Cook County

FY2017 Budget
October 13, 2016

Toni Preckwinkle

President, Cook County Board of

Commissioners

Executive Summary

Con&nues to support Health System focus on improving customer

experience through evidencebased prac&ces and appropriate stang

For the rst <me, alloca<ng employee benet costs to departments to facilitate
transparency in total cost of opera<ons

Implements a Countywide biometric Time and AIendance system to

streamline &mekeeping ac&vi&es and provide eciencies and accountability

Supports permanent sustained jail popula<on reduc<on and support of

legisla<on to provide expedient representa<on to pre-trial youth and adults.

Delivers cri&cal public safety services during a &me of crisis; doubles our
investment in community based an&-violence eorts

Completely ends diversion of Motor Fuel Tax funding historically allocated

to public safety opera<ons; now all funds support Transporta<on
ini<a<ves

Emphasizes long-term scal sustainability through increased pension

funding and con&nuing workforce reduc&on

Our Foundation for this Budget

Fiscal Responsibility

Innova&ve Leadership

Transparency &
Accountability

Improved Services

Implements Residen<al Rental Licensing Program to protect public health,

safety and welfare of unincorporated Cook County.

Budget Overview

FY2017
Execu&ve
2016 Appropria&on Recommenda&on

(FY16 v FY17)
$

Operating Budget Overview

$ in Millions

(FY16 v FY17)
%

8.0%

3.7%

Health Fund Expenditures

Health Fund Alloca<on

Health Fund Fee Revenue

$ 3,374.8 $ 3,464.8 $ 89.97

$ 1,640.4 $ 1,591.7 $ (48.67)

$ 121.2 $ 111.3 $ (9.99)

$ 1,519.1 $ 1,480.4 $ (38.69)

2.7%

2.7%

-3.0%

-8.2%

-2.5%

30.8%

Total Revenue

$ 3,374.8 $ 3,464.8 $ 89.97

General Fund Revenues

$ 1,734.4 $ 1,873.1 $ 138.7
Total General Fund
Expenditures net of addi<onal
pension appropria<on
$ 1,463.9 $ 1,519.3 $ 55.4
Addi<onal pension
appropria<on
$ 270.5 $ 353.8 $ 83.3

Total Expenditures

Excluding Supplemental Pension Appropria6on the Health and General Funds budget is
essen6ally at at 0.2% change; Supplemental Pension Appropria6on grows by 31%

Fulfilling Sales Tax Commitments

The full sales tax amount was u<lized to fund the commitments laid out as part of the
FY2016 budget:

1) Addi<onal Pension Appropria<on : $270.5M
2) Increased Transporta<on Funding: $10M
3) Increased Debt Service: $25M

Projection
$340 M
$64.5 M
$55 M
$13.6M
$473M

FY2017 Budget
$353.4M
$64.5M
$57 M
$20.3M
$495M

Below are the addi<onal commitments that were listed last year that have been
recommi`ed in the upcoming FY2017 budget:
Additional Pension Appropriation
Increased Transportation Funding
Increased Debt Service Costs
Pay As You Go Capital Equipment
Total Uses

Sales Tax
18.7%

CCHHS Revenue
33.6%

Fees, 6.14%

Where the Dollars Come From

Property Taxes*
16.7%

Other NonProperty Taxes

13.3%

Health Care
36.7%

Public Safety
31.4%

Where The Dollars Go

Fixed Charges &

Others
21.8%

Finance &
Administra&on
4.6%

Property &
Taxa&on
2.3%

Economic
Development
3.2%

Total (In Millions) = $4,403.6

Budget Overview
Personal
Property
Replacement Tax
(PPRT)
1.0%
Motor Fuel Tax
1.1%
Grants
5.9%
Other Funding
Sources
0.3%
Miscellaneous
Revenues
1.7%

Intergovernment
al Revenues**
1.0%
* Includes TIF Surplus

Public Health and Public Safety are 87% of opera6ons, excluding pensions & debt service

25,613

23,659

2012

E Re
duc<

2014

23,650

201
0

201
7:

2
,
3
85 F
T

23,169

2013

o n

23,706

2015

2016

23,439

All Funds Total Full-Time Equivalents Since 2010

23,985

2011

2017

23,228

(1%)

Total FTE FY2010 FY2017 (All Funds)

26,000
25,500
25,000
24,500
24,000
23,500
23,000
22,500
22,000
21,500

2010

Since 2010, there has been a 10% FTE reduc6on across the General, Health and Grant funds

Full-Time Equivalents

2011

2012

on 10.7%

2014

2011 2016 red

uc&

2013

2015

2016

Total Debt outstanding by the end of FY2016 will be down 10.7% since 2011
$3,900,000,000
$3,700,000,000
$3,500,000,000
$3,300,000,000
$3,100,000,000
$2,900,000,000
$2,700,000,000
$2,500,000,000

2023

2024

2025

2026

2027

2029

2030

2031

2032

2033

2034

2035

2036

2037
Series 2016A Refunding
Debt Service Target - 2.0% Growth Rate

2028

2038

2039

2041

2042

2043

2044

2045

2046

Series 2017 Refunding

2040

2047

2048

2049

Legacy Debt Service when coupled with new bond issuance con<nue to rise

2022

600

2021

500

2020

400

2019

300

2018

200

2017

100
-
2016

Unrefunded Legacy Debt Service

Projected New Money Debt Service

2050

Legacy Debt Outstanding

$ Millions

State Budget Impact

The State of Illinois delay in passing a full year FY2016 and FY2017 budget creates uncertainty
for the County budget as well as for Public Safety and Public Health services to residents.

As of 8/31/2016 the County is owed $58.8M in State funding, this amount has been as high as
$180M during the last 12 months

10

The FY2017 budget is based upon ac<vi<es presented in the States Stop Gap Spending Plan.

Administra<ve Oce of Illinois Courts (AOIC) reimbursement reduced by 6 percent

The Child Support Enforcement programs were reduced by 22 percent
Adult Redeploy program was reduced by 28 percent
West Nile Virus Response program was reduced by 28 percent
Vision and Hearing Screening programs were reduced by 8 percent
Tobacco-Free Communi<es were reduced by 15 percent

Program Reduc&ons:

Appellate Assistance Program an<cipated award of $2 million

Elec<on Assistance grants an<cipated award of $362,500
Motor Thej Preven<on programs an<cipated award of $823,600

Eliminated Programs:

The State must pass a structurally balanced budget to limit the damage to
the local governments, non-prots and the statewide economy

Closing the FY17 Gap

11

FY2017 Preliminary Gap, $174.3

Health Fund Revenues,

$1,700.0

Sweetened Beverage Tax,

$74.6

Management Ini&a&ves, $16.7

Non-Personnel Expenditure
Reduc&ons, $41.6

Personnel Expenditure
Reduc&ons, $31.9

Closing the FY2017 Preliminary Gap

General Fund Revenues,

$1,784.9

Health Fund Expenditures,

$1,739.6

General Fund Expenditures,

$1,919.5

Exis&ng Revenue Above

Prelim Projec&on, $9.5

12

$78.5M of Expenditure Reductions

Personnel Reduc&ons - $31.9M

300 Layos countywide (CCHHS, Recorder and Oces of
President)
297 Vacancy Elimina<ons in General Fund
Non Union COLA reduc<on
Health Benet Savings

Non-Personnel Reduc&ons - $41.6M
Professional and Managerial Services
Managed Care Expenses
Maintenance of Facili<es
Medical, Dental and Lab Equip/Supplies
Other Contractual Services
Various Management Ini&a&ves - $5M
Jury Fees Reduc<ons
Vehicle Fleet Reduc<ons

13

Long-Term Fiscal
Sustainability

14

Revenue Declines

$322,484,789

Amount
13.8%

32.2%
40.8%

$10
$0
-$10
-$20
-$30
-$40
-$50
FY13

A signicant component of revenues decline each year

County revenues do not grow on pace with expenditures

FY16 Projected Revenues

Declining
Failing
to keep pace with inflation $751,957,329

$953,162,729

13.3%

Growing
with economy

$310,722,298

Other Growth/Decline patterns

$2,338,327,145 100.0%

80% of County personnel are unionized

15

FY15 FY16 FY17

County Treasurer
Clerk of Circuit Court
CigareIe Tax
Sheri
FY14

Health Benets and a number of costs tradi<onally increase at rates above ina<on

85% of General Fund Expenditures are personnel related

Expenditures grow faster than ina&on, dominated by personnel costs

Grand Total*

Millions

Sweetened Beverage Tax

Tax Imposed: Includes carbonated soj drinks, fruit beverages (excluding 100% fruit juice), sports
drinks, ready-to-drink (RTD) tea, energy drinks, and RTD coee; both canned and bo`led sugarsweetened beverages and fountain drinks; diet drinks and avored/enhanced water

Exemp&ons: 100% natural fruit/vegetable juice, syrup and powder w/ no added sweetener; 50% or
more milk, soy, rice, or similar milk subs<tutes are primary ingredient; Infant formula; weight
reduc<on/therapeu<c nutri<onal meal replacements; any syrup or powder that the consumer himself
or herself combines with other ingredients to create a beverage

Consumer Tax Rate: $0.01 per ounce based on data from the Rudd Center at the U. of CT (recently used
by the City of Philadelphia though Philadelphia tax set at 1.5 cents per ounce)

$0.01/oz.
Tax Impact
$0.12
$2.88
$0.20
$0.16
$0.20

FY2017 Revenue Es&mate: $74.6M at $0.01 per ounce assuming a July 1, 2017 eec<ve date
Product Type
Can of soda 12 oz. @ $0.99
Cans of soda 288 oz. (24 pack) @ $8.00
Bo`le of soda 20 oz. @ $2.19
Snapple 16.0 oz @ $1.29
Gatorade 20 oz. @ $1.99

16

Fiscal Forecast with Sweetened

Beverage Tax

Without the revenue the County will face signicant

cuts (1200+ FTE) to its Public Safety services

Fiscal Forecast without Sweetened

Beverage Tax

General Fund Financial Forecast

Sweetened Beverage Tax allows the County to

structurally balance budget through FY2019

17

Forecast Without Beverage Tax

Fiscal Forecast - General Fund

FY2017
FY2018
FY2019
General Fund Budgetary Gap without New Revenue
$ (74,600,000) $ (89,000,000) $ (133,000,000)




Addi&onal Cuts Needed to Balance Budget



Increased number of Layos & Vacancy Elmina<ons
$ 46,500,000 $ 20,800,000 $ 41,600,000
FTE impacted
670
200 - 300
500-600

Average daily popula<on at DOC will increase due to the reduc<on of available Public
Defenders and Assistant States A`orney.

Without this tax we would need to eliminate addi<onal 670 public safety posi<ons in 2017

Impacts reforms to reduce jail popula<on due to fewer Adult Proba<on Ocers

Civil and criminal cased and delayed by major reduc<ons of Court Clerks

Fewer Deputy Sheris in the courts

Addi<onal posi<on reduc<ons in 2018 and 2019 for total impact of 1,300 plus public safety
posi<ons over three years

That will result in cri<cal service impacts:

Open the County to more lawsuits due to reduc<ons in the State A`orneys Oce Civil
Division

We are raising the tax to deliver cri&cal public safety services during a &me of crisis in our County

18

Key Initiatives

19

 These proceedings aord juveniles held in custody an ini<al appearance for a determina<on of
whether there is probable cause to charge the juvenile with a viola<on of law

On November 5th the County will begin holding juvenile deten<on hearings on weekends
and holidays.

Doubling our investment in community based an<-violence eorts which includes trauma
informed services, cogni<ve behavior therapy and wrap-around services and supports to
those most vulnerable.

Working with Oce of Chief Judge to reduce residents summoned to Jury Duty by 300,000 ci<zens or
33% annually

In FY2017 jury fee expenditures will be reduced by over $3 million dollars

Public Safety Reforms

The Cook County criminal jus<ce actors worked together to establish a Collabora<ve
Jus<ce Ini<a<ve

Will con<nue reforms in Central Bond Court, including the goal of con<nuing to reduce the jail
popula<on by increasing the # of pretrial detainees who can be safely released
Implementa<on of an automated court reminder program to reduce the failure to appear rate for
pretrial detainees
Data-driven focus on the 18-24 year old emerging adult popula<on.

20

Jail Population Decreases Following Increase in EM

& I-Bonds

34%

61%

65%

47%
45%
43%
42%
40%

10000

9000

47%
46% 9500

40% 39%
38%
36%

51%

10500

As seen in the chart below, the percentage of orders to Electronic Monitoring (EM) and recognizance bonds (I-Bonds) substan&ally increased
as a percentage of all orders at Central Bond Court (CBC) in September, 2013. The jail popula&on began to decline in September, 2013 and
has remained low through the summer months, breaking from a historical seasonal increase trend.

Jail Popula&on v Orders to EM & I-Bonds

35%

56%
56%
54%
51%
50%
49%
49%
47%
47% 47%
45%
45%
43%
34%

53%
51%
51%
48% 48%
44% 45%

Electronic Monitoring and I-Bonds as a Percent of Total Orders & the Popula&on of the Cook County
Department of Correc&ons (CCDOC)

37%

8500

CCDOC Average Daily Divisional Popula&on

70%
60%
50%
40%
29% 27%
28%
28%

8000

23%
23%

20%

7500

30%

10%

7000

CCDOC Divisional Popula<on

21

0%

Sum of EM+Ibonds

As of Aug 2016 the County had less than 7300 detainees in the General Popula6on of the Jail

% of Orders

Millions

FY14

FY16

FY17

Reduction in Square Footage

FY15

FY18

Another 54,000 sq/j will be demolished in 2017

Approximately 82,000 sq/j will be demolished in 2016

FY17 Budget includes funding to consolidate two general

warehouses to one,

Demoli<on of Division I, built in1929; Division III, built in 1973;

and Division XVII, built in 1958 will result in the avoidance of
$188,471,404 in repair costs over the next decade.

Reducing Our Real Estate Footprint

20.20
20.00
19.80
19.60
19.40
19.20
19.00
18.80

Shrinking occupancy approximately 495,000 square

feet by 2018,

Since taking oce, the annual revenue has increased by $2.3

million from leasing ac<vity for at 69 W. Washington

Commitment by 2018 to increase leasing by 60,000 square

feet valued at approximately $1.5 million

Resul<ng in avoidance of $25M in repair costs and

$1.5M in opera<ng costs annually.

Central Campus Health Center will reduce 400,000 feet of

outdated space that cost $128M to repair vs. $118M for new

22

ERP Wave 1
Core Finance
Q1 2017
ERP Wave 2
Budget
Prep
Q2 2017

2017
Time and A`endance
Full Rollout
Q2 2017

ERP Wave 3
HR and
Payroll
Q2 2018
ERP Wave 4
Supply Chain
Q2 2018

2018

2019
Integrated
Property
Phase 1 (Assessor)
Q1 2019

Technology Investments
Integrated
Jus<ce (Data
Bus)
Q4 2016

2016
Home Rule Tax System
Release 1
Q1 2017

Unied
Communica<ons
Phase 1
Q2 2017

2020

Integrated
Property
Full Rollout
Q1 2020

Combined over $100 million investments will allow the County to deliver streamlined
and enhanced services by leveraging latest technologies

23

CCHHS Strategies

Expand Behavioral Health Porpolio

Fully integrate behavioral health into primary care, specialty care,
emergency departments.
Employ strategies to reduce emergency room and jail visits such as the new
Community Triage Center in Roseland.
Expand substance abuse treatment strategies through Assisted Outpa<ent
Treatment (AOT), Medica<on Assisted Treated (MAT) and naloxone
educa<on and distribu<on.

Improve the Pa&ent Experience

Con<nued expansion of hours at community health centers, enhanced care
management, pa<ent support services, pre-registra<on.

Modernize Facili&es
Construct central campus health center to replace Fantus Clinic (1959),
regional outpa<ent center in Provident community and modernize other
facili<es.

24

Employ Modern Stang Models

Sta to volumes and for strategic growth (Behavioral Health, Surgery, Labor
and Delivery, Cri<cal Care, Care Management).

In Millions

$502.0

$401.1

$213.8

$62.5

$543.0

$403.3

$192.6

$561.0

$387.9

$190.7

$316.4
$110.0

$370.0
$315.6
$92.7
$71.3

$151.6

$65.0

$141.4

2015

$60.8

$136.4

2014

$61.2

$149.5

2013

$450.0

$293.6
$41.0

$503.0

$295.6
$17.3

$184.3

$94.0

$172.4

2017

$80.2

2016

Tax Alloca<on for DPH and Correc<onal

2012

Statutory Pension & Legacy Debt Service

Uncompensated Care

$124.8

$342.0

CCHHS Allocation Continues to Decline

$600.0

$500.0

$400.0

$300.0

$200.0

$100.0

$0.0
2011

Tax Alloca<on for Hospital and Ambulatory

25

56.0

44.0
45.6

54.4

2013

63.5

36.5

2014
Uninsured/ self pay

Insured

2015

32.3

67.7

*2016

32.6

67.4

Insurance Status of CCHHS Pa&ents

CCHHS Payor Mix Continues to

Improve
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2012

*FY2016 represents rst 8 months

26

 Present budget for Board

vote

Amendments must be
budget-neutral

Amendments will be
presented over next 3
weeks

Pass Budget

November

FY17 Budget Schedule

Oct. 13 Early Nov.
Gather Feedback

Hold department hearings

with Finance Commi`ee
Hold public hearings
(North, South, West, City)
Incorporate feedback into
budget revisions, as
necessary

Dec. 1, 2016 Nov. 30, 2017

Budget
Accountability

Monthly STAR review

sessions

Budget controls via

quarterly reports &
alloca<ons

27