HomeMy WebLinkAboutMINUTES - 11031987 - 1.35 R Y j• �
TO: BOARD OF SUPERVISORS +
FROM I.JI ltPhil Batchelor, Vra
County' Administrator
°ATE' . October 22, 1987coirty
SUBJECT: .
COST OF DOING BUSINESS ADJUSTMENTS FOR THE MENTAL HEALTH CONTRACTORS
SPECIFIC -REQUEST(S) OR RECOMMENDATION(S) & BACKGROUND AND ,JUSTIFICATION
RECOMMENDATION:
l.- . - Authorize the Health Services Department to increase the payment limit
to Mental Health contractors by $245,000 for a cost-of-doing-business
adjustment during fiscal year 1987-88 .
2. Direct the Administrator' s Office and Health Services Department to
study the feasibility of offering Health Plan services to contractors
` in lieu. of a cost-of-doing-business adjustment in fiscal year 1988-89.
BACKGROUND
During the August budget hearings, the Board requested that the
Adm'inistrator' s . Office and Health Services Department review the -
Contractor' s Alliance request for a $290.,000 . cost-of-doing-business
adjustment to determine the equivalent of employee merit pay and . other
operational cost increases. ' The Board directed . that an equitable funding
arrangement be developed that would correspond to the budget approach used
for County. departments. The cost for insurance is not included in this
report as the Board,. in a separate action, authorized $180,000 for
contractor' s for this purpose
Several meetings. have been held with representatives of the Alliance and a
general approach to studying the issue was agreed upon. A review was made
of the audited. budgets for the two prior fiscal years as well as the
current year budget for three contractors who received . 43% of the County
funds in 1986-87 . Using the same budget review procedures as with County
departments, the following items were analyzed:
1. Salary increases consisting of merit pay and associated benefit
increases, . reduced by personnel vacancy . savings based on prior
experience;
2: Operational expense increases in rents, utilities, telephone and
facility maintenance; .
3 . Existing County programs were considered. and' new programs, and out of
County programs were excluded:
CONTINUED ON ATTACHMENT- x YES SIGNATURE: �
RECOMMENDATION OF COUNTY .ADMINISTRATOR RECOMMENDATION OF BOARD--- COMMITTEE
APPROVE OTHER
SIGNATURE S
ACT 1 ON OF BOARD ON _ ._ F,-?PROVED AS RECOMMIZNDED OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS (ABSENT �`— ) - AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: _ AND ENTERED ON THE MINUTES.,OF THE BOARD
ABSENT ABSTAIN OF SUPERVISORS ON THE DATE SHOWN.
Contractors,'. Alliance
NOV 3 1987
CC: ATTESTED
County Adr.!inistr_ator� s Office
Health Services .Denartment PHIL BATCHELOR. CLERK .OF THE BOARD OF
SUPERVISORS AND COUNTY ADMINISTRATOR
BY
M382/7-83 � ��dfg ___,DEPUTY
Page 2
The results of this review indicated that a 3 . 5% adjustment on the County
net payment limit for fiscal year 1986-87 is appropriate. This adjustment
would require an additional $245,000 in County funds. This amount is very
close to the contractors ' request when factoring in a 3. 5% increase in
other revenues received by the contractors.
Comparing this adjustment with what County departments received is
difficult because of a variety of reasons such as differences in the number
and characteristics of personnel, personnel policies, budget size,
budgeting practices, type of services and revenue generating ability.
However, the 3 . 5% proposed adjustment compares favorably to the 3 .1%
increase in expenditures in the Health Services Department. In general,
the slightly higher adjustment to the contractors is probably because
nearly all contractor employees receive a merit increase while some Health
Services employees don' t since they have reached their top step; some
contractors provide for merit increases above 50, which is the County
standard, and that the accounts counted in the CODBA impact smaller
contractor budgets greater than the larger Health Services Department
budget.
In the process of this review, the Administrator' s Office and the Health
Services Department considered alternative ways of providing contractors
with cost-of-doing-business adjustments in future years. It was agreed
that one avenue which should be explored is offering contractors the County
Health Plan in lieu of a future CODBA. It was estimated that the
contractors will spend in excess of $375,000 for employee Health insurance
this fiscal year.
i