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St. Louis County facing early budget gap for 2018

An increase in wages for county employees, higher health insurance costs and more employees on payroll are helping send St. Louis County's budget higher.

County commissioners on Tuesday got their first comprehensive look at the proposed 2018 budget that — unless cuts are made or new revenue is found — would be up 6.54 percent over this year.

County staff and commissioners have plenty of time to make changes. They don't need to have their maximum levy set until Sept. 26, and the final levy can wait until Dec. 19. But the job won't be easy without a tax increase.

The preliminary 2018 property tax levy budget came in at $135.8 million, up from $126.6 million for 2017. That's the portion of the county's overall budget that comes out of property taxes paid by property owners.

Wages — more employees and negotiated wage increases for existing county employees — make up 65 percent of the increase, or about $6 million. Many county employees received a 2.5 percent pay hike. And the county has been adding workers, in large part to keep up with increased demand for state-mandated services like child protection. The total number of full-time equivalent positions hit 1,825.45 this year, up from 1,779.45 in 2016 and 1,697.40 in 2011.

A projected 12.5 percent increase in health care costs projected for 2018, an additional $2.8 million for employee coverage, also is driving the budget up.

Increased demand for the county's Public Health and Human Services is a big part of the increase as the county moved last year and this year to add more human service employees to meet an increased workload. The department's budget is slated to increase 11.4 percent from 2017 to 2018, from $40.36 million to $44.97 million.

In the child protection division alone, the county added 16 social workers and four supervisors.

Commissioners received their budget briefing at a workshop and took no action Tuesday.

It's too early to say how much of a tax increase, if any, the preliminary budget hike might lead to as commissioners could decide to make cuts or find alternative revenue sources, such as fund balances. The county approved an 8.5 percent property tax levy hike for 2017 after no increase in 2016.

Kevin Gray, county administrator, said commissioners have told him to pare that 6.54 percent hike as much as possible.

"We're making progress at whittling that number down. We'll continue to refine it,'' Gray said, noting that most of the increase is for staffing for state-mandated services that the state doesn't fully pay for. "Especially for vulnerable adults and children, that's where the focus has been. That's where the increase is. But that's where the need is."