Walton County's finance director, Milton Cronheim, speaks to the Board of Commissioners during a public hearing on the proposed tax rate Tuesd…
MONROE, Ga. — A reduction in expected spending for employee retirement means the Board of Commissioners can consider adopting the rollback tax rate without cutting services.
The board will have its final public hearing on the tax rate at 5 p.m. Tuesday, but it won’t be necessary if commissioners stick to the plan they discussed at a work session Tuesday afternoon.
Commissioners will vote to set the tax rate in their monthly meeting at 6 p.m. Tuesday in the Historic Walton County Courthouse in downtown Monroe. It will be the first in-person regular meeting for the Board of Commissioners since COVID-19 forced meetings to be held by teleconference.
The board learned shortly after noon Tuesday at a public hearing — the second of three that are required if there’s to be an effective tax increase — that the $1.4 million increase allotted for a retirement account was set early in the pandemic.
“The number is $300,000 more than last time,” Finance Director Milton Cronheim said. “It’s not $1.4 million more than last time.”
The county has three employee retirement plans: a defined benefit plan, a 401(a) plan and a 457(b) plan. In the defined benefit plan, 2% of the employee’s pay goes into a trust that’s invested to fund pensions. The 401(a) retirement also has a 2% mandatory draw from the employee, with another 2% after the employee’s first year.
“It’s called a defined benefit plan because there’s a defined multiplier based on years of service, age and wages, and that determines what your defined amount will be when you retire,” Cronheim said.
He said actuaries don’t provide the amount of county money required for the plan until September of each year — after the budget is passed. So, it calls for a best guess by the finance department, something that became much more difficult in a time of economic uncertainty.
“Back in February, when we were putting numbers director, a previous finance director anticipated the stock market going down more than it did,” Cronheim said. “It’s come back a little; I think you all would agree with that.
“That matters because in that trust, they invest that money for the county, for the employees to earn income and also put their money aside so when they retire, it will be there.”
That previous finance director, Linda Hanna, put in an additional $1.4 million for the defined benefit plan. County finance officials, after the July 27 public hearing on the budget, asked actuaries to study the numbers again given more recent performance of the stock market.
“They came through with the number,” Cronheim said. “The number is $300,000 more than last time. It’s not $1.4 million more than last time. The $1.4 million that was put in as a budgeted amount for FY (fiscal year) 2021, the amount is only going up 300-and-something thousand (dollars).”
Reducing the spending in that account will allow the board to consider a tax rate of 10.667 mills.
For a home with $150,000 of appraised value, the county government portion of the tax rate would be $640.02 a year. Had the county gone with the 10.905-mill rate it was considering, that bill would be $654.30.
The rollback rate is where the millage rate would have to be set to keep revenues flat from the previous year. Officials said the decrease in spending on retirement should even give the county a small cushion even with taking the rollback millage rate.
Commissioners accepted the rollback rate from 2010-15 as the county clawed its way out of the Great Recession. However, in recent years the board has been more likely to hold the rate steady. Increased property values meant even with a consistent rate, the county government brought in more money.
The county’s portion is only about a third of a property tax bill. The county portion would be $1,146 on a $150,000 house if the Walton County Board of Education passes — and the Board of Commissioners adopts on Aug. 11 — a rate of 19.1 mills.
Last year’s school rate was 20.9 mills, or $1,254 a year.
Roger Hale, a regular critic of the county government and Republican candidate for the District 1 board seat in 2018, said he thinks the county should be more conscientious of spending public dollars.
“Maybe it’s time you guys considered maybe living within your budget or maybe a little less and not do this tax increase,” he said. “I know you guys all come in here and think about the employees, but you need to think about the taxpayers of Walton County.”
Richard Swearengin, who said he’s lived in Walton County since 1993, told commissioners he was concerned about the idea of increasing government spending in tough economic times.
“My recommendation is, do this (rollback rate) this year and then reevaluate next year,” he said.