Pension crisis could add $200K in cost for Boyle Health Dept.
Brent Blevins says the Boyle County Health Department has been preparing for its growing pension obligations for over a year now, and it hasn’t been easy. The health department is considered a “quasi-state agency” — meaning it’s not a full state agency and not a full county agency.
“It’s somewhere in the middle,” he says, but it is included in the state retirement system. “If the retirement goes from 49 to 84 percent (the amount of employers’ pension contributions), for Boyle, it would mean an additional $200,000 or so needed a year to meet our retirement costs.”
He says that’s why public health departments are backing HB 358, which caps the employer contribution rates for quasi-agencies like health departments, regional mental health programs, rape crisis and child advocacy centers to 49.47 percent for the upcoming fiscal year.
If passed the way it was originally written, it would give them a year reprieve before bumping the contribution requirements up.
HB 358 passed the full Senate 25-12 on March 13 after it was amended by a committee, but the House refused to agree with the substitute, and it was sent back to the Senate.
Information from the Kentucky Health Departments Association shows a map color-coding 64 different county health departments whose doors could be forced closed because of the expected increase in contributions. Forty-two of them could close within a year and 22 more over the next two years if the reprieve doesn’t go through, according to the map. Boyle was listed as one that could be forced to close in two years.
However, Blevins says KHDA didn’t account for the health department’s last tax rate increase, which comes from property taxes. In 2018, it went from 2.7 cents per every $100 assessed on property, to 3.7 cents.
“Actually, it will just about cover the cost of our additional retirement. On the map that’s been circulated, they were using our previous tax rate,” he said.
Blevins said the situation shows the pension reform effort “affects more than schools and teachers; it affects a lot of other agencies.”
The map of health departments “gives a pretty good idea to the general public about what could happen,” he said. “I don’t expect (the closures) to happen, but then again I don’t know what they’re going to do by the end of the legislative session.”
Blevins was also the director for Garrard’s health department until recently. J Smith, who is the environmental health manager for the Garrard health department, initially became interim director but has now been approved by the board as the regular, full-time director.
Garrard’s additional amount to contribute will be around $140,000; Smith says they have paid $11,028 so far in retirement for the current fiscal year.
“Well, it will be tight, but I think we’ll be able to swing it, now,” Smith said. As his first order of business, he reviewed all contracts Garrard’s department had, and cut many of them.
“Once I got over there and was figuring out what to do, we realized it was not the best plan for Garrard to have a contract with Boyle,” Blevins said. “It was OK in the beginning, but they need to keep every dollar they have for funding.”
Smith said Garrard has seven full-time employees and one part-time. “As of now, I don’t think we’ll have to cut anyone else,” he said. Two positions were already eliminated before he came on as director.
Although Smith said he is the logical person to fill the director position, he’s now pulling double duty — but he knew the department would not be able to hire another environmentalist.
“There’s so much we do on the environmental side. I regulate all the food service establishments, do school inspections of buildings and their food service, nuisance complaints like high weeds or garbage, inspect swimming pools and mobile home parks, do site evaluations and permitting of septic systems, oversee the quarantine of animals …” Smith said. “There’s really a lot to it, and that’s in addition to health director duties.”
In the midst of everything else, Blevins said, the Department of Public Health is currently reviewing all funding statewide, in order “to say, ‘Here are the core things we’re mandated to do, here are the things we still want to do in the community, and here are the things we’ve picked up over time and taken on, but aren’t mandated to.’”
Blevins said he thinks it’s a pretty good idea because it “drills us down to the basics of what public health is.”
Those basics, Blevins said, include disease management, which is monitored daily. “Things like Hep A, measles outbreaks, HIV, Hep C … Then start throwing in other communicable diseases — like STDs — we definitely have got to keep up with all of that.”
The restaurant and septic system inspections are mandated duties for the health department. “All of the environmental is mandated, we have to do so many inspections and there’s little funding for that. It’s the biggest program we have that we spend the most local dollars on, with no state dollars to support those,” Blevins said.
The WIC program is the health department’s biggest clinic-based offering, which will be kept going, along with the HANDS program, which puts “a live body in the home with a young parent and their newborn to help them work through — well, everything,” he says. HANDS has been very successful, with 35 average cases on any given day.
“Those kinds of basic programs, and emergency preparedness — we have a piece of that, too,” Blevins said, referring to when there is an outbreak and thousands need immediate vaccinations, like the swine flu outbreak from many years ago. “Combine all those things together, it gets down to core public health …” he says. The state is making sure health departments are focused on the core needs, he says, then adding things outside of that core as funding becomes available.
“I think it’s a great way to reset where we are as a government-type agency, and make sure we’re serving the community the best way we can in the areas we have expertise,” Blevins said, but admits he is probably in the minority as far as health directors seeing the positivity in the situation.
“Probably a lot of them are upset about the cuts — and it is cuts. I’m not saying we won’t have to do more.”
The Boyle health department has 11 employees currently. As of the end of February, it has paid $204,952 to the KERS system, which means about $25,600 per month. Blevins’ ‘18-’19 budget is $1.3 million; that includes $500,000 from local taxes, $250,000 from collected service fees and reimbursements and $550,000 from the state Department of Public Health, which includes some federal funding.
Also included in HB 358 is language allowing those quasi-agencies to completely opt out of using the state retirement system all together, something Blevins can’t completely grasp. “That’s a huge deal … it will weaken the system even more since fewer people will pay in,” he said. And health departments would have to find private companies to go through — something he really hopes they don’t have to go through.
“With government, particularly with health departments, our nurses could go out into the private world and make more money. It’s a good paying job, but retirement and health insurance is really good, and there’s something to be said for that,” Blevins said. “Honestly, that’s why some people are here in this system. If you take that away … “
However, the state lawmakers’ pension system is close to fully funded.
“They have a little different system that’s nicely funded, I think, from what I hear,” Blevins said with a smile.
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