The Agenda with the Missoula County Commissioners

It Takes a Village (and Taxes): How Thoughtful Budgeting Keeps Our Community Running

• Missoula County Commissioners • Season 2 • Episode 20

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Budget season is underway at Missoula County, and the commissioners have spent countless hours delving into what funding will be needed to keep up with current services and programs. They’ve also reviewed dozens of budget requests from departments that would enhance these services or pay for new initiatives. They’ve already declined to fund $2.4 million of those requests, and now they’re hoping the community will chime in on the proposed budget for fiscal year 2023. 

In this episode, the commissioners speak with Chief Administrative Officer Chris Lounsbury and Chief Financial Officer Andrew Czorny to provide an overview of the budget and the process that shapes it. They also discuss the top priority for this year’s budget: employee retention and recruitment. 

The increase to the base budget needed to sustain current services and operations is approximately $5.3 million. This includes increases to wages and personnel costs for County employees, who help keep our communities running by answering 9-1-1 calls, plowing roads and filling potholes, running elections, serving as law enforcement and detention officers, rescuing and sheltering stray pets, responding to public health emergencies and much more.

The commissioners opened the budget hearing on Aug. 25 and invite community members to review and provide feedback on the budget.  The more specific feedback you have, the more constructive and helpful it is to them. Review the FY23 budget requests and shareyour comments or questions at https://missoulacountyvoice.com/fiscal-year-2023-missoula-county-budget. They will make a final decision at their public meeting at 2 p.m. Thursday, Sept. 8.

Learn more about your specific property taxes at itax.missoulacounty.us

Text us your thoughts and comments on this episode!


Thank you to Missoula's Community Media Resource for podcast recording support!

Commissioner Vero:

Welcome back to Tip of the Spear with your Missoula County commissioners. I'm Juanita Vero, and I'm here with fellow commissioner Josh Slotnick. Unfortunately, Dave Strohmaier is in isolation, but this morning we're joined by our very own Chris Lounsbury, the Missoula County Chief Administrative Officer, and Andrew Czorny, our Chief Financial Officer, and they're going to talk to us about budget because it's budget season. So, thanks.

Commissioner Slotnick:

Yeah.

Chris Lounsbury:

Thanks for having us.

Commissioner Slotnick:

Yeah, I really like what you said there, Juan, budget season. It's not just a budget process or a budget afternoon, it's a season. So Chris, for all those listening out there, we have dozens, dozens of listeners, Chris, could you describe what budget season is, who's involved and how it works? Sure, you bet. So, if you think about the County's budget like a much larger version of your home budget, that's probably the best way to think about it. And so for the County, that process starts off in spring when Andrew and the finance team works on balancing basically our books, which happens every month, but they look at that global balance for the previous year to kind of know how we're going to start off the next year. And then based on those numbers, they develop what we call the base budget and that is the amount that we think we're going to pay the next year just to cover the same things that we did the last year. And then from there, they bring those numbers to you, the commission, but also to all our department heads. And we begin to sit down and talk about what additional things the county might want to take on in that next year. And so that's kind of what our spring looks like. And then as we roll into summer and we head towards June, we begin to put together what we call the preliminary budget. And so that's the chance where the commissioners go and meet with each of the department heads about what their requests might be and for new things, not for the things that we're going to keep doing that we need to do every year, and then we bring that out to the public once you all have had a chance to make decisions on that. So the reason I use the home analogy is because you can kind of think about it the same way you might set a budget for a year for a home or for a business, right? You sit down, you look at the year that just happened and say what went well? What didn't go well? What other things might we want to do this year? Do we have to replace the hot water heater? Do we need to go visit our family because somebody's sick? What are the things that are going to come up over this next year? So that's kind of that first phase. And then you take those new things and you look at what you're going to have for income and you say, well, how can we move things around to make those things happen or what things can't we do? And so right now the commission is in that process, right? We just finished the what can we and can't we do? You had that presentation last week from Andrew on your preliminary budget that has the things that we need to do that are all the things we provide for services every day, and then what new things might we take on? You mentioned the income side. I want to bring that up just because it's something I think most people don't understand, maybe even people who follow local affairs don't really understand the income side. Do you guys mind talking about that a little bit and thinking about things like mill values and property taxes and can we just raise as much taxes as we want and how does that whole system work?

Andrew Czorny:

Well, the state has an equalization process where they cap the mills we're able to levy and it's based on the taxable value of the area that we live in. So Missoula County has a taxable value that's calculated every other year by the Department of Revenue. From that taxable value, we derive what the mill value is. The mill value is 1/1000 of the value of the property. And from that we're able to then calculate the number of mills you're able to levy in any one jurisdiction. And we're near our cap. We haven't levied near our mill cap because we've been very conscious of taxpayers and their ability to pay the property taxes. We want to minimize the impact on them. We've gone ahead and provided you with what we believe is a solid budget looking forward and one that we can sustain.

Commissioner Slotnick:

So I think, Andrew, another part that might be really helpful when we talk about the mill value and the mill cap is how we understand the way that that number grows, right? Which is the idea that if you look out right now, and people, I think were all experiencing this or paying much more when they go to the grocery store, to the gas pump, to the hardware store, any place they might go. But we're kind of limited. We don't actually look at inflation in the same way. So maybe you might like to share how that works?

Andrew Czorny:

Yes. The Department of Revenue they have every other year a reappraisal process. This is not the reappraisal year. In the off year, all we get in terms of increases in our mill value is any newly taxable properties that come onto the tax roll, plus half the three-year rate of inflation, which is something legislature inserted. And that's all the increase we would have in this year. Next year, the department will go out and reappraise all similar properties across the state and the value of those homes will go up and that will provide additional capacity to issue mills. It's a difficult tax, because it's an archaic tax. A property tax has nothing to do with your ability to pay. So that's very difficult for people on a fixed income when their house goes up in value and they end up paying more property tax.

Commissioner Slotnick:

So if I just want to try and rephrase this, just for clarity's sake, so the state takes a look at all the real estate across the entire county and they appraise that, but they don't appraise it in the way that you might have your appraiser come, you're about to sell your house and somebody comes and looks at comps and square footages and your yard and all of that. They use some type of an algorithm based on square feet. They don't actually look. So the appraised value isn't the same as market value. So the state comes up with this appraised value for all the real estate in the county, and then you divide that by 1000 and that number, that's the mill value. And then the state says, well, you can levy the same amount of mills as you did last year, plus this inflationary increase you're talking about, that half the three year average, and that's the total mill. So we have the total number of mills and then we have the mill value. You do some math and you get the total amount of money that could be levied by county government for taxes if we chose to.

Andrew Czorny:

That's correct.

Commissioner Slotnick:

But as you're pointing out, we didn't choose to max out. We chose to be judicious because we're aware of the effects this has on people. And so we look at what we could do, what we assume people could handle, and then, as Chris is pointing out, what do our departments and our staff say they need to be able to do the job of providing services to meet the level of expectation of the public?

Commissioner Vero:

You did say this is an archaic system. Can you explain that a bit more or what can be done to make it less archaic?

Andrew Czorny:

I think if it was somehow related to people's ability to pay their taxes rather than the value of their home, it might have made sense in old England when somebody's net worth was contained in their castle or their lands and they were taxed appropriately on that. But now your net worth isn't contained in your house, it's contained somewhere else and has nothing to do with your ability to pay. So if we had a tax that was more income based, or if we had a local option tax or something similar to that, where we take some of the pressure off the taxpayers that are on a limited income, fixed income, and put it on people that are using the services that we provide but not paying for them and making it more of an income based process, that would make much more sense to me.

Commissioner Slotnick:

There was a time when our tax structure kind of worked and that was back when we had major industries in Missoula that had big geographic footprints and paid it a lot in taxes. At that same time, I'm thinking about like the first half of the eighties, maybe going into the late eighties and the seventies before that, where we had low residential home values, high industrial values, so the mills were paying a lot in taxes, and we had functionally no tourists. So we didn't have people coming here and using services and not paying for them. Well, we have that same exact tax structure right now and a completely different economy. Those big industrial footprint landowners are gone. Residential property values are super high and we have millions of tourists using services and we're subsidizing. The whole structure is off. I really like what you're saying, Andrew, looking for something more income based rather than saying your home is a proxy for your ability to pay.

Andrew Czorny:

Yeah, and we have so many visitors coming into the county each year, as you know, and using our services. It would be nice to get some of that income that they provide into our community to use for our roads and our services that we provide for that extra population we get each year.

Commissioner Vero:

So what's been the focus of this budget or the priorities of this budget? Is there like a North Star or guiding principle for this particular FY 23 budget?

Commissioner Slotnick:

Yeah. So I mean, I think commissioners, the big thing, you'll recall we came to you as a leadership team this year and said we really need to focus on retention and recruitment of staff because we've had real challenges, just like everyone recruiting in this current market and also retaining the valuable staff that we have that we invest in. And so that's been the main focus this year. We've gone back to our partners on our collective bargaining agreements. We've looked at the non-union personnel plan to try and help folks as wages have needed to adjust because cost of living in Missoula has needed to adjust. And so that's been a really large process this year that's had a particular impact on the budget and has limited our ability to consider other things. But when we had that conversation, the commission understood, I think, well the fact that these are kind of unprecedented times. Right? We typically see large number of applicants for jobs. No one's seeing that right now in the Missoula market and housing and other things have significantly increased over the last few years coming out of the pandemic.

Commissioner Vero:

I get hung up on the word services because we get comments from folks out in the rural area where I am saying "we don't need services out here," and how can we change that language or help folks understand what the county does provide? Because yes, you do need a road if you live out in Greenough.

Commissioner Slotnick:

And one of the things I've always struggled with a lot of times folks want to equate the word services to customer service, right? So they want to do that. But really, when we talk about government, we need to talk about public services. The idea behind government is that we all pool our resources to be able to afford public services that we wouldn't be able to afford individually. And while it's true that folks in rural communities may not use those services as heavily as folks in an urban area, when you look at the public services that the county provides they're really used by all residents. So that starts with everything from when you dial 911, it's a county employee who answers that phone call. If you're in a rural area, it's a county first responder who's coming to from the sheriff's department, both municipal and district court judge services come from the county as part of that, if you need to register your vehicle, that's a county service. You know, if you have a child who's sick and needs immunization services, that's a county service. It really is public services that we're talking about. And so while folks might not think that they're using those services when they're in a rural area, the reality is we all use those services every day, but we kind of take them for granted because they're kind of behind the scenes and we don't see them. The roads that we drive on another public service. Right? None of us could afford to pave a road individually, but collectively we're able to do that. And so it really is this public service piece more than this customer service piece, I think that folks need to focus on, which is that idea that when we pool our resources, we get services that protect not only the young but the old, but also the gamut in between. Right? We may not need that service today, but I would be willing to bet that everybody has had an experience in their life where they have needed those or they know someone who needs those services and they don't mind when it's somebody that they know. Very well said. You said something in there that really resonated with me around it kind of being invisible or we take them for granted. I think we have a tendency to think that all out in front of us in the physical world just is here. And it's here because we're here and that's how life is. If we were going to leave this office and go walk out on the street and look around, all of those things on that streetscape came to be in part because of some public investment. There's private investment for sure, but the private investment happens on top. Those public services you described I like to think of as a foundation. And upon that foundation we can build entrepreneurship, cultural efforts, nonprofit efforts, all kinds of things, but kind of metaphorically and literally, were it not for public investment, we would be spending our time chopping wood and hauling water. Instead we don't have to worry, in this case we're in the city right now, that you could turn the tap on and water is going to come out or you can flush the toilet. We can spend our time working on these other things.

Chris Lounsbury:

Yeah, that's absolutely right, Josh. And the other piece that goes with that, I mean, if you think about it, those are the investments going back a few generations, right, that really led to the foundation of lots of things. You go back to folks like Benjamin Franklin, right? First public library, first fire department. These are all communal services, right? That people really benefit from. You konw, education, all of those come from that ability to pool resources because none of us could afford to do it on our own.

Commissioner Slotnick:

Yeah, it goes around and through the interstate highway system to broadband, to sewage treatment centers. Without these things, life as we know it would be really difficult to continue on.

Commissioner Vero:

And then talking about the services, how important it is to have the very best employees and retain and recruit. I mean, that is what we need to do. We have 855 employees?

Commissioner Slotnick:

We have 855 what we call FTEs or full time equivalents. So that's about 1000 people filling about 855 jobs, some of them part time, right? So there's two people who might be filling a role versus one. But I mean, if you think about it and I always revert back to, you know, the emergency service world because it's the way I started my career at Missoula County, but, you know, it takes a year to train a 9-1-1 dispatcher because we want really qualified, skilled people to answer those positions. The same thing is true for law enforcement, for detention, you know, and even the folks who are building roads or answering the phones in the courts, it's a long training process. And we want people who are skilled because when people come and use those services, they're often having their worst day. And we want them to be greeted by our best day, right? Our best ability to deliver them the service that they need. And that's true whether it's in motor vehicle, Clerk of District Court, Justice Court, you know, the health department, that's all part of that. And it's the people who make Missoula County as a government function for the public at large and so that those services stay invisible and it's not only hear about it when there's a problem, right? We don't want to be in the news for those things. And you used the word North Star. I really like that. And for this year it was retention. We want to make sure we have our employees, as you just said, Chris, well compensated so they can remain here so they don't leave and in place and ready to do their work.

So Andrew and Chris, we get asked this very straightforward question often:

how much are my taxes going to go up? What do you suggest as an answer to that?

Andrew Czorny:

Well it all depends. Chris?

Commissioner Slotnick:

Depends on whether you live in the city or whether you live in the county. And part of it is also where you live in the county, right? Because if you're in different parts of the county, you have different fire jurisdictions, you might have a cemetery district that might not exist in another part, so it's different for every person. But the county has a really great tool that Andrew and his team have developed, and Andrew, you might want to talk about. We jokingly always refer to Andrew as Pie Chart Czorny because he's good with numbers and graphs, and so he's got a great system on the web that folks can go and look and see exactly where their taxes are going by dollar amount.

Andrew Czorny:

If you want to just go on to the property tax information system and put in your name or address, it will come up and show you your current property tax bill. And then in the center of the bill, there's an icon where you press and it says, look at pie charts, and you can look at the pie chart and it'll divide out how many dollars are going to each entity whether it's the city, county, special districts or schools in the bigger pie chart, and then it will dive down into what goes to the schools, what goes to the county, and the county really breaks it down in very minute detail each and every dollar and what you're paying for. So you'll be able to see that very clearly.

Commissioner Slotnick:

That's great.

Commissioner Vero:

I don't want folks listening to think we're being evasive. So it's just, some ballpark so people have an idea is that if you live in city limits, your tax increase will be approximately per $100,000 of property is $22.70 a year.

Chris Lounsbury:

We used 100,000--

Commissioner Vero:

Yes, which comes out to a $1.89 a month per $100,000. And we're using 100,000 because it makes it for easy math. So multiply that by five, you're like--

Commissioner Slotnick:

For a $500,000 home, it'd be a little over $100 per year.

Commissioner Vero:

There we go. Thank you. So just to help folks.

Speaker3:

Less than ten bucks a month.

Commissioner Vero:

There you go. Outside of city limits, we're looking at roughly $25.05 a year for every 100,000 in assessed property.

Commissioner Slotnick:

Yeah. And that is because there are some what we call county-only mills that are included in there. So for example, if you live in the county, you pay differently than in the city for things like animal control, the health department and for roads, because of course, folks who live in the county are not paying into the city road budget. They're only paying into the county road budget.

Commissioner Vero:

Clear as mud, everyone?

Chris Lounsbury:

Taxes are always fun.

Commissioner Vero:

You got to check out the Czorny charts. That's going to answer everything.

Chris Lounsbury:

They really do.

Commissioner Slotnick:

That really is the best way. And I'm breaking this down by month because that's how most people's household economies work. And when you pay your mortgage, the tax bill is attached to that. It's going into an escrow account. And we're looking at, we're just kind of ballpark something around ten bucks a month. So, yeah, that's real money. And think about what you paid for gasoline and for groceries and for all the other sundries that are necessary for life this year compared to last year. And an extra ten bucks a month is at least what that is. The nature of doing business for the county is we're buying stuff and gear and paying people to provide the services Chris described and we are playing in the same marketplace. So when we go to hire folks and we go to buy stuff, we are also in that same inflationary market and that extra ten bucks a month kind of reflects that.

Commissioner Vero:

We just got a great stat this morning from Shane Stack, who's the director of Public Works, and it costs 15,000 to 20,000 to chip seal a half a mile of road. So this is what we're up against. It's going to be tough out there. So if people have comments, questions about the budget, what's the best place?

Chris Lounsbury:

Yeah. So three different ways that I would suggest folks take a look both at the budget and provide us feedback. The first is Missoula County Voice, which is a fantastic tool that we have for community engagement. You can go online and provide your comments there. There's a page specifically dedicated to the budget. It's right on the Missoula County home page to be able to link to that. The second way is that folks can always email the commission at bcc@missoulacounty.us. And then the third way is folks can give us a call, and the county's main phone number is 406-721-5700. And then they can just ask for the commissioners office.

Commissioner Vero:

And then again, specifics are super important. Of course, you can say that taxes are too high, but it is most helpful if you can be specific and at the same time realizing that government is complex, complicated, it's difficult. We really want you to check things out.

Chris Lounsbury:

If you're wondering what new things the county is interested in doing, those are also up on the Missoula County Voice page as part of the budget requests is what you'll see that linked as.

Andrew Czorny:

Any ideas for new revenues are welcome. Please, please give us those suggestions.

Commissioner Slotnick:

So Andrew, you alluded to this a little bit in talking about an archaic system. If you could wave your wand over the Montana state legislature and have them create a new tax system, what would that look like? And you don't have to hit all the specifics. But just generally speaking, what do you think a more equitable tax system would look like?

Andrew Czorny:

That's a great question. First of all, Josh, you know, and I don't have a very quick answer. It's a complicated one. I think it has to be more income based and it has to be based on usage. We provide services for not only the people here, our residents, but we provide services for hundreds of thousands, literally millions, of people that come to the state each year to recreate. And it's getting more and more popular. So if we had some sort of a resort tax that could cover an area that sees this influx, I think that would be great if it had a one and one offset for property taxes. It has to be done. We just can't go on and continue to live with this type of a system. We need additional revenue, but the existing source is getting overtaxed. We have to have some sort of an income based tax or an outsider sales tax to reduce property taxes on the residents.

Commissioner Slotnick:

Thanks. I had one last question for Chris, too. You mentioned a career with Missoula County, decades in public service. And I know from working shoulder to shoulder with you, you're a crazy smart guy with tons of skills. Why do this? Why do this? You could go work for all kinds of entities. Why are you still in public service?

Chris Lounsbury:

So the reason I'm in public service is because of that definition. Right? You know, the fact is, I started my career out of high school, working in public service. I started off as a volunteer EMT in a little town in Maine, which is where I grew up. And I really saw firsthand that being able to deliver service to people in times of need and crisis is something that's incredibly fulfilling and rewarding. And, you know, I've had the great privilege of growing in my career at Missoula County, starting off in 9-1-1 as a dispatcher answering the phone, working as a volunteer firefighter, an EMT, then working in disaster, then working in the commissioner's office. And it's something new every day. But the ability to serve the public and provide vital services, especially in times of need, is something that keeps me coming back.

Commissioner Vero:

Yeah. So for both of you, why stick it out with Missoula County?

Andrew Czorny:

You have to have a desire to work in the public sector. You're never going to get rich here. It's a sense of service. It's a sense of giving back to the community.

Commissioner Vero:

And why this community. You can go to any state in the nation.

Andrew Czorny:

My dad was an immigrant from Prague, Czechoslovakia, and he chose Missoula because it reminded him of Prague. And so it always has held a very dear spot in my heart and my family's heart. And that's why I want to stay here and support my community.

Commissioner Vero:

Awesome. Well, yeah. Before we close, give us a nugget of wisdom or a good book or podcast that you've read.

Speaker3:

Any slice of culture you've bumped into recently you want to relay?

Andrew Czorny:

I heard a great quote the other day, and it was, "you can't wait for life to be easy to be happy."

Commissioner Slotnick:

That's very good.

Commissioner Vero:

Who said that?

Andrew Czorny:

It was a woman that had passed on from cancer.

Chris Lounsbury:

I don't know that I want to follow that based on what Andrew said. So I'm going to give a book instead. So I've been reading Atomic Habits, which is a great, great book, both about how we think about things, but more importantly, how we rethink about things. And it starts off with some stories about the Man Gulch fire, which was one of the disasters that happened in the Forest Service where lots of folks lost their lives. And he starts off with the idea that, you know, if they had rethought the situation and done what the three folks who had survived that particular fire, if the rest of them had done those same things, would they have survived? And how can we change? We can't always be stuck in the same pattern of the way that we think.

Commissioner Vero:

Atomic habits. Do you have an example of your own personal life you'd like to share with our listeners of an atomic habit?

Chris Lounsbury:

I don't. I'm just starting the book, but I will see if I can come up with one for the next time.

Commissioner Vero:

I'm sorry. Who is the author?

Chris Lounsbury:

Adam Grant.

Commissioner Slotnick:

Nice.

Commissioner Vero:

I'm going to check it out.

Commissioner Slotnick:

Yeah, me too. That sounds really good.

Chris Lounsbury:

Yeah, he has "Atomic Habits" and "Think Again" are the two books.

Commissioner Vero:

Thank you all so much. Thanks, everyone, for listening and we'll catch you next week.

Commissioner Slotnick:

Thank you. Thank you.

Andrew Czorny:

Thanks.

Commissioner Slotnick:

Thanks for listening to the Tip of the Spear podcast. If you enjoy these conversations, it would mean a lot if you would rate and review the show on whichever podcast app you like, and if you know a friend who would like to keep up with what's happening in local government, be sure to recommend this podcast to them. The Tip of the Spear podcast is made possible with support from MCAT, better known as Missoula Community Access Television and our staff in the Missoula County Communications Division. If you have a question or topic you'd like us to address on a future episode, email it to communications@missoulacounty.us. And to find other ways to stay up to date with what's happening at Missoula County, go to missoula.co/countyupdates. And thanks for listening.