7 JUDGE TINLEY: Percentage or dollar amount. 8 COMMISSIONER OEHLER: So what I'm getting at is if 9 it does not have a therapeutic equivalent, then what are they 10 going to take? If they don't take that -- 11 COMMISSIONER LETZ: They need to have -- 12 COMMISSIONER OEHLER: They need to have that. I'm 13 with you on that. 14 COMMISSIONER WILLIAMS: Or if their doctor will not 15 put them on a therapeutic. 16 COMMISSIONER OEHLER: Yeah. See, there's the 17 problem, the doctor. The doctors are a large part of the 18 problem, because they prescribe things that don't -- are 19 going to maybe help the drug companies, maybe help 20 themselves. I'm not sure about that. But, you know, it's 21 just -- we have to figure out a way to make this as foolproof 22 as possible, where people get what they need, but not allow 23 things to happen that cost more when there's another drug 24 that is a lot cheaper that can be taken. I don't know how 25 you do that, but, I mean, somehow or another we've got to 8-3-10 bwk 36 1 limit it to the point to where -- because the cost is just 2 too much. 3 JUDGE TINLEY: Well, we -- Commissioner, we created 4 this tier of ones where there are therapeutic equivalents, 5 and we upped the co-pay portion as a means of trying to nudge 6 these folks. We got a little -- little better on our -- in 7 our participation for generic and therapeutic equivalents, 8 but still not where it ought to be. If those that have 9 generic or therapeutic equivalents are merely not covered by 10 the plan, I can assure you, there will be some real depth of 11 discussions between the patient and the doctor, and they will 12 find something that works. 13 COMMISSIONER OEHLER: Yeah, because that didn't 14 work, because as soon as we raised the co-pay, well, the drug 15 companies gave them a coupon to where they would continue to 16 buy it and we had to pay the difference. So, you know, that 17 didn't work. 18 JUDGE TINLEY: Sometimes they force you to it. 19 COMMISSIONER OEHLER: Well, you know, you hate to 20 have to do that, but golly. 21 MR. BOLLIER: I have a question, Judge. 22 JUDGE TINLEY: Yes, sir? 23 MR. BOLLIER: Say you go -- you know, they 24 prescribe a drug, and you -- and you do the generic brand. 25 But you go get the generic brand, and you find out that 8-3-10 bwk 37 1 you're allergic to that generic brand. Then what are you 2 going to do? 3 JUDGE TINLEY: Well, then you and your doctor need 4 to have a discussion and try something else. 5 MR. BOLLIER: I'm just saying, you know, if you're 6 going to make them -- we're going to make them go to the 7 generic brand, but they're allergic to that generic brand, 8 and the only thing that they can take is -- I guess I'm going 9 to call it the -- you know, not the generic brand. 10 JUDGE TINLEY: You're more apt to find an allergic 11 reaction to something that's not a generic, because the 12 chemical compound of a generic should be essentially 13 identical. Therapeutic equivalents is where you run into 14 that, normally. There are other -- generally, if there's one 15 therapeutic equivalent, there's several. And sometimes, 16 depending on the type of medication -- you see it a lot with 17 blood pressure medications, for example. You got to -- you 18 got to move from one -- try it. If that doesn't work the way 19 you want it to, you go to another one. But there's generally 20 an acceptable option out there. Very seldom is there not. 21 MS. HYDE: I think I've answered all the questions 22 and did all the options that you asked for. Now, except 23 for -- I have two takeaways just on this. Look at the 24 scenarios regarding the HRA, and then I'll get with y'all 25 after -- I would like to know kind of where you guys want me 8-3-10 bwk 38 1 to go on the scenario, though. 'Cause -- 2 COMMISSIONER LETZ: Well, I mean, I wrote down four 3 areas that we can address in health care. One on the HRA, 4 just look at not -- can't use it for a co-pay. 5 MS. HYDE: Okay. And you want to see what that 6 would be if we take out the co-pay cost? 7 COMMISSIONER LETZ: Then on the prescription drug, 8 if it's generic or a therapeutic equivalent, it's not on the 9 plan. 10 MS. HYDE: Okay. 11 COMMISSIONER LETZ: And then on employee 12 coverage -- 13 MS. HYDE: Just on the HRA and the Script Care. 14 COMMISSIONER LETZ: Okay, those two things. 15 MS. HYDE: Is there anything else y'all would like 16 me to pull together on HRA or the scrips? 17 COMMISSIONER OEHLER: Look at HRA's for employees 18 only. 19 JUDGE TINLEY: Mm-hmm, that's exactly what I was 20 thinking. 21 MS. HYDE: Employee only? 22 COMMISSIONER OEHLER: Only. 23 MS. HYDE: Okay. 24 COMMISSIONER OEHLER: And -- 25 JUDGE TINLEY: Eliminate carry-over on HRA. 8-3-10 bwk 39 1 COMMISSIONER WILLIAMS: Mm-hmm. Yeah, for sure. 2 COMMISSIONER LETZ: My other two, she told me I 3 couldn't -- we're going to get to those later, I guess. 4 COMMISSIONER WILLIAMS: You don't write fast? 5 MS. HYDE: Commissioner Baldwin, do you have one? 6 'Cause you asked some good questions about the HRA and the 7 scrips. 8 COMMISSIONER BALDWIN: Not at this time, but I'll 9 let you know when I think of it. 10 MS. HYDE: Okay. 11 MS. UECKER: Judge, I just have a comment about 12 eliminating the carry-over on the HRA's. Because, you know, 13 Eva's doing a good job of letting us know that we need to 14 save that for catastrophic events, and if you eliminate the 15 carry-over, then there goes that. 16 COMMISSIONER LETZ: I think it's eliminating future 17 carry-over. I don't think you lose what's in the bank, is 18 how I interpret it. 19 COMMISSIONER BALDWIN: No, she's saying it right. 20 MS. UECKER: That's what I'm saying, though. 21 MS. HYDE: But if we take out the co-pay, if we -- 22 and maybe there's a modulation on the co-pay. Maybe, you 23 know, you have to use it until you've -- until you've used 24 your deductible first, like you're suggesting, and then you 25 could use it for co-pay if you had any carry-over. Because 8-3-10 bwk 40 1 then you get both ends. 2 MS. UECKER: For example, I pay for my co-pay -- I 3 write a check for my co-pay so that I can save that for if 4 I'm in an accident or if I have to have surgery and pay the 5 20 percent, or pay on the 20 percent, because that's what 6 she's always encouraged all of the employees to do. So, if 7 you eliminate that, then there goes that scenario. 8 COMMISSIONER BALDWIN: In my mind, that's the basis 9 of the whole deal. 10 MS. UECKER: Exactly. 11 COMMISSIONER BALDWIN: Is to cause us to think -- 12 instead of running to the doctor all the -- for every little 13 hiccup we have, to save that thing up for when the big one 14 hits us. 15 MS. UECKER: Mm-hmm. 16 MS. HYDE: Right. 17 COMMISSIONER BALDWIN: That's what it was all 18 about, and now -- 19 MS. UECKER: And it does -- it does stop. There's 20 a maximum that you can carry over already. 21 COMMISSIONER BALDWIN: 1,800 or something. 22 MS. HYDE: 1,800 for employee only, $3,000 for any 23 other plan, whether they have children -- 24 SHERIFF HIERHOLZER: You might find, if you 25 eliminate that carry-over, employees are going to use it 8-3-10 bwk 41 1 more, and it's going to cost more on those co-pays and that, 2 because -- 3 MS. UECKER: Exactly. 4 SHERIFF HIERHOLZER: -- they're not going to save 5 it for catastrophic deductible. 6 COMMISSIONER BALDWIN: See, I agree with that. 7 COMMISSIONER OEHLER: The HRA's are a big help to 8 the employees. 9 SHERIFF HIERHOLZER: Yes. 10 COMMISSIONER OEHLER: That is a huge thing, 11 especially doing just exactly what Linda's saying; that, you 12 know, you save that up and you do not use it for things you 13 ought not be using it on. Because it will happen at some 14 point in time; you're going to need it. 15 SHERIFF HIERHOLZER: Yeah. 16 COMMISSIONER OEHLER: And that really is a help, 17 so -- 18 MS. HYDE: The problem is, I think you're going to 19 be surprised when you see the co-pay amounts, how many people 20 are using it for the co-pays. It brings up a great point, 21 and -- and although we've done a great job and there's more 22 and more people that are trying, it's still not enough. 23 COMMISSIONER OEHLER: Yeah. Well -- 24 MS. HYDE: And so -- 25 COMMISSIONER OEHLER: Shouldn't be using it for 8-3-10 bwk 42 1 co-pays, but that's -- 2 COMMISSIONER BALDWIN: Are you saying the co-pays 3 are -- the number's going to be large? 4 MS. HYDE: Yes, sir. 5 COMMISSIONER BALDWIN: Yeah. That may be the 6 answer right there. 7 JUDGE TINLEY: Yeah, that will solve it. 8 MS. HYDE: You asked for information on the CHIPS 9 program, before we get going into... 10 (Ms. Hyde handed documents to the Court.) 11 COMMISSIONER BALDWIN: Do you have any handouts on 12 it? 13 MS. HYDE: No, sir. 14 COMMISSIONER BALDWIN: She's gone to writing in the 15 margin now. 16 MS. HYDE: The request for information, I went 17 ahead and printed these out. I couldn't get them to copy 18 into something usable. This is the information on CHIPS. We 19 have between 14 and 20 individuals that could qualify -- and 20 I said "could" qualify -- for CHIPS. A couple of things that 21 y'all do need to know from a high level, the children have to 22 be 18 or less, which at this point I'm still trying to get 23 someone to tell me why it is that for this federal program, 24 it's 18 or less, but for everyone else it's up to 27. It 25 would stand to reason, to me. I mean, but I'm just a -- 8-3-10 bwk 43 1 JUDGE TINLEY: You just don't understand big 2 government. 3 MS. HYDE: I don't understand government. 4 COMMISSIONER BALDWIN: Yeah. 5 MS. HYDE: There's wonderful pages of -- 6 COMMISSIONER BALDWIN: Are we big government? 7 MS. HYDE: -- of who and how much that follows. 8 So, it tells you the income guidelines. I've gone online and 9 applied myself. It's not that hard. And most of those 14 to 10 20 people could qualify. 11 COMMISSIONER OEHLER: That's for children 18 and 12 under? 13 MS. HYDE: Yes, sir. 14 COMMISSIONER BALDWIN: A Texas resident and a U.S. 15 citizen. 16 COMMISSIONER OEHLER: Uh-oh. 17 COMMISSIONER BALDWIN: I might bring up. And -- 18 MS. HYDE: Or a legal permanent resident. 19 COMMISSIONER BALDWIN: This issue, the citizenship 20 or immigration status of the parents does not affect the 21 children's eligibility. 22 COMMISSIONER OEHLER: See, that just shot it out of 23 the water. 24 COMMISSIONER BALDWIN: It may be soon. 25 MS. HYDE: There you go. 8-3-10 bwk 44 1 COMMISSIONER BALDWIN: I doubt that, but maybe. 2 MS. HYDE: The one thing that I would bring up 3 that -- one of the reasons why Jeannie and I have done a lot 4 of work on how much the cost is and ways that we can do what 5 we -- we're going to recommend and request is that when you 6 look at the exceptions down at the bottom on the very first 7 page, there's a 90-day waiting period. So, the sooner we 8 kind of know where we're headed, the sooner we can try to 9 help some of those employees, if -- if that's the case. 10 COMMISSIONER WILLIAMS: Would it be reasonable to 11 ask if an employee who has a child eligible for CHIPS -- 12 would they want to know whether or not CHIPS program is equal 13 to, better than, or lesser than Kerr County's plan? Might 14 they want to know that? 15 MS. HYDE: Perhaps. 16 COMMISSIONER WILLIAMS: And what would the answer 17 be? 18 MS. HYDE: It's about the same. It's about the 19 same. And, in fact, on some of the children's stuff you get 20 more, because it is -- it is for children. You'll get a 21 little bit more on some of the preventive -- what I call 22 preventive maintenance on children than what we offer. 23 COMMISSIONER WILLIAMS: Okay. 24 MS. HYDE: They've done a better job, because they 25 do all their immunizing and all their primary health care. 8-3-10 bwk 45 1 But when they hit seven, you start looking at -- they call 2 that an adult for immunizations, so it detracts a little bit 3 on their immunizations. The biggest difference that I saw 4 was they pay for their allergy shots, and ours -- ours charge 5 a co-pay every time. 6 JUDGE TINLEY: You don't happen to have another 7 handout, do you? 8 MS. HYDE: Oh, I've got plenty more handouts. 9 We're going to stop for a minute. You got these straight? 10 MS. HARGIS: Mm-hmm. And they have those, and 11 they -- 12 MS. HYDE: You already have these? 13 JUDGE TINLEY: Yeah, mm-hmm. 14 MS. HARGIS: That's facing the audience, and they 15 have it on their laptops. 16 MS. HYDE: Okay. 17 MS. SOLDAN: Again? 18 MS. HARGIS: Again. 19 MS. HYDE: Would you -- it's little, bitty. 20 COMMISSIONER OEHLER: How hard is it, Eva, to sign 21 up for the CHIPS plan to get kids covered? Is it a long 22 process? 23 MS. HYDE: It took me about five minutes to get 24 through the application. There's a couple of things that we 25 can help them with. They want an I.R.S. tax return; however, 8-3-10 bwk 46 1 if you've had a change in your financial situation -- so 2 let's say there's a family, but one of them has lost their 3 job since they filed their tax return for last year. Then 4 they are also taking what they call exception forms, and they 5 would come downstairs, get an official pay stub showing them 6 what their stub is. They would have to sign an affidavit and 7 say that there's one spouse working, and this is what their 8 new would be for this year. And they'll do exceptions on 9 that. 10 JUDGE TINLEY: So you're not totally tied to last 11 year? 12 MS. HYDE: Right. Right. There are exceptions to 13 the I.R.S. rule, a lot. It didn't take that long. 14 MS. BOLIN: And, Eva, once the application is 15 filled out, how long does it take them to find out whether 16 they'll be covered? 17 MS. HYDE: The ladies that I talked with -- 'cause 18 I called, and that was the hardest part, 'cause you have to 19 wait. And I'm not real patient, so I put it on speakerphone 20 and did other stuff, and lost them once or twice 'cause I was 21 out of the office when they said hello. You only get one 22 shot, so -- but it was normally 15 to 20 minutes to get a 23 live body. And then everyone that I talked to said it would 24 be 5 to 10 business days. But right now, what everybody 25 needs to kind of understand is, other people -- we're not -- 8-3-10 bwk 47 1 we're not the smartest tools in the toolbox. Other people 2 are thinking about this too, so those are -- those are kind 3 of like -- could be longer. But that's why we're really 4 wanting to know who, because we'd like to get going by the 5 end of August, 'cause that gives us September, October, 6 November, three months. If there's an "oops," we can still 7 get it fixed. 8 COMMISSIONER BALDWIN: Where -- and CHIPS, 9 C-H-I-P-S, tell me what that stands for. 10 COMMISSIONER WILLIAMS: Children's Health Insurance 11 Program. 12 COMMISSIONER BALDWIN: What is C-H-I-P-S? 13 Children -- 14 MS. HYDE: Children's Health Insurance Program. 15 COMMISSIONER BALDWIN: He just said that. Is 16 that -- is that part of the Medicaid program? 17 MS. HYDE: Yes, sir. It used to be that the 18 federal government -- 19 COMMISSIONER BALDWIN: It's the federal -- all 20 federal? 21 MS. HYDE: The State of Texas used to be reimbursed 22 by the federal government, so the state of Texas could say, 23 "Okay, here it is." And they would allow it, and the state 24 would incur that cost, and then they would send that cost 25 that they have incurred to the federal government, who would 8-3-10 bwk 48 1 reimburse the state. Now what has happened is the state is 2 an intermediary, and we would -- we would have to spend that 3 first, and then we would request reimbursement from the 4 federal government. 5 COMMISSIONER BALDWIN: How long has that been going 6 on? 7 MS. HYDE: They changed it about four months ago, 8 after the federal health care legislation reform act passed. 9 COMMISSIONER BALDWIN: We may or may not be 10 reimbursed. 11 COMMISSIONER WILLIAMS: Well, they're taking the 12 state out of it, basically, right? 13 MS. HYDE: Yes, sir. And there was a cap to how 14 much the federal government would reimburse the state. It 15 was a program. 16 COMMISSIONER LETZ: We don't qualify as a -- state 17 employees? 18 MS. HYDE: No, sir. 19 COMMISSIONER LETZ: Our employees don't? 20 MS. HYDE: No, sir. And on that other one right 21 underneath it about the E.R.S., I've been trying to get 22 someone to answer me about that, and no one will answer me. 23 Because the way it reads, if you were dropped -- if the 24 children were dropped off an E.R.S. plan, which is a state 25 plan, then they're not eligible. So, that doesn't make sense 8-3-10 bwk 49 1 to me either. 2 COMMISSIONER BALDWIN: And CHIPS is up and running 3 and available today? 4 MS. HYDE: Yes, sir. It has been for many, many, 5 many years. 6 JUDGE TINLEY: The enrollment and -- and 7 qualification is now on an annual basis, as opposed to 8 semiannual? 9 MS. HYDE: Well, after we talked the last time, I 10 called again, and now I've got the head daddy rabbit in 11 Austin, and what she says is they're getting ready to change 12 it. It's going to go back to quarterly. And so what you 13 have to do is basically show -- and it's -- it used to be 14 that way, and they're going to go back to that because so 15 many people's changes -- their income changes that quickly. 16 And if it's a single spouse working -- I mean a single 17 person -- that's not what I'm trying to say. If a family -- 18 there's only one of them working, that can change quickly, so 19 if the other person goes to work, now you have two; that's 20 going to change those numbers. 21 JUDGE TINLEY: Okay. Okay. 22 MS. HYDE: We're on Page 3 of the salary and group 23 insurance presentation. What we did is we took 14's, 15's, 24 and 16's, which is the bulk of our employees. 25 COMMISSIONER BALDWIN: Page what? 8-3-10 bwk 50 1 MS. HYDE: Page 3. 2 COMMISSIONER BALDWIN: Reduction of income? 3 MS. HYDE: Yes, sir, reduction of income. 4 (Low-voice discussion off the record.) 5 MS. HYDE: All right. On the reduction of income, 6 we tried to make it real simple. The first one is a 14, and 7 if you go across to the right, proposed new insurance cost is 8 going to tell you -- if it's in parentheses, that's a 9 reduction in what the employee will take home. Proposed at a 10 3 percent increase -- 11 COMMISSIONER LETZ: Wait, wait, wait. This is 12 assuming those -- the things up on the top of the page? 13 MS. HYDE: Yes, sir. 14 COMMISSIONER LETZ: The employee only -- 15 MS. HYDE: Is $55. 16 COMMISSIONER LETZ: A month? 17 MS. HYDE: A month. Employee and spouse is $240 18 plus the $55. Employee and child or children is $250 plus 19 the $55. And employee and family is $450 plus the $55. 20 COMMISSIONER LETZ: Okay. 21 COMMISSIONER BALDWIN: The employee and children, 22 250 plus 55 -- 55 per child? 23 MS. HYDE: For the employee. 24 COMMISSIONER BALDWIN: For the employee. 25 MS. HYDE: Yes, sir. These are the options -- 8-3-10 bwk 51 1 these are some of the options that y'all asked me to go back 2 and do. 3 COMMISSIONER LETZ: Okay. 4 MS. HYDE: And then if you go to the second page, 5 on the hard copy -- I don't know about going backwards and 6 forwards in this. That second one is the 300, 300, 600, plus 7 the $60 towards the employee. That way you can see the 8 difference across the board if we have an increase to the 9 employees, whether they're 14's, 15's or 16's. As you can 10 see, with no increase, no raise, there will be a decrease in 11 what they take home. 12 COMMISSIONER BALDWIN: Say that last sentence 13 again, please. 14 MS. HYDE: There will be a decrease in what they 15 take home. So, if they're used to taking home $800 a 16 paycheck, that's what their paycheck was, they're going to 17 have a decrease. 18 COMMISSIONER WILLIAMS: These numbers in 19 parentheses are annualized, correct? 20 MS. HARGIS: Yes. 21 MS. HYDE: Yes, sir. 22 COMMISSIONER WILLIAMS: So an employee at the 14.2 23 with -- in Column Number 3, proposed 5 percent plus 24 insurance, their net take-home pay would be $2,039 less? 25 MS. HYDE: I'm sorry, where are you at? Which one 8-3-10 bwk 52 1 are you on? 2 MS. HARGIS: No, each -- 3 COMMISSIONER WILLIAMS: I don't know. 4 MS. HARGIS: Each column -- the first column, 5 proposed new insurance, is the -- is at their current pay. 6 COMMISSIONER WILLIAMS: Mm-hmm. 7 MS. HARGIS: No increase, no raise. That's if you 8 put these rates into effect. The second column is a proposed 9 3 percent increase in their salary plus the insurance. 10 COMMISSIONER WILLIAMS: Okay. 11 MS. HARGIS: The third column is a 5 percent 12 increase plus their insurance. So you can see in most 13 areas -- 14 COMMISSIONER WILLIAMS: Okay. 15 MS. HYDE: You were on Page 2, I'm sorry. Yes, 16 sir. On your 2,039, what you were saying -- 17 COMMISSIONER WILLIAMS: Where are you? 18 JUDGE TINLEY: On the 55, yes, sir. 19 COMMISSIONER WILLIAMS: That same difference, 14 -- 20 1,452, 925, and 508? 21 MS. HYDE: Yes, sir. 22 COMMISSIONER WILLIAMS: Okay. 23 MS. HYDE: So a 14.2, even with a 5 percent 24 across-the-board, that would be $508.08 less take-home 25 annual. 8-3-10 bwk 53 1 COMMISSIONER WILLIAMS: If we charged the employee 2 $55, et cetera, et cetera, et cetera, those scenarios at the 3 top, right. Okay. 4 MS. HYDE: Yes, sir. 5 COMMISSIONER WILLIAMS: Got you covered. 6 MS. HYDE: Which is $42 a month. They would be -- 7 they would be losing $42 a month. And that's on the family 8 plan. On the employee and spouse, as you can see, it's a 9 negative on the new without an increase. With 3 percent, 10 it's still a negative, and on 5, it's a positive. 11 JUDGE TINLEY: Are you onto 60 now? 12 MS. HYDE: No, sir, I'm still on the front one. 13 JUDGE TINLEY: Okay. 14 COMMISSIONER BALDWIN: Wait a minute. Front one, 15 negative. Y'all -- 16 COMMISSIONER WILLIAMS: Employee only, $55. 17 MS. HYDE: Employee only, 55. 18 COMMISSIONER WILLIAMS: At the top. 19 COMMISSIONER BALDWIN: Okay, I'm there. 20 COMMISSIONER WILLIAMS: That scenario there. 21 MS. HYDE: It's important to remember that in both 22 of these, the employee and spouse, it stayed at 240. That's 23 what it's been. The employee and child or children went up 24 to $250 from 129, so that's the difference. That's why -- 25 that's why you see on the employee family and the employee 8-3-10 bwk 54 1 children that there's a negative result. 2 COMMISSIONER BALDWIN: Tell me about the positive 3 result again on the employee and spouse on the five-year 4 plan. 5 MS. HYDE: On the 5 percent. 6 COMMISSIONER BALDWIN: I mean 5 percent, yeah. 7 MS. HYDE: On a 14.2, the employee/spouse, it's 8 going to cost them $240 plus $55, which is $295. It used to 9 cost them 240 because the employee was free. If we -- if we 10 award a 5 percent across-the-board raise, then the person 11 will see a net increase for the annual pay of $383. 12 COMMISSIONER BALDWIN: So you're going to pay me 13 more, $383? 14 MS. HYDE: You're not a 14.2, sir. 15 COMMISSIONER BALDWIN: All right. John Hook down 16 the street that's a 14.2. 17 MS. HYDE: Yes, sir. They would all actually have 18 a little bit of an increase for the year. 19 COMMISSIONER BALDWIN: And then another employee 20 and his family, it's going to cost them $508 more. And 21 you're going to give the employee and the spouse an increase, 22 or an employee only an increase. And that's the way it is 23 all the way down the line? 24 MS. HARGIS: Yeah. It depends on the premium. 25 Every -- the employees have not paid $55 before, so that -- 8-3-10 bwk 55 1 that's an increase to everyone. The employee and spouse, 2 $240 a month is the current premium. The employee and 3 children, the current premium is 129. The employee and 4 family right now is 359, so there is an increase on each one 5 of those tiers, plus the $55. So, it fluctuates, depending 6 upon the proposed increase, whether it be 3 percent or 5 7 percent, because it's a pretty large increase. The 3 percent 8 doesn't affect most of them at all. When you get to a 5 9 percent increase in salary, it sort of offsets it, but it's 10 not a great amount. 11 COMMISSIONER BALDWIN: Okay. Let me ask you -- 12 golly, boy-dummy question. I'll have to take one from next 13 year, sorry. These numbers at the top, employee only, $55. 14 MS. HYDE: Yes, sir? 15 COMMISSIONER BALDWIN: You know, and then employee 16 and children, 250 plus 55. 17 MS. HYDE: Right. 18 COMMISSIONER BALDWIN: I thought it was 129. 19 MS. HYDE: 129 -- it was 129 for employee and -- 20 COMMISSIONER BALDWIN: When did it change? When 21 did that change? 22 MS. HARGIS: It didn't. 23 COMMISSIONER BALDWIN: Just in the last few 24 minutes? 25 MS. HARGIS: This is a proposal. 8-3-10 bwk 56 1 COMMISSIONER BALDWIN: This is a proposal that 2 y'all are proposing. 3 JUDGE TINLEY: An option. 4 MS. HYDE: An option. 5 COMMISSIONER OEHLER: An option we asked for. 6 MS. HYDE: These are one of the options that y'all 7 asked for while you were gone. 8 COMMISSIONER BALDWIN: That I asked for while I was 9 gone? 10 MS. HYDE: No, sir -- well, while you were gone. 11 COMMISSIONER BALDWIN: I'm here. Are there -- I 12 haven't been all the way through this thing. Are there more 13 options? 14 MS. HYDE: We just gave you two options. We've 15 done, like, 13 or 14 different options, and I don't have 16 enough Kevlar. 17 COMMISSIONER BALDWIN: Do you think that you and I 18 could get -- be alone and -- 19 MS. HYDE: Absolutely. 20 COMMISSIONER BALDWIN: Yeah. 21 MS. HYDE: Absolutely. 22 COMMISSIONER BALDWIN: I won't tell your daddy. 23 And you can tell me how you arrived at the employee and 24 children, the 250 plus 55. 25 MS. HYDE: Yes, sir. 8-3-10 bwk 57 1 COMMISSIONER BALDWIN: As opposed to 129. 2 MS. HYDE: Yes, sir. 3 COMMISSIONER BALDWIN: Catch me early in the 4 morning so I'll have an open mind about these things, 'cause 5 that's really going to be a stretch. 6 MS. HYDE: Okay. 7 COMMISSIONER LETZ: I think the answer is that it's 8 to come up with -- we're at 129 right now, correct? 9 MS. HYDE: Right. 10 COMMISSIONER LETZ: To cut the cost, we went up on 11 the number. That's the bottom line. And it's a -- just a 12 random number, how she got there. She could have picked 13 three -- 14 MS. HYDE: It's not a random number; we did it on 15 ratios. It's a three-to-one ratio right now on dependents to 16 employees, and we looked at it and we've talked about it. I 17 gave you the option that y'all asked for. Charges per 18 capita, which is each child. I did that, and lord have 19 mercy. You know, or charges for an increase in the 20 employees -- employee only. And that's when we did the 21 survey. Like Commissioner Williams said -- I don't mean it 22 to be ugly, but at the same time, if I'm an employee only, 23 I'm going to vote nothing for me, and charge the people that 24 are doing it. If I'm a spouse -- if I have a spouse, I'm 25 going to say huh-uh, spread that wealth. And if I have 8-3-10 bwk 58 1 children, I'm going to say spread that wealth. That's just 2 human nature. So, we went back and we used numbers and we 3 tried to do it by what the numbers are showing us and what we 4 showed y'all. There's a difference in the claims amounts for 5 dependents by almost three to one. The spouses have been 6 paying 240 since I've been here. That's a higher cost. 7 Employees were paying nothing, and for child or children it 8 was 129 on a cost of anywhere from $700 to $850 per capita, 9 per person, on our insurance. So, that's a huge difference, 10 and that's a huge supplement that we were doing for children 11 versus a spouse, and that -- that's the rationale. 12 COMMISSIONER LETZ: Explain to me, employee/family 13 in the 14.2. It's negative $1,452.23, correct? 14 MS. HYDE: Right. 15 COMMISSIONER LETZ: How do you get there? If it's 16 450 a month -- or basically $505 a month, how do you -- 17 MS. HARGIS: That's net. 18 MS. HYDE: It's $505. This is net for the year. 19 MS. HARGIS: That's net after their taxes. 20 MS. HYDE: We figured taxes, everything. 21 MS. HARGIS: Everything's in here. That's their 22 actual take-home pay, after they pay income tax, their -- 23 MS. HYDE: All their taxes, -- 24 MS. HARGIS: -- retirement, -- 25 MS. HYDE: -- retirement, everything. 8-3-10 bwk 59 1 MS. HARGIS: -- everything. 2 COMMISSIONER WILLIAMS: They'd have a net loss 3 of -- 4 MS. HYDE: Yes, sir. 5 COMMISSIONER WILLIAMS: -- 1,452? 6 MS. HYDE: Yes, sir. We wanted to show apples for 7 apples. 8 COMMISSIONER LETZ: Even though it's costing the -- 9 the numbers up at the top corner are per-month, correct? 10 MS. HYDE: Yes, sir. 11 COMMISSIONER LETZ: So it's costing the employee 12 and family $505, but because that's a -- you deduct that from 13 the taxes, -- 14 MS. HYDE: Pre-tax. 15 COMMISSIONER LETZ: -- it's a pre-tax number, the 16 actual cost is only 1,400 -- 17 MS. HYDE: Annualized. 18 COMMISSIONER LETZ: Annualized. 19 MS. HYDE: Yes, sir. 20 MS. HARGIS: The other element is that the federal 21 taxes are going up as of January 1. 22 MS. HYDE: Right. 23 MS. HARGIS: So in the 3 percent and in the 5 24 percent, you have that -- that increase. So the taxes -- 25 taxes are actually increasing, and so you have two elements 8-3-10 bwk 60 1 reducing their net; increased withholding, -- 2 MS. HYDE: Right. 3 MS. HARGIS: -- plus you have the insurance. 4 COMMISSIONER LETZ: So the employee would have -- 5 basically, that first category would have a -- paycheck would 6 be about a little over $100 a month less than it used to 7 right now. 8 MS. HYDE: Right. 9 COMMISSIONER LETZ: With no salary increase. 10 MS. HYDE: With no salary increase, yes, sir. 11 COMMISSIONER LETZ: Okay. 12 COMMISSIONER BALDWIN: Okay. Still on the 14.2 13 employee and children, with a proposed 5 percent increase, is 14 a negative 819.44. 15 MS. HYDE: Yes, sir. 16 COMMISSIONER BALDWIN: What is it today? 17 MS. HYDE: It's $129 a month. It costs them $1,548 18 a year for themselves, and whether it's one child or multiple 19 children. 20 COMMISSIONER BALDWIN: Okay, thank you. 21 JUDGE TINLEY: I had a question here first. 22 MS. BOLIN: Yes. Is the 250 still going to be per 23 child? So if they have two children, then it will be -- or 24 is it 250 for all the children? 25 COMMISSIONER LETZ: No, it's all children. 8-3-10 bwk 61 1 MS. HYDE: All children. Child or children. 2 MS. BOLIN: Okay. 3 MS. BOYD: I guess I'm going to ask a girl-dumb 4 question, but why, if you -- if you're -- if the insurance -- 5 if you're going to raise insurance and then you're going to 6 go back and pay -- I guess I don't understand how that -- 7 like, if you're going to raise our salaries and stuff, why 8 can't we just not raise salaries? How come that doesn't 9 balance out? I mean, I guess -- I don't know if that's a 10 dumb question or not, but -- 11 MS. HYDE: What we looked at was if you look at 12 that first -- that first column, those are all negatives. 13 Those are all losses to employees' take-home pay, every bit 14 of that. And the first option that I was asked to return was 15 there was going to be no way that we could make $750,000 16 appear to put in the budget, so that first line is showing 17 the Commissioners Court that if we do not do something for 18 the employees, that is what the employees are going to take 19 home less in their paychecks. 20 COMMISSIONER LETZ: But what Laurinda's asking -- 21 it's a good question, Laurinda. What Laurinda's asking is if 22 we're going to -- to offset the cost of the employees, we're 23 going to raise all their salaries, why not do neither one? 24 MS. BOYD: Right, that's my question. 25 COMMISSIONER LETZ: Because how is it -- how is the 8-3-10 bwk 62 1 County financially -- we're not making up the 750,000 we're 2 trying to make up if we give it all back in pay raises. 3 MS. BOYD: Right. And I think a lot of employees 4 have that spin of thought. 5 COMMISSIONER BALDWIN: That is a good question. 6 MS. BOYD: I'm no financial whiz, but, you know -- 7 COMMISSIONER BALDWIN: Oh, I think you are, lady. 8 MS. BOYD: Oh, no. No. No, trust me, that's not 9 my strong suit. 10 MS. HYDE: Because keep in mind, gentlemen, that 11 y'all said we weren't going to increase taxes for $750,000, 12 and asked me where to find it. 13 COMMISSIONER LETZ: Right. 14 MS. HYDE: So that -- that was the answer. 15 MS. BOYD: Right. 16 MS. HYDE: I was asked to find 750,000. 17 MS. BOYD: I know that. No, I understand that. I 18 just was asking -- that just kind of popped in my brain. 19 MS. HYDE: So my deal is that if we're going to ask 20 the employees to come up with $750,000, that's why I asked 21 for a 5 percent across-the-board, 'cause that almost covers 22 it. 23 COMMISSIONER LETZ: But that's not -- 24 MS. BOYD: So we're in the same boat. 25 MS. HYDE: We're still in the same boat. 8-3-10 bwk 63 1 COMMISSIONER LETZ: Didn't help us. 2 COMMISSIONER WILLIAMS: Still hasn't done anything 3 for our budget. 4 MS. BOYD: Right. 5 MS. HYDE: Nope, and it won't. 6 MS. BOYD: Can I say something as a person that 7 costs y'all money, I'm sure. But, you know, I -- I worry 8 about our -- I think we all worry about our bottom line, but 9 then, like, I look at, you know, our secretary at the office 10 who has children, and then I see how much it's going to cost 11 them, you know. I don't know how young people these days do 12 what all they do, pay for child care just to work out health 13 care. I -- you know, I just -- I don't think any way you 14 look at it, it's a winning situation, unfortunately. 15 COMMISSIONER WILLIAMS: That's why we're doing this 16 exercise, because there is an impact on employees, and it can 17 be greater or lesser depending on where they are on the 18 chart. 19 MS. BOYD: Yeah. 20 COMMISSIONER WILLIAMS: In the matrix. 21 MS. HARGIS: Go to the next slide. The next -- 22 MS. HYDE: The next slide, we left that one, 23 because that was the first option with the 5 percent. If you 24 look at 5 percent on 300, 300, plus the 60, this is the net. 25 There -- there is no -- there is no positive until it's 8-3-10 bwk 64 1 employee only, because the employee is only going to pay a 2 net of anywhere between $600 and $800 a year. So, the 3 employee only would see a little bit of an increase, but when 4 you look at families or spouses or children, it's a net 5 decrease, and it's larger than the other one. 6 COMMISSIONER LETZ: Why -- why didn't you do -- you 7 probably did do, but why didn't we look at an option 8 somewhere along the line of employees pay $20 a month and 9 200, 200, and 400? I mean, a smaller -- 10 MS. HYDE: We did, and there wasn't enough to make 11 up the 750. 12 COMMISSIONER LETZ: Okay. How much of it could you 13 make up? 14 MS. HYDE: Well -- 15 MS. HARGIS: Not very much. 16 MS. HYDE: Not much. 17 COMMISSIONER LETZ: Not much? 18 MS. HYDE: The numbers that we came up with are the 19 lowest numbers that we can try to make up with to get what -- 20 what we need. 21 MS. HARGIS: Option 1 -- 22 MS. HYDE: That's -- 23 MS. HARGIS: Option 1 gets us within 400,000. 24 You're still not -- 25 MS. HYDE: We're still not even there. 8-3-10 bwk 65 1 MS. HARGIS: You're not there. Option 2, which is 2 the 600, gets you within 100,000. 3 MS. HYDE: 100,000. 4 COMMISSIONER LETZ: Okay. 5 COMMISSIONER OEHLER: Remind me again what the 6 total amount was that was paid for dependent claims? 7 COMMISSIONER LETZ: Two-thirds of the total, wasn't 8 it? 9 MS. HYDE: It's 800 some-odd thousand. 10 COMMISSIONER OEHLER: 850,000, 845, something like 11 that? 12 MS. HYDE: Versus a hundred some -- 13 COMMISSIONER OEHLER: There's your $750,000 right 14 there. That's a cold way to look at it, but, I mean, if you 15 eliminate those, you eliminate the problem. But they still 16 have a problem. 17 COMMISSIONER LETZ: Well, you'd eliminate them, 18 except that you basically have a group of employees that 19 can't afford to be here. 20 COMMISSIONER OEHLER: Yeah, that's right. On the 21 other hand, you know, can't have taxpayers responsible for a 22 whole family because they have one person that's employed by 23 Kerr County. It's just -- that's kind of the devil's 24 advocate way of looking at it, but, I mean, it's just -- it 25 kind of gets to that point. We didn't cause this. 8-3-10 bwk 66 1 MS. HYDE: But neither did the employees. 2 COMMISSIONER OEHLER: And we're supposed to fix it. 3 JUDGE TINLEY: Is it not increasingly clear that if 4 we're going to fix it so as to keep the employees whole, as 5 it were, that we need to seriously consider that we may have 6 to increase taxes? 7 MS. HYDE: I mean, I don't -- I don't -- 8 JUDGE TINLEY: It's real easy to say, you know. 9 And politically, you know, it might be the smart thing to do, 10 but is that in the best interests of the taxpayers? This is 11 the tip of the iceberg. 12 COMMISSIONER OEHLER: I know. 13 JUDGE TINLEY: It's going to get worse from here. 14 So, if -- if we continue to bandaid and rob Peter to pay 15 Paul, we're going to find ourselves in the ditch big time if 16 we don't come up with some sort of a fix. 17 MS. HYDE: I know it's not a popular -- I know it's 18 not popular at all. But there comes -- just like we've 19 talked about during the last three years that I've been here, 20 when we talked about raises, one of the things that we talked 21 about -- and Commissioner Baldwin hit it many times. When we 22 start talking about giving these employees an increase, it 23 was to make them whole, not to make them the highest paid 24 ducks in the pond, 'cause they're not. It was to try to keep 25 them within range, because we need good employees. We need 8-3-10 bwk 67 1 to have employees that can live here in Kerr County. On the 2 flip side, I understand from the public -- I pay taxes. I do 3 pay taxes. But on the flip side, Jeannie's got her own 4 thunder and lightning with her presentation, but we've lost 5 $3.95 million in revenue. And during the last two -- two 6 years, the elected and appointed officials reduced their 7 expenses so that we could give raises without increasing 8 taxes. We reduced our expenses and maintained them so that 9 we wouldn't have to ask the public for money. We didn't -- 10 we did not increase personnel. In fact, through attrition, 11 we didn't -- we didn't replace them; we reduced the number of 12 personnel, and we continue to do that. And so, yes, sir, I'm 13 a little intense right now, so I'll just rewind a bit. 14 Commissioner, your question was claims paid on 15 dependents was $831,346.17, versus employees, which was 469. 16 That ratio is three to one. So, each year that I've been 17 here, we've increased the cost that the County has paid 18 towards insurance about $200,000. Just -- so I'm asking for 19 that 200,000, and I'm asking for another 200,000 for this 20 HRA, and I'll bring you back some stuff to show you on the 21 HRA, but we need to keep these employees as whole as we can. 22 And that's my -- that's my opinion. Because if not, they're 23 going to look elsewhere. They're going to have to. Next 24 slide. CHIPS we already went over. The big thing on that 25 is, it has to be 18 years or younger. Still won't give me 8-3-10 bwk 68 1 clarification on how come they can do it for 18 and we got to 2 do to 27. They don't like that question. We just did 3 salaries. 4 MS. HARGIS: Well, this is the salary -- this is 5 the end. 6 MS. HYDE: I hope it's the end. 7 (Low-voice discussion off the record.) 8 MS. HYDE: Okay, a lot of discussion about this as 9 well. Increased responsibilities for appointed officials. 10 We requested that the I.T. Manager get an additional 7.5 11 percent to bring him up to 62,655. The rationale is -- 12 rationale is, we continue to grow. We continue to use the 13 technology. And throughout this area, that is one of the 14 lowest. We're just asking to bring him up. On Maintenance, 15 we're asking to bring him up as well. We've got a new 16 building. He has not asked for any new people until this 17 year. He is asking for one additional person this year, but 18 he's got a lot of buildings and a lot of square footage that 19 he has to help take care of. Environmental Health, an 20 increase for him as well. When Environmental Health first 21 started back up about three years ago, their claims and cases 22 were a lot lower than they are now. As the public has gained 23 trust in that office, they continue to ask for more and more 24 information, more and more investigations, and more and more 25 case load. For Animal Control, a lot of people don't 8-3-10 bwk 69 1 understand that Animal Control is also -- is not just for the 2 county; we also take care of Kerrville city, the city of 3 Ingram, and basically all of Kerr County, any city within 4 Kerr County. It's the whole darn shooting match. As far as 5 H.R. and the Auditor, we ask for an additional 10 percent 6 because of the increased job responsibilities for your 7 externals and the external staffs, which are your D.A.'s, 8 your J.D.'s, your J.P.O's, and your district staff. 9 COMMISSIONER WILLIAMS: So you're saying the total 10 of all that's 35,000? 11 MS. HYDE: $35,000, yes, sir. Next. 12 COMMISSIONER WILLIAMS: Plus the roll-ups, another 13 66. 14 MS. HYDE: Lord have mercy. Okay, that one's 15 little bitty; I can't read it. I'll have to read it off the 16 paper. On elected officials, we've requested for the County 17 Judge to have an $18,000 supplement, which I reviewed the 18 last time, which is for M.H.M.R., probate, and juvenile. If 19 we did not have a lawyer in that position, then all of those 20 cases can go to other -- to the other court, which would be 21 County Court at Law. 22 COMMISSIONER BALDWIN: What? 23 MS. HYDE: Could be County Court at Law. 24 COMMISSIONER BALDWIN: If you don't have a lawyer 25 where? 8-3-10 bwk 70 1 MS. HYDE: As the County Judge. 2 COMMISSIONER BALDWIN: Yeah, okay. 3 COMMISSIONER OEHLER: They could, but they don't 4 have to. 5 MS. HYDE: They can. 6 COMMISSIONER LETZ: That's going to get rid of a 7 lawyer and we get money. 8 COMMISSIONER BALDWIN: Yeah, that is true. And I 9 understand that. But how many lawyers -- I mean, how many -- 10 yeah, how many lawyer county judges are there -- 11 MS. HYDE: Not many. 12 COMMISSIONER BALDWIN: -- in 254 counties? 13 MS. HYDE: Not many. 14 JUDGE TINLEY: Runs anywhere from 30 to 35, 15 roughly. 16 COMMISSIONER BALDWIN: Probably, but I'm there. 17 I'm not arguing that point, but I'm fixing to argue another 18 one. 19 MS. HYDE: On the -- 20 COMMISSIONER BALDWIN: So -- 21 MS. HYDE: I'm sorry. 22 COMMISSIONER WILLIAMS: Go ahead. 23 MS. HYDE: No, sir, go ahead. 24 COMMISSIONER BALDWIN: Where are you? 25 MS. HYDE: Page 8, elected officials. 8-3-10 bwk 71 1 COMMISSIONER BALDWIN: Okay, that's where I'm at. 2 So, you got the County Judge. And what about J.P.'s? 3 MS. HYDE: On the J.P.'s, if you look over at the 4 supplement, a $2,000 supplement for doing the city 5 magistration at the jail. And then $2,739 was an average as 6 an increase to their M.H.M.R. going from $40 a case to $50 a 7 case. 8 MS. HARGIS: That's a pass-through. 9 MS. HYDE: And that's a pass-through. 10 COMMISSIONER BALDWIN: J.P.'s, there's a supplement 11 for them doing the city work at the jail. 12 MS. HYDE: That's what we're requesting. There 13 isn't one -- there isn't one now, but we're requesting one. 14 They have to magistrate at the jail in their magistration 15 process. They don't just do Kerr County that gets picked up. 16 They do all the city's. 17 COMMISSIONER WILLIAMS: Have we ever talked about 18 recovery of those costs? 19 MS. HARGIS: Yes. 20 MS. HYDE: Yes, sir, there's been lots of 21 discussions. 22 COMMISSIONER BALDWIN: In this room? 23 MS. HARGIS: They've met with the city. The J.P.'s 24 met with the city at length last year and requested that the 25 city either reimburse us or participate or do something, and 8-3-10 bwk 72 1 they refused. I don't see a J.P. in here, but -- 2 MR. AYALA: Want me to go get one? 3 JUDGE TINLEY: If my memory serves me correctly, I 4 think it was Judge Billeiter that met -- 5 MS. HARGIS: And Judge Kathy Mitchell and Dawn 6 Wright. They all three met with the city. 7 MS. HYDE: With the city multiple times. 8 COMMISSIONER BALDWIN: So the City says, "No, we're 9 not going to pay you for doing our work." We say, "Okay, 10 we'll do it"? 11 COMMISSIONER LETZ: And then they say, "And by the 12 way, pay us more for EMS." 13 COMMISSIONER BALDWIN: Yeah. 14 MS. HARGIS: Uh-huh. 15 COMMISSIONER WILLIAMS: Yeah. 16 COMMISSIONER BALDWIN: "I love you; however..." 17 COMMISSIONER OEHLER: But we haven't charged them 18 for road work yet either. 19 COMMISSIONER WILLIAMS: There's also a time when we 20 go back and charge them for Animal Control, too. May not be 21 this year. 22 COMMISSIONER OEHLER: No. 23 SHERIFF HIERHOLZER: There could be one option to 24 make that up. Currently we're charging the City $35 for the 25 first day of inmates prior to being housed. If you went up 8-3-10 bwk 73 1 on that cost -- and that's where, whether it's Ingram or 2 Kerrville or whoever, if you went a little bit up on that 3 cost to, say, $40 -- 4 COMMISSIONER LETZ: Say you want 70. 5 SHERIFF HIERHOLZER: Maybe 37. But if you went up 6 a proportionate amount, you could probably make up that 2,000 7 that they're having to pay. But you can only charge them for 8 prior to that inmate being magistrated, okay? And then after 9 that, you can charge them if it's a city ordinance violation, 10 camping in the park that we get all the time and things like 11 that. You can charge them for those, but otherwise you can't 12 charge them. But that could -- because I was thinking about 13 letting y'all decide whether you want to go up on that cost 14 or not. 15 COMMISSIONER LETZ: That's a reasonable, and would 16 be to me a fair thing to do. 17 COMMISSIONER OEHLER: We have administrative costs 18 too. 19 COMMISSIONER BALDWIN: Is that in our fees? In the 20 Sheriff's fees? 21 SHERIFF HIERHOLZER: Yes, it would be part of 22 Sheriff's fees that we'll have to look at before the 23 adoption. 24 MS. HYDE: But it's within -- before they 25 magistrate, right? 8-3-10 bwk 74 1 SHERIFF HIERHOLZER: Hmm? Yeah, if -- 2 MS. HYDE: Has to be before they magistrate. 3 SHERIFF HIERHOLZER: If they've been magistrated, 4 if it's a state charge of any type, whether it's traffic, 5 P.I., disorderly, if it comes out of the Penal Code or 6 anything like that, it's a State-oriented charge, we can only 7 charge them that one day. 8 MS. HARGIS: And then the M.H.M.R. is a 9 pass-through, because they pay for those. 10 MS. HYDE: Right. 11 JUDGE TINLEY: Charge it as court costs on the 12 case. 13 MS. HYDE: On the constables, the supplement is to 14 give them -- this year, again, we're requesting that if they 15 have the master peace officer's certification, that they get 16 the 5 percent increase for that master peace officer's 17 certification. 18 COMMISSIONER BALDWIN: That's not available today? 19 MS. HYDE: No, sir, y'all have turned it down the 20 last three years. 21 COMMISSIONER LETZ: So it would be -- what you're 22 saying is a $2,000 supplement for that master peace officer? 23 (Ms. Hyde nodded.) 24 COMMISSIONER LETZ: Going back to the J.P.'s, it's 25 $4,739 per J.P.? 8-3-10 bwk 75 1 MS. HYDE: Yes, sir. 2 COMMISSIONER WILLIAMS: Mm-hmm. 3 MS. HYDE: Be 2,000 under M.H.M.R. -- I'm sorry, 4 2,000 under the magistration, and then 2,739; it's an average 5 of all the M.H.M.R. cases, and we averaged it, because it 6 kind of depends on the time of year. 7 COMMISSIONER WILLIAMS: Taking it from 46 to 51. 8 MS. HYDE: Yes, sir. 9 SHERIFF HIERHOLZER: They did -- they aren't in 10 here, but there's been several meetings over the last month 11 over M.H.M.R. They did get a lot added onto their plate in 12 the last few months dealing with any potential M.H.M.R. 13 subject inside that jail. Now every time that one's booked 14 in that a jailer just thinks they might be, or whether 15 there's been a past, they have to notify the J.P. The J.P. 16 has to issue an order for assessment. There's a lot of 17 changes that added a lot to the J.P.'s just in the last few 18 months. 19 COMMISSIONER BALDWIN: Does the County Judge get a 20 supplement for M.H.M.R. work? 21 MS. HYDE: Yes, sir, that was part of the 18,000. 22 COMMISSIONER BALDWIN: Do they today? 23 MS. HYDE: Does he today get one? No, sir, he 24 doesn't get one. 25 JUDGE TINLEY: There's a very small supplement -- 8-3-10 bwk 76 1 let me correct that. There's a small $10-per-case 2 supplement -- 3 MS. HYDE: Oh, is there? 4 JUDGE TINLEY: -- that's also added as court costs. 5 MS. HYDE: So it's not -- 6 JUDGE TINLEY: It's added as court costs also. The 7 Court initially approved that back in 1999, as I recall. 8 MS. HARGIS: The big one. 9 COMMISSIONER BALDWIN: Now, are you -- are you 10 going to recommend that -- let's just use the J.P.'s so we 11 don't embarrass the Judge, okay? 12 COMMISSIONER LETZ: Use the Sheriff. 13 COMMISSIONER BALDWIN: Huh? 14 COMMISSIONER LETZ: Use the Sheriff. 15 COMMISSIONER WILLIAMS: Yeah, use the Sheriff. 16 COMMISSIONER BALDWIN: Oh, use the Sheriff. Okay. 17 MS. HYDE: Sheriff's next. 18 COMMISSIONER WILLIAMS: That's a good one. 19 COMMISSIONER BALDWIN: Is he packing heat? 20 SHERIFF HIERHOLZER: Yes. 21 COMMISSIONER BALDWIN: Okay, let's get back to the 22 J.P.'s; they're not even in here. It doesn't matter. In the 23 budget next year, are you going to show the current salary 24 and then the supplement as separate? Why do that? Why not 25 just roll it in there? 'Cause you're giving them a salary 8-3-10 bwk 77 1 increase, is what you're doing here. 2 MS. HARGIS: We're going to show it as a 3 supplement, because if they didn't do the State Hospital, 4 M.H.M.R. any more, then they wouldn't get paid for doing it. 5 COMMISSIONER BALDWIN: In other words, J.P. 4 will 6 not get this. 7 MS. HARGIS: If he's not -- 8 MS. HYDE: In they don't do M.H.M.R. 9 COMMISSIONER BALDWIN: Well, I don't think he does. 10 JUDGE TINLEY: Yeah, he does. 11 MS. HARGIS: They all four do. They rotate. 12 COMMISSIONER BALDWIN: Does all four go to the jail 13 and magistrate? 14 SHERIFF HIERHOLZER: Yes. 15 COMMISSIONER BALDWIN: It used to not be that way. 16 MS. HYDE: What you're thinking, absolutely. If we 17 do it as a supplement and they don't, then we can take the 18 supplement away, or they don't get the supplement. 19 COMMISSIONER WILLIAMS: Just don't get it. 20 MS. HYDE: Sorry? 21 COMMISSIONER WILLIAMS: They don't get it. 22 MS. HYDE: Right. 23 MS. HARGIS: But the way we're looking at this 24 right now is we're going to increase the fee on the M.H.M.R., 25 which will pay for their 2,739. 8-3-10 bwk 78 1 MS. HYDE: Right. 2 MS. HARGIS: We're going to increase the fee on 3 their jail -- the city people going to the jail so that there 4 will be revenue to offset that increase, so it'll be a net 5 cost to the county of zero. 6 MS. PIEPER: What fee are you going to raise? 7 MS. HARGIS: For their court costs, the judge. 8 JUDGE TINLEY: When J.P.'s do the probable cause 9 hearings, there's a separate order entered in each case that 10 appoints a J.P. and provides for that master's fee to be paid 11 to them as -- charged as court costs. That's how it gets 12 passed through. 13 MS. HYDE: And then last, but not least on this 14 page is the Sheriff. Requesting a $24,000 supplement in his 15 case, because he is a master peace officer with over 20 16 years. And if you go to that next page, it tells you the 17 breakdown of all the supplements. Again, if the Sheriff -- 18 if we elected a new sheriff that didn't have a peace 19 officer's license -- you do not have to be elected sheriff -- 20 you may want to help me here. You don't have to be elected 21 sheriff and be a peace officer, which I understand we've had 22 in the past, just like we've had county judges that weren't 23 lawyers, which caused some hiccups and we had to pay 24 outsourced lawyers to hear cases and things. On the Sheriff, 25 we had -- if they're a peace officer, they have up to two 8-3-10 bwk 79 1 years to get their peace officer's license. So, why not 2 reward a sheriff that has a master peace officer and over 20 3 years experience if they are so elected? 4 JUDGE TINLEY: Excuse me. Are you okay? Got a 5 bucket of rocks? 6 COMMISSIONER BALDWIN: Do you know what my problem 7 is? 8 JUDGE TINLEY: Just glare at me if that's the case, 9 okay? 10 COMMISSIONER BALDWIN: My problem with this whole 11 thing is, our previous conversation before salaries, et 12 cetera, is that we had employees down the hall that's not 13 going to be able to afford to work here, or anywhere else, 14 because our insurance is going up so high; they don't have 15 the money. And then we turn around and give an employee a 16 $24,000 salary increase? 17 MS. HYDE: Mm-hmm. 18 COMMISSIONER BALDWIN: I plan on living here for a 19 little while. I don't plan on somebody running me out of 20 town for voting for something like this. I can't support 21 this, even this theory. I don't know the answer yet, but 22 I'll figure it out. And I think I do, actually, know how to 23 do this thing, but it's for another day. That really 24 troubles me a lot. 25 SHERIFF HIERHOLZER: Buster, the only comment I'll 8-3-10 bwk 80 1 make, if you don't do something -- and I'm not -- I mean, I'm 2 doing all right, don't get me wrong. But if you don't do 3 something, your chief deputy's going to make more than your 4 sheriff. 5 COMMISSIONER BALDWIN: Well, maybe we just need to 6 eliminate him or something. But -- 7 SHERIFF HIERHOLZER: I don't agree with that. 8 COMMISSIONER BALDWIN: I'm not joking a damn bit. 9 That's the kind of stuff we're going to have to do. Or a -- 10 even a -- let me go back. 18,000? An $18,000 salary 11 increase? That is a lot of money. 12 MS. HYDE: Mm-hmm. 13 COMMISSIONER BALDWIN: What if we applied that to 14 these little girls that work down the hall and help them get 15 insurance for their kids so they can keep working here? See, 16 this doesn't -- this doesn't make sense to me. And it 17 certainly will not make sense down the street. I guarantee 18 you it won't. 19 MS. HYDE: This is one of the options, and this is 20 one of the things that y'all have talked about in the past, 21 so this is not -- it's not an all or nothing. This is just 22 things for y'all to ponder and think about. 23 COMMISSIONER BALDWIN: I understand. 24 COMMISSIONER WILLIAMS: Next screen, huh? 25 MS. HYDE: Next screen. These are proposed 8-3-10 bwk 81 1 position schedule changes. 2 COMMISSIONER WILLIAMS: This button, where it 3 starts with Road and Bridge. 4 MS. HYDE: First one is Road and Bridge. Position 5 is a certified mechanic. We currently have a position that's 6 31,000; it was passed by the Court. The variance is 10,699. 7 We need an ASE-certified mechanic, and the position needs to 8 hold. Requesting -- on the administrative assistant, they've 9 received their herbicide-pesticide license, which has 10 increased the ability for us to do pesticides throughout, 11 including at the airport. And then a 5 percent merit, and 12 for increased responsibilities, and also for taking over more 13 of the Road and Bridge administrator position for -- for the 14 assistant administrator. In the County Attorney's office, 15 all we did was reclass an administrative assistant, just 16 reclassed him from a 15.9 to a 17.5; there's no variance. In 17 the County Clerk, District Clerk, and Tax Assessor's office, 18 there is a request for the chief deputies to go from a Grade 19 19 to a Grade 23 after they have proven that they are 20 completely certified and can do and fulfill the duties of 21 their elected official. Did I say that right? 22 MS. PIEPER: Yes. 23 MS. HYDE: That is a 2.5 percent increase. In the 24 County Clerk's office, we reduced another clerical position. 25 In the District Clerk, we're requesting an additional $8,000 8-3-10 bwk 82 1 for a permanent part-time position, and one deputy clerk to 2 go from a 15.2 to a 15.3 due to their increased job 3 responsibilities, and that is including some bookkeeping. Is 4 that not correct, Linda? 5 (Ms. Uecker nodded.) 6 MS. HYDE: Okay. And that one deputy clerk, that 7 has been at a 14.2 for almost two years, and bring her up to 8 a 15. She is now cross-trained throughout the office, so all 9 employees would be 15's. In the Tax Assessor's office, we 10 talked about the chief deputy, but on the tax clerk and the 11 senior tax clerk, these two individuals completed 12 certification in excess of 137 hours of classroom time away 13 from -- away from here, in addition to passing all tests 14 needed so that they received their RTC license. Is that 15 correct? 16 MS. BOLIN: Correct. 17 MS. HYDE: In Maintenance, he's requested one 18 additional position, which is a maintenance-slash-housekeeper 19 position. And that's due to the increased -- the increased 20 job that we have out there. We've got new buildings, and 21 we've got a lot of square footage. A promotion for one 22 maintenance worker to go from -- it's a 5 percent increase, 23 so that he can be the lead maintenance worker. If Tim's off, 24 he can help cover. And increase his part-time to $5,000 for 25 heavy times in need, particularly during the mowing season. 8-3-10 bwk 83 1 Did I leave anything out? 2 MR. BOLLIER: No. 3 MS. HYDE: The J.P.'s, I've requested -- J.P. 2, 4 J.P. 1, and J.P. 4 have requested a 2.5 discretionary 5 increase, one of three the officials can give to an employee 6 based on our longevity. You can have three throughout your 7 career, and they're discretionary. The only place they can't 8 do that is the Sheriff's Office, because they get educational 9 increases and they are out of this. And there's more 10 information if you'd like it on those discretionary raises, 11 on which one it is for each. But -- and then last, but not 12 least, in the Sheriff's Office, he has requested one new 13 position -- one new deputy position, which would take his 14 total deputies from 16 to 17. 15 SHERIFF HIERHOLZER: That one, right now I'd like 16 to withdraw that request. She does not know yet. 17 MS. HYDE: He just said to withdraw that request, 18 so there's a $42,000 variance that just came off of it. 19 COMMISSIONER BALDWIN: Okay, we're going in the 20 right direction here. 21 MS. HYDE: On crime prevention, asking for a 5 22 percent increase for this person because of merit and 23 additional job responsibilities. They are over dispatch, 24 which is 10 employees. They do crime prevention. They do 25 the civilian -- 8-3-10 bwk 84 1 SHERIFF HIERHOLZER: Citizen academies. 2 MS. HYDE: Citizen academies. 3 SHERIFF HIERHOLZER: Main thing was that one person 4 became the supervisor for dispatch over all 10 of those. 5 COMMISSIONER BALDWIN: Who was the supervisor in 6 dispatch before? 7 SHERIFF HIERHOLZER: At one point it was Sharon 8 Green, who had left. If you'll remember her, she went to 9 Farmers Branch two years ago, and then I just had some people 10 trying to fill in, one on days, one on nights. But Pam took 11 it over completely. 12 MS. HOFFER: She does the neighborhood watch 13 program. 14 MS. HYDE: And the neighborhood watch program; 15 that's right, she does. 16 MS. HOFFER: She's done a really great job; has 17 made it very easy. 18 MS. HYDE: And then last $6,000 that we discussed 19 putting in for the educational and increases. Instead of 20 trying to put those with a name, 'cause they change, just put 21 the educational increases in there at a max of $6,000. 22 COMMISSIONER BALDWIN: I want to go back to the 23 first page of that and just ask a simple question. Road and 24 Bridge, the administrative assistant. One of the -- one of 25 the reasons that you're increasing is because that person is 8-3-10 bwk 85 1 taking over more of the administrator's job? 2 MS. HYDE: Taking over more and more of the 3 responsibilities. 4 COMMISSIONER BALDWIN: The responsibilities and 5 functions. Are we decreasing the supervisor's salary to do 6 this? 7 (Ms. Hyde shook her head negatively.) 8 COMMISSIONER BALDWIN: Why not? 9 MS. HYDE: I can put one in there if you'd like. 10 COMMISSIONER BALDWIN: She's doing more; we're 11 going to pay her more. Why aren't we paying him less? 12 MS. HYDE: If that's what you want me to do. 13 COMMISSIONER BALDWIN: Well, that's exactly what I 14 want you to do. I mean, this is -- every dollar that goes 15 through here goes through some family, and we're dealing with 16 serious dollars here, serious issues, I think. By the way, 17 Kelly, I love the way you work. 18 MS. HOFFER: Thank you. 19 COMMISSIONER BALDWIN: You're welcome. 20 MS. HARGIS: That's going to come -- that 21 particular line item will come down even more, because we had 22 to put insurance in there for that one new person, so that's 23 going to decrease it a greater rate than just the 42. So, 24 it's going to be probably around 60,000 to come off of there. 25 MS. HYDE: Right. 8-3-10 bwk 86 1 MS. HARGIS: That will be cut almost in half. 2 MS. HYDE: Then we're asking for the additional 3 salary increases at 3 or 5 percent cost-of-living adjustment, 4 and increased needs. Then there's a breakout. Bottom line, 5 at 3 percent, increases for appointed officials would cost 6 41 thousand, eight. Increases for elected officials would be 7 would be 57,829. Increases for officials total would be 8 $99,000. Position control schedule changes is 115. 9 Increases for employees at 3 percent across the board is 10 349 K. Insurance contribution from the County, $402,920, for 11 a grand total of 967,822. 12 COMMISSIONER WILLIAMS: Insurance contribution for 13 the County is under which scenario? 14 MS. HYDE: That is the 55, the 240, the 250, and 15 the 450, which takes them -- doesn't give them much money -- 16 more money; it just keeps them whole. At the 5 percent, 17 those numbers -- those numbers -- increases for appointed 18 officials stays the same; it's 41,8. Increases for elected 19 stays the same, 57,8, so increases for -- the total for 20 officials stays the same at 99. Position schedule changes 21 stay at 115,899, but then the increases for those at 5 22 percent is $582,000, which takes us to a million, two. 23 COMMISSIONER BALDWIN: What's the cost of living? 24 MS. HYDE: Cost of living is 2.56 right now. 25 COMMISSIONER BALDWIN: It's gone up a little bit, 8-3-10 bwk 87 1 huh? 2 MS. HYDE: Yes, sir. 3 MS. BOLIN: Would this 5 percent be after the 4 supplements and all the increases for some of the elected 5 officials and -- 6 MS. HYDE: No. 7 MS. BOLIN: Instead of? 8 MS. HYDE: No. That's why the numbers didn't 9 change from page to page. 10 COMMISSIONER WILLIAMS: A quarter million dollar 11 difference between 3 and 5 percent. 12 MS. HYDE: Yes, sir. 13 COMMISSIONER BALDWIN: Drop in the bucket. 14 COMMISSIONER WILLIAMS: Piece of cake. 15 MS. HARGIS: Do you want to take a break? 16 JUDGE TINLEY: Okay. This is a good place to break 17 it off right now? Okay, let's take a recess. 18 (Recess taken from 2:48 p.m. to 3:08 p.m.) 19 - - - - - - - - - - 20 JUDGE TINLEY: Okay, let's come back to order, if 21 we might. Okay. Ms. Hargis, you're up. 22 MS. HARGIS: Okay. Now we're going to talk about 23 the property taxes. 24 COMMISSIONER WILLIAMS: Uh-oh. 25 MS. HARGIS: Okay. 8-3-10 bwk 88 1 COMMISSIONER WILLIAMS: Which one of these buttons 2 do I push? 3 COMMISSIONER LETZ: How do I get to that? 4 COMMISSIONER OEHLER: Did we get another piece of 5 paper for that? 6 MS. HARGIS: Hang on just a second. I do have 7 another piece of paper. We also have a slide -- 8 COMMISSIONER WILLIAMS: The slide show. 9 MS. HARGIS: Just a second. We're in the slide 10 show business today. 11 (Discussion off the record.) 12 COMMISSIONER WILLIAMS: Who's the artist? 13 MS. HARGIS: Tess is the artist of all of the Power 14 Point. Okay, are we ready? 15 COMMISSIONER LETZ: Yes. 16 MS. HARGIS: Okay. Loss from the over-65 tax 17 freeze. 18 COMMISSIONER WILLIAMS: All right, what are we 19 doing? 20 MS. HARGIS: It's kind of in segments. All right. 21 The amount of loss due to the freeze is 22.279 percent of the 22 total taxable value for the past four years, which has 23 depleted a lot of our reserves. The next page is what we've 24 lost. The tax freeze began in 2006. In 2007, we lost 25 582,774. 2008, 1,141,774. Year four, 1,117,216. And this 8-3-10 bwk 89 1 year, we've lost 1,110,877, for a total of 3,952,651. Which 2 is $4 million in tax revenue over the last four years, and 3 it's not really slowing down. In addition -- 4 COMMISSIONER LETZ: Didn't we anticipate we were 5 going to lose about -- stay at about a million dollars a 6 year, or stabilize more or less now? 7 MS. HARGIS: I don't know whether it's stabilized 8 or not, because you have an over-65 community. Therefore, 9 you're not going to see the stabilization that you would see 10 in an area where the over-65 freeze was just part of the 11 overall population, or let's say 10 percent. You have 40 12 percent of the residents in this county over 65. 13 COMMISSIONER WILLIAMS: There was some expectation, 14 you know, years ago when we started this, that at some point 15 in time it would be maturing; properties going off and then 16 new properties, new owners coming on, and so there would be 17 some maturing. That hasn't been evident, obviously. 18 MS. HARGIS: There's not -- you have to remember 19 that -- let's say if -- you only have to have one spouse 20 that's 65. The other spouse can be any age. And so as long 21 as that -- if the one spouse that's 65 passes away, if the 22 other spouse stays in that home, whether they're 50 or 45, 23 they get to keep that tax freeze until they sell that house. 24 And so -- 25 JUDGE TINLEY: Ain't much selling, either. 8-3-10 bwk 90 1 MS. HARGIS: There's nothing -- and that's the 2 other problem right now; nothing is selling. So, a lot of 3 people -- we may see some reduction, you know, next year from 4 the -- from those folks who may not own their homes any more 5 this year, but it's not going to happen till next year, you 6 know. If they pass away during the year, and there's -- you 7 know, their children have to come and get their homes, and 8 the homes don't sell until January 1, it doesn't -- it 9 doesn't change. On the next page, we talk about what we have 10 done, and Eva talked about this a little bit, to counteract 11 effects of the freeze. We have reduced spending tremendously 12 since I've been here. And this year, we hope -- and we're 13 hoping that we have as much as $760,000 that we don't spend 14 in the current budget. A large portion of that is thanks to 15 the Juvenile Probation Department, and there's been 16 380-something thousand dollars that we haven't had to spend 17 in housing. In fact, we just got another grant today of 18 15,000 that we're going to turn around and pay ourselves back 19 with for some payments that we've already paid out. 20 We have reduced the budget this year. We had a 21 pretty bare-bones budget. We went through it, as you know, 22 during the workshops and we reduced it some more. We've done 23 cost center studies to pinpoint efficiency and reduce waste. 24 We've done this with our audits, and we've gotten every 25 department to come around about certain ways of doing it. 8-3-10 bwk 91 1 This one is going to really shock y'all. This is the 2 rollback rate, .0576. If you turn to the next page, with a 3 tax increase of .0576 -- that's the rollback rate -- the 4 average home, which is shown on the Appraisal District roll 5 as being 174,000, the current tax is 690.95. At 5 cents, it 6 would be $100.22, at 576. At .35, $60.90. And then for the 7 $100,000 house, the current tax is 397.10, $57.60, or 35. I 8 did the 100,000 so you can figure that. You know, it's about 9 57.60 per 100,000. 10 COMMISSIONER BALDWIN: Sounds reasonable, doesn't 11 it? 12 MS. HARGIS: I'm not saying what's reasonable. I'm 13 just showing you -- 14 COMMISSIONER BALDWIN: It sounds reasonable. 15 MS. HARGIS: And if we -- if you own a home valued 16 at 174,000, and you have a tax increase of .0576, you're 17 looking at a tax increase of about $100, which we just looked 18 at, which is about $8.33 per month, or about the price of one 19 fast food combo meal. More tax information. Every one-cent 20 increase in property tax this year equates to about $290,000. 21 We lost this year $63 million in value when the certified 22 roll came back. That's more than we -- than you have lost in 23 the three years that I have been here. That's a substantial 24 amount of loss in value. 25 COMMISSIONER BALDWIN: How much? 8-3-10 bwk 92 1 MS. HARGIS: With the proposed tax rate -- 2 JUDGE TINLEY: 69 million. 3 COMMISSIONER BALDWIN: 69 million? 4 MS. HARGIS: 63 million. 5 COMMISSIONER LETZ: 63. 6 MS. HARGIS: We did not -- 7 COMMISSIONER WILLIAMS: And that's loss in value, 8 right? 9 MS. HARGIS: That was protested value that we lost 10 between the -- the original -- the roll they gave us in May 11 and the certified roll. 12 COMMISSIONER WILLIAMS: Okay. 13 MS. HARGIS: And a lot of people -- 14 COMMISSIONER OEHLER: It still went up, though. 15 This is the amount that it came down after they started to 16 certify the -- before they certified the roll. 17 MS. HARGIS: It went up -- 18 COMMISSIONER OEHLER: We did have an increase in 19 property values overall. 20 MS. HARGIS: Some. We had a -- if you take our 21 current tax rate and multiply it times the new rate, it's 22 about 350,000, is what we have. 23 COMMISSIONER BALDWIN: There was a $350,000 -- 24 Bruce, what are you saying? 25 COMMISSIONER OEHLER: Net increase in revenue is 8-3-10 bwk 93 1 what I read that, from taxes. From new taxable value. 2 COMMISSIONER WILLIAMS: Basically, that was new 3 stuff coming on the roll, right? 4 COMMISSIONER OEHLER: So you lost 69 million off 5 the deal that wasn't -- that's -- that's kind of making a 6 story. 7 MS. HARGIS: Well, no, it was reduced on the roll 8 by 63 million. 9 COMMISSIONER OEHLER: Yes, but that was from the 10 pre -- from the estimated original value as to what it wound 11 up being when they were certified; is that right? 12 COMMISSIONER LETZ: Last year's off of the 13 proposed. 14 COMMISSIONER OEHLER: Yeah. 15 MS. HARGIS: But part of that was for the windmill 16 line, and we didn't get the increased value that we had hoped 17 to get on that. So, the windmill line is on at a very 18 nominal rate, so I think that's something we need to look at 19 maybe for next year. I've given you -- with the .0576, it's 20 1.6 million. With the .035, it's around a million. Okay. 21 If we can change to the next slide, why do we need a tax 22 increase? The freeze has depleted our reserves. Our health 23 insurance costs have risen dramatically and are expected to 24 continue to do so for the foreseeable future. And we would 25 like to continue to add value to the county by investing in 8-3-10 bwk 94 1 the county employees by keeping up with the cost-of-living 2 increases, as well as providing a quality benefits package. 3 Why do we need a tax increase? Our revenue streams are 4 limited, and as such, our largest source of revenues are 5 property -- are property taxes. While expenditures are 6 expected to be down by 760,000, fee and fine revenue is 7 expected to be down by a half a million again this year, as 8 reflected in our 2009 audit; we lost 500,000 last year, 9 offsetting much of the savings. 10 To stabilize county finances and instill confidence 11 in Kerr County's provision of continued service during 12 periods of adverse economic conditions. To continue to have 13 an over-65 tax freeze and take care of our mature citizens, a 14 portion of the cost must be absorbed by spreading the cost 15 out among other taxpayers. The safety of our citizens is of 16 utmost priority. As such, the citizens of Kerr County 17 require properly trained officers and other quality personnel 18 paid at a competitive wage. So, this is kind of corny, but 19 let's do what's it takes to protect Kerr County, our home, 20 because a safe home is a happy home. The biggest -- 21 COMMISSIONER LETZ: I have a question on that. On 22 the tax freeze issue, do we have any idea at what point -- I 23 mean, is this going to continue? Like, a year from now we're 24 going be to be in the same situation, or three years, of the 25 reserves being depleted? Say we do a tax increase this year. 8-3-10 bwk 95 1 Are we going to come back in three years and say our reserves 2 are all depleted again? 3 MS. HARGIS: Well, that's why I'm proposing such a 4 large tax increase. We've given you, you know, around a 5 million dollars or a million, one. Since we've -- we -- you 6 know, we lost a couple of things when we were going through 7 the list. What we would like for y'all to do, I would really 8 like to put that $600,000 back in reserves. Because the 9 problem we're having is, like Bruce said, we may have gained 10 350,000 in our tax revenue, but we've lost 500,000 over here, 11 so I've really got a net loss, and that's continuing to 12 happen. We have analyzed the revenue, and Jannett and Cheryl 13 did a great job and sent me an e-mail this week saying that, 14 you know, they can track where the housing industry is a 15 large portion of what they've lost. They've also lost death 16 certificate income of about $50,000 a year because they're 17 using the internet now. Our civil cases are down. All the 18 fees that we have are down, and we're at maximum. I've 19 talked to every clerk; we're at maximum fees. Rusty's fee 20 for the -- the jail in the city was about the only thing I 21 know of that we can go up on. 22 I ask this question every year, and, you know, we 23 just -- we continue to have -- the other problem we've got is 24 to run this court system, these C.P.S. cases, we had another 25 huge load of them come in. And, you know, we're looking at 8-3-10 bwk 96 1 paying at least $2 million a year for indigent defense 2 attorneys, between C.P.S. and the indigent and the cases that 3 we've had in the last year. That's a huge dollar amount. 4 And that's, you know, not something -- I mean, I think it's a 5 mandate that's down on the counties. We don't know what the 6 State's going to do to us to pick up some of their $18 7 million, and I -- I want some kind of a buffer in case that 8 happens. And the sales tax situation is 2006 levels. Part 9 of it I think was from the gas. You know, it was kind of an 10 inflated, unrealistic gain in 2008 and 2009, because it went 11 to $4 a gallon, and then all of a sudden it took this huge 12 dive. 13 What I'm seeing with the sales tax, we got real 14 close in June, within $100. This last month we were 10,000 15 less than last year. We are running at the 2005-2006 levels. 16 In 2007, '8, '9, we got sales tax of at least 200,000 and 17 better. Now we're doing good to get something in the 187, 18 165 range, so we need to get that rate to where it's -- it's 19 equalizing the tax rate. Now, if -- when the tax freeze went 20 into effect, I don't know; I wasn't here. I didn't even -- I 21 had just moved here. But it would have been my advice to you 22 at that point to have your tax financial adviser come in and 23 say, "Here's what you need to do to offset the effect of this 24 freeze." And I would have assumed that would have been a 25 real small -- either you took the effective rate, which is 8-3-10 bwk 97 1 probably not even more than a half a cent, every year, just 2 to keep up with offsetting the freeze. The freeze is bad 3 enough. We probably would be okay and could sustain the 4 freeze if we didn't have the economic down turn, and so 5 between the two, and -- and the insurance premium, we have, 6 you know, a real problem. 7 And I tell you what; I kind of had Eva hit me over 8 the head with a lightning bolt this week, because we've been 9 working for the last two weeks with trying to figure out lots 10 of different things for y'all, and one thing that I didn't 11 understand, and I'm going to say it for her today. We're 12 already at 2 million 9 this year, guys. We're going to be 13 lucky if we don't go over 3 million 1 or 3 million 2 in 14 claims. So, we -- for our insurance consultant to come in 15 here and tell us he's going to reduce our premium when we've 16 already hit that level isn't going to happen. In fact, we 17 already plugged in 200,000 more, because we're concerned it's 18 going to go even higher because of the claims. We had -- 19 last week we had -- in one week, the claims -- claim check 20 was $137,000. And if you -- if you divide 2 million 2 by 12, 21 it's 183,000. So, we have had a really bad year as far as 22 claims are concerned, and it's not getting any better. 23 MS. HYDE: Let me just piggy-back on the claims. 24 When Gary and have I been talking during the last six months 25 on all these numbers, the other thing is, in the past when we 8-3-10 bwk 98 1 went out and we were able to bid, when we were doing RFP's 2 for bids, they typically look at your last three to five 3 years. Guess what they're not going to do this year? 4 They're going to look at your worst year. They've already 5 told everybody that. That's in the stuff that I sent out to 6 you guys. So, guess what? This is our worst year. And, I 7 mean, Judge, that was perfect with the "perfect storm"; it's 8 like everything that could go wrong has hit us this year. 9 MS. HARGIS: So, we hate to hit you with -- I mean, 10 you know, the scenario is if you have a problem, you bring a 11 solution. We've tried for two weeks to come up with a 12 solution that was not what I just presented to you, but I 13 don't know where to get the funds even to pay for the 14 insurance alone. We don't have it. We -- we have basically 15 right now an almost balanced budget with what we have, but 16 that does not include the new insurance. So, between now and 17 Monday, I need y'all to think about this, because if we're 18 going to go for the tax increase, we have to do the public 19 hearing, and we will have to put -- we will have to decide 20 what we're going to do. And my suggestion would be to do the 21 maximum you think you want to do. You don't have to do that. 22 And then at least you've had the hearings and you have time 23 for Gary to come up with a better insurance. But in the 24 meantime, we won't hit the September 30th deadline; that's 25 why I gave that to you last time. If you don't get it done, 8-3-10 bwk 99 1 then we're stuck with last year, and we can't even pay. And 2 the other alternative, which is the only alternative that we 3 have, and I don't think any of us want that, and -- 4 MS. HYDE: I noticed you turned around and pointed 5 at me to get back up here again. The other -- the only other 6 alternative is ones that you guys asked, and I have put off 7 for five weeks giving you an answer on, is a reduction in 8 force, and that would be 25 people on the lower echelons. I 9 mean, to make it real simple, that's not what we're -- that's 10 not what I'm saying. I'm just telling you, for simple Texas 11 math, it would take 25 people at 14's or 15's to make up 1.1 12 million. 13 COMMISSIONER BALDWIN: But, you know, I understand 14 that. I -- I don't agree that that's the only option, but 15 that's beside the point right now. But that goes back to 16 Commissioner Letz' comment a while ago, or question. You 17 know, once we do all these wonderful, magical things that 18 y'all are suggesting, where are we going to be in two years? 19 MS. HARGIS: I think -- 20 COMMISSIONER BALDWIN: Right back in the same boat? 21 COMMISSIONER WILLIAMS: Could very well be. 22 MS. HARGIS: We could very well be, but I don't -- 23 I think -- 24 COMMISSIONER BALDWIN: And we're going to raise 25 taxes again in two years? Guess what? 8-3-10 bwk 100 1 MS. HARGIS: When the tax -- 2 COMMISSIONER BALDWIN: No, we're not. 3 MS. HARGIS: When the tax freeze took effect, in 4 the counties that had the larger over-65 population 5 throughout the state, this was a real -- you know, this was 6 something that they all were very concerned about. And if 7 you talk to Georgetown, if you talk to the Rockport area, 8 they're all having a hard time, and they're all having to 9 continually raise taxes because the population and their 10 demographics are over 65. And whether we like it or not, 11 Kerr County is a retirement community. And -- but yet the 12 retirement folks that we have want the top services that we 13 can provide for them, and so we need -- we need some stimulus 14 in our economic and our -- our growth here really bad. And 15 I'm not on that committee, Judge. You are. 16 COMMISSIONER BALDWIN: Yeah. 17 JUDGE TINLEY: Well, maybe they're starting to 18 think about E.D. now. Who knows? Thank you. 19 MS. HARGIS: Thank you. 20 JUDGE TINLEY: Okay. We got some things to think 21 about. See you Monday. 22 COMMISSIONER BALDWIN: Bye. 23 (Budget workshop was adjourned at 3:30 p.m.) 24 - - - - - - - - - - 25 8-3-10 bwk 101 1 STATE OF TEXAS | 2 COUNTY OF KERR | 3 The above and foregoing is a true and complete 4 transcription of my stenotype notes taken in my capacity as 5 official reporter for the Commissioners Court of Kerr County, 6 Texas, at the time and place heretofore set forth. 7 DATED at Kerrville, Texas, this 6th day of August, 2010. 8 9 JANNETT PIEPER, Kerr County Clerk 10 BY: _________________________________ Kathy Banik, Deputy County Clerk 11 Certified Shorthand Reporter 12 13 14 15 16 17 18 19 20 21 22 23 24 25 8-3-10 bwk