County suspends hiring, offers employees voluntary unpaid leave

UPDATE #2: The County’s Finance Director resigned on Tuesday morning, according to La Paz County Human Resources Director Mary Frantz. “Mr. Mancuso resigned from his position this morning. We wish him good luck in his future endeavors,” she said in an email to Parker Live Tuesday.

UPDATE #1: “Our most pressing problem is not having enough funds in the bank to meet our financial obligations,” said Board Chairman D.L. Wilson, who encouraged property owners to pay their second half of property taxes early if possible, saying that “property tax payments result in cash in the bank for the County, without incurring future liabilities. It is a helpful piece of the solution at this time.”

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Vendors have ceased services to La Paz County after not being paid, with the situation forcing the administration to shift its focus, putting hard choices in front of the Board of Supervisors.

The Supervisors took the first of many concrete steps to directly address the County’s financial crisis on Monday, suspending all hiring and overtime and offering employees voluntary unpaid leave from work.

The Board voted unanimously to the ‘next steps’ outlined in a presentation compiled over the weekend by Interim County Administrator Robert Smith and auditor Jay Parke. The actions taken Monday include a complete hiring freeze, suspending overtime pay unless specifically authorized by the Board, offering employees an unpaid leave of absence with the County continuing to cover health and other benefits, offering employees a voluntary reduction of hours for both full-time and part-time employees, with benefits remaining for full-time employees even with the reduced hours, and offering eligible employees voluntary retirement.

The Supervisors also authorized the team working on the County’s fiscal situation to develop both a short-term and long-term cost-containment plan which can be presented to the Board within a short period of time. These plans will include involuntary furloughs up to 25 percent of hours per week for “non-essential employees, as deemed necessary”, and a planned reduction in the workforce including “strategic approaches and timelines, as deemed necessary”. There was little discussion of the possible lay-offs on Monday, as no firm proposals were made to the Supervisors.

Smith told the boardroom that the team had needed to accelerate its schedule and shift its focus from the long-term to the short-term last Wednesday as it became apparent that the County’s cash shortage was causing vendors to suspend services to the County.

“We had to shift our focus to immediate needs,” Smith said. “We will still be working on our long-term plan but our immediate needs are more pressing at the moment and we need to take action sooner rather than later.”

He talked about the need to remediate the County’s relationships with the vendors, and the possibility of short-term loans with vendors was mentioned.

The Supervisors also authorized the team to explore alternative revenue sources for the Jail District and alternative financing options for the long-term. One such alternative was raised by Supervisor Duce Minor, who said that the County may have the option of issuing its own bonds to local investors to raise money once the initial issues have been ironed out and the financial situation is better.

The presentation began with a financial overview by saying, “La Paz County’s current financial crisis is a culmination of limited resources to provide mandated services, striving to maintain the current level of services, reoccurring annual operating deficits from Special Revenue Funds, a decline in revenue from housing federal inmates, lack of centralized processes, and significant deficiencies in internal controls and financial reporting.”

The action plan calls for putting a detailed long-term plan in front of the Board of Supervisors by March 30th.