Happy Mother’s Day

I would just like to take a moment and wish my mother Sandy, my sister Daphne, Tiffany, and Wendy a very happy Mother’s Day.  You are all special and wonderful mothers.  This was always my mother’s favorite gift on her special day.

Mothers Day

 

Here is hoping to all of, the special moms in my life, that you all have a wonderful and blessed day in whatever you decide to do.

While Politicians Pontificate – Business Suffocates

BusinessesIllinois is one of the most expensive places to live, work, and raise a family.  The “collar counties” of Cook are highlighted for all to see.

Now, an article posted at ChiefExecutive.net has ranked the the worst and best states to conduct business.  Illinois slides in at 48.  Shocker.  Illinois only bests New York (49) and California (50).  At what point do people wake up and say, “what we are doing is not working”?  Look at what one CEO said about the Land of Lincoln:

“NY, CA, & IL make it hard to desire to do business there due to deeply-rooted and ineffective socialist bureaucrats who get in the way with their secular social engineering and inherent distrust of business. They represent ‘ankle weights’ to focused business people trying to serve others with value, quality, and responsiveness. High taxes, legal ‘lottery’ justice, and costly union-first commercial complications make you desire to see the consuming public relocate away from these ‘upside-down’ population centers in spite of their historical importance.”

There are a lot of problems here in McHenry County and Illinois.  The way our politicians run government and make appointments to boards is nothing short of a glorious, spectacular failure that you see featured on some trashy cable network news program.  You reach for the remote and try to change the station but its too late.  You cover your eyes but peek through the cracks of your fingers.

Mike Madigan has been in Springfield longer than I have been alive… I am 40.  Why on earth do citizens of Illinois allow our politicians to kick the can down the road.  There is no accountability.  The pension problem in Illinois is starting to make national news.  Everyone is watching.  The data from the article isn’t any better.

79,458 citizens left the state of Illinois in 2010-11.  We are losing population.  Moreover, these are taxpayers.  These are producers.  These are the ones who Springfield continues to abuse.  Here is another quote:

“Illinois—a complete and utter disaster when it comes to fiscal management. The inability to address key issues that are driving debt and instead increase the tax burden on businesses AND residents is mind-boggling. This is precisely why I intend to move my company to FL or TN.”

Jimmy Johns will begin its exodus later this year.  Caterpillar is cutting its workforce as it continues to plan its exodus.  State Farm is moving to Texas.  Go ahead and google “leaving Illinois for Indiana”.  It is depressing.  The citizens of Illinois are fleeing oppressive government and a poor economic environment.  This poor economic environment can be directly attributable to those in Springfield.  The leadership refuses to pass meaningful pension or tax reform.

Illinois ExodusIn Domestic Migration we rank 50th.  We are dead last in people who migrate into Illinois.  People are leaving in droves.  Many who stay say they are “stuck”.  Now there is a pleasant thought.

Why is it that people cannot wait to get out of Illinois.

The solution to this is to start electing people at the local level to stop the taxation locally.  If you look at your tax bill you will be able to “Rack n Stack” which agencies are taxing you the most.  You find out that we need a lot of new faces on local school boards.

We need a new focus on transparency locally.  Many people think we are doing a good job.  We can do better.  Much better – and we are not as good as we think or some would have you believe.

Finally, elected officials need accountability.  The voters in McHenry cannot have impact on elections in Kane or Cook… but the voters can have impact here in McHenry.  It all starts locally.  Perhaps this simple statement from a CEO says it best:

“Living in Illinois… this state is too “corrupt”.

Expensing Questions for the Board

mc-mental-healthAnalyzing the expense report as presented by the McHenry County Mental Health Board (McMHB) only opens up the board, and the budgeting process, to more questions.  The analysis can only leave the reviewer wanting to ask more questions about where the money is going and what the decision making process is.

The bottom line is that McMHB spent $712,117.20 more than it budgeted for on salaries and administration – this is an overage of 18.80 percent.  Even utilizing the most liberal interpretations of the Generally Accepted Accounting Principles (GAAP) – this is demonstrable.  Every penny matters.  If this budget balance sheet were turned in as a graded assignment in a college accounting course the grade would be an F.  Or, if you were conducting an audit you would inform your client that they had a serious problem.

As presented earlier – the salaries reported by McMHB and those reported by McHenry County do not match.  They are not even close.  Even when subtracting line items that might contribute to the total value of the salaries in the McMHB expense report, it still not equal to what the county reports.  In the expense sheet below you will see the real numbers using county data of what McMHB spent money on salaries as well as what McMHB expensed.

Over-Spending

McMHB dispersed $1,231,881.78 on the budget balance sheet line item “Salaries” in 2012.  The salaries exceeded the budget by $304,726.78 or 132.87 percent.  McMHB has 31 paid employees.

McMHB dispersed $324,831.60 on the budget balance sheet line item “Health Care Plan Premiums” (including dental) in 2012.  The premiums exceeded the budget by $84,813.60 or 135.34 percent.  22 employees opted for insurance and nine employees opted out.

Question:  Do we need to pay 31 employees $1,556,712.88 in salaries and healthcare to ensure $13,149,254.96 is facilitated to those organizations in McHenry County that serve the mentally ill (MI) and developmentally disabled (DD)?

Over budgeted line items have been annotated in this graphic.

McMHB spent $712,117.20 more than it should of or 118.80%

If a business ran its budget like this – that business would be out of business.  The taxpayers of McHenry County are not ATM machines that can simply fix bad situations with additional spending.  There needs to be an accounting, an audit, of what exactly is going on.

More Overrun Problems

McMHB dispersed $104,310.50 on the budget balance sheet line item “Contractual Services” in 2012.  The contracted services exceeded the budget by $14,838.50 or 116.58 percent.

McMHB dispersed $18,144.00 on the budget balance sheet line item “Janitorial Services” in 2012.  The amount janitorial services exceeded the budget balance sheet by $4,144.00 or 129.60 percent.

McMHB dispersed $12,889.53 on the budget balance sheet line item “Printing” in 2012.  The amount exceeded the budget balance sheet by $7,584.53 or 242.97 percent.

McMHB dispersed $65.027.02 on the budget balance sheet line item “Telecommunications” in 2012.  The amount exceeded the budget balance sheet by $5,963.02 or 111.99 percent.

ESBMSE

ESBPDF

McMHB dispersed $7,988.44 on the budget balance sheet line item “Leasing” in 2012.  The amount exceeded the budget balance sheet by $4,988.44 or 266.28 percent.

McMHB dispersed $453.08 on the budget balance sheet line item “Repair & Maintenance to Mach & Equip” in 2012.  The board did not allocate any funds for this budget balance sheet line item.

McMHB dispersed $11,434.80 on the budget balance sheet line item “Physical Plant Maintenance” in 2012.  The amount exceeded the budget balance sheet by $4,631.80 or 168.08 percent.

McMHB dispersed $ 171,081.39 on the budget balance sheet line item “Building Expansion” in 2012.  The amount exceeded the budget balance sheet by $24,147.98 or 116.51 percent.

County Board Member Paula Yensen
is the liaison between the
county board and McMHB.

McMHB dispersed $290,147.98 on the budget balance sheet line item “Legal Services” in 2012.  The amount exceeded the budget balance sheet by $240,147.98 or 580.30 percent.

McMHB dispersed $1,763.00 on the budget balance sheet line item “Three Year Plan” in 2012.  The board did not allocate any funds for this budget balance sheet line item.

McMHB dispersed $2,739.79 on the budget balance sheet line item “Travel – Out of County” in 2012.  The board did not allocate any funds for this budget balance sheet line item.

McMHB dispersed $81.54 on the budget balance sheet line item “Fuel, Oil, Grease” in 2012.  The board did not allocate any funds for this budget balance sheet line item.

McMHB dispersed $2,739.79 on the budget balance sheet line item “Travel – Out of County” in 2012.  The board did not allocate any funds for this budget balance sheet line item.

McMHB dispersed $10,000 on the budget balance sheet line item “Fund Balance Set Aside” in 2012.  The board did not allocate any funds for this budget balance sheet line item.

There are so many questions that need to be answered with this Budget Balance Sheet statement.  The difficulty comes with where to begin.  There serious and valid questions of what these line items mean.  In most budgets there is a line item with a description.  Moreover, if the accountant has an issue with a figure they have the option to put in supplemental information to make the information easier to understand for anyone who is reviewing.

We can look at the accounting of salaries and administration and realize something is not adding up.  However, what happened with McMHB where they had to spend $240,147.98 on legal fees?  This is an automatic trigger for filing at a minimum a memorandum for the taxpayers explaining why the legal fees were so expensive.

Clearly, this news article from from the Northwest Herald shows that County Board Member Paula Yensen has seen some invoices that total $83,556 dollars.  Has Mrs. Yensen seen the entire legal expense report?  Where is the other $156,641.98?  Remember, the board only budgeted $50,000.00 for legal issues.

The board needs to move on fixing this issue.  The taxpayers of McHenry County are generous and want to help those who cannot help themselves or need help.  It is evident – if nothing else – that we have an allocation of funds problem.   Now is not the time for partisan politics and bickering.

Fox River Grove Fire Protection District… You Are Doing It Right

As news begins to trickle out about how much our taxes are going up I wanted to report on some good news and some good people.  The folks in charge of our Fox River Grove Fire Protection District are doing something right – they lowered your taxes.

FOX RIVER GROVE FIRE PROTECTION DISTRICT
2011 – $1,377,471.22
2012 – $1,271,682.99 (-7.7%)

They lowered their taxes by 7.7% according to Cal Skinner’s McHenry County Blog.  You can read his breakdown here.

This is good government.  These are people who realize the economy is tough and we cannot afford more spending.  These trustees are holding the line and need to be commended.  So when you open your tax bill and you see the huge jump do not blame the Fox River Grove Fire Protection District.  They did something right.

 

McHenry County Mental Health Board is an (Expensive) Administrative Nightmare

mc-mental-healthThe McHenry County Mental Health Board (McMHB) is the picture perfect example of everything that is wrong in government.  The McMHB pays out 20.96% in salaries and administrative costs.  This is absolutely unacceptable.  For every one dollar collected 21 cents go to keep the lights on and pay 31 employees.  This is so inefficient and is denying resources to the people who are supposed to be served by McMHB.

Simply put, there is not a true “budget” that is available for inspection to the public or to the county board.  So the first question we really have to ask is, why give any agency any money if they cannot provide a budget that meets the Generally Accepted Accounting Practices or GAAP.

McMHBJAB

The closest thing you can find to a budget is in this document – The McMHB Agenda for the January 22nd, 2013 meeting.  This document has not been audited by any third party and is from internal sources.  The budget line items start on “Packet Pg. 10”.  

Money not spent on treatment, but on Salaries and "Administration"

Money not spent on treatment, but on Salaries and “Administration”

If you closely examine the top right hand corner you will see the document starts on “Financial Page 2”.  Where is “Financial Page 1” and where is “Financial Page 4”?  They may be title pages or they may be blank, but where are they?

When you look at these documents you will see that they have been printed, then scanned, and then inserted into this document.  This is by design as to not allow people to easily examine the numbers.  If you want to run any analysis in Microsoft Excel you cannot simply use a program that takes PDF data and turns it into a spreadsheet.  You can either file a Freedom of Information Act (FOIA) request or you can type it in yourself.

I have taken the time to type it in myself and you may download the Microsoft Excel spreadsheet here.  Full transparency.  In entering data I allowed Microsoft Excel to perform all calculations where possible.  You will notice that there are rounding discrepancies.  The numbers are the same as far as the amounts; however, rounding is inconsistent.

McMHBSADB

On the first tab on the bottom left labeled “2012 Revenue” we can see that the McMHB did not receive all the funds they thought they would.  The board thought they would receive $13,522,799.25 but instead only received $13,149,254.96.  This shows that the McMHB is well funded.  The taxpayers of McHenry County are concerned and care about those who are mentally ill and developmentally disabled.

The second tab labeled “2012 Administration” is disturbing.  Starting at the top you will see Salaries.  The salaries presented by McMHB do not match up with what the county website is reporting.  There is a discrepancy of  $380,713.10.  In calculating the cost of salaries I was careful to remove line item 6 (Salaries) and line item 11 (2012 McMHB Expenses Healthcare Plan Premiums) as they were factored in at the county.

2012 McMHB Expenses

Click to download a PDF file of the expense report as filed by McMHB.

What you end up with is the McHenry County Mental Heath Board has a salary and administration rate of 20.96 percent.  This is horrible.  This is not “good value” for our taxpayer dollar.  Money is not flowing to the people who need it but instead to the bureaucrats who thrive on it.

Lots of money flowing into Salaries and Administration on the McHenry County Mental Health Board.

Lots of money flowing into Salaries and Administration on the
McHenry County Mental Health Board.

We have to fix this.  You can run a $13 million dollar program on $450 thousand or about three percent of the total budget.  It isn’t rocket science, its good management and stewardship.

In this example you can see that the Mental Health and Addiction Network spends 3 percent on Salaries and Administration.

More is not better.  
The Mental Health and Addiction Network spends THREE PERCENT while the McHenry County Mental Health Board spends 20.96 PERCENT!

We will start looking at the expenses claimed by McMHB and see why so many of the line items are drastically below what was allocated.  We will also start looking at the overages and why some line items are completely out of whack.  Lets hope the county board moves quickly to confirm Mr. Scott Summers who will bring integrity and fiscal accountability to the board.

 

708 Board Salaries

mc-mental-healthWe have a lot of work to do to start fixing things around McHenry County.  Perhaps one of the most important areas we begin to focus on is our McHenry County Mental Health Board.  We have replaced five members of this board and there is a perception, rightly or wrongly, that things just are not working right on the board.

As we begin to “peel back the layers of the onion” we need to identify how much of the budget is going to salaries and administrative costs and how much is going to help those people who truly need it.

As an example of the methodology I will be using  I would like to introduce you all to the Combined Federal Campaign (CFC) Charity Guide which you can download here.  This is an invaluable tool which allows our military members and federal employees to measure how much of their donation goes to help a cause and how much goes into “administration”.

In this example you can see that the Mental Health and Addiction Network spends 3 percent on Salaries and Administration.

The Mental Health and Addiction Network
spends three percent of its budget on salaries and administration.

Three percent on salaries and administration is a superior rating.  You can feel pretty good that only three cents of every dollar you donate to the Mental Health and Addiction Network is going to pay salaries and administration while 97 cents of every dollar you donate goes to treating those who need it.  Now look at the American Cancer Society.

American Cancer Society

The American Cancer Society
spends almost 20 percent of its budget on salaries and administration.

Where is your charitable dollar getting the best value?  The best bang for the buck?  If you download the guide you can review many charities to see just how “charitable” they really are… to their CEOs.  So with this in mind lets look at the McHenry County Mental Health Board which I will refer to as “McMHB”.

I am providing this data in both a downloadable PDF format as well as an unlocked Microsoft Excel Spreadsheet for transparency.  You can then compare and contrast these numbers with the official McHenry County Salary PDF on the county’s website.  It took awhile to break this out but here is what we know about salaries at McMHB:

Click to Enlarge

Click to Enlarge

Here are the key findings as I see them:

  • McHenry County Taxpayers pay $1,231,881.28 in salaries every year for McMHB employees
  • McHenry County Taxpayers pay $305,268.72 in healthcare benefits every year for McMHB employees
  • McHenry County Taxpayers pay $19,562.88 in dental insurance benefits every year for McMHB employees

According to the McMHB website the county taxpayers generously gave $12,520,953 to support those with mental illness (MI) and developmental disabilities (DD).  If you kick in other revenues the total was $14,112,045.  This is a lot of money.

Now – what is the percentage of the tax revenue going to pay for salaries?  Lets “do the math” and figure out how much, as a percentage of the 2011 budget, is spent on salaries:

$1,556,713 / $12,520.953 = .1243 or 12.43 percent
$1,556,713 / $14,112,045 = .1103 or 11.03 percent

Remember, this is just salaries alone.  This does not include “administration”.  Things such as rent, electric, water, sewer, internet, purchasing new computers, printers, office supplies, or furniture (the list is much longer).

Does this represent good value to the McHenry County Taxpayer?  I would like to remind everyone reading this that McHenry County is the 29th most expensive county to live in… IN THE UNITED STATES.

McHenry County is the 29th worst county in America to live when it comes to taxes.  Why on earth are people wanting to raise them higher?

McHenry County is the 29th most expensive county in
America to live when it comes to paying taxes.

We know McMHB has problems right now and we need to start scrutinizing where every dollar is going and how it is being appropriated.  It isn’t enough anymore for us to just rely on boards to make the decisions.  We need full and open transparency, not just with McMHB, but with all of our government agencies.

While some of our local officials think we are doing a good job, we can do so much better.  Uploading data on websites that are not searchable or sortable is not really “transparent”.  I want to help.  I do not want to “lob grenades” into local government agencies for the heck of it.  I am a fixer.  I am a doer.

We need to fix the McMHB… and a good start would be posting the 2012 budget.