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  • Writer's pictureCharlene Sims, Journal staff

Commission looks at ARPA funds to cover cost-of-living increase

Updated: Jul 8, 2022

MOUND CITY – As the cost of employee benefits for Linn County employees continues to rise, the commissioners discussed using some of the American Rescue Plan Act (ARPA) funds to cover part of a 5 percent cost-of-living adjustment (COLA) and increased health insurance costs.

On Tuesday, July 5, County Clerk David Lamb reported that his first draft of the 2023 employee benefits budget was going to be about $3.94 million, a $618,000 increase from the 2022 budget. This increase did not include a cost-of-living increase.

Lamb explained to the commissioners that the county’s health insurance was going up by about 25 percent. He attributed this to several factors, including overall industry claims and local claims and an increased cost of healthcare.

He said that Linn County had experienced several good years where the insurance rates stayed fairly level or rose only slightly while insurance rates for the insurance industry were increasing at 5 percent to 10 percent.

He said that part of the budget increase was because additional employees were being added to the payroll for the justice center and that increased the employee benefits.

Lamb told the commissioners that while the Kansas Public Employees Retirement System (KPERS) had dropped the percentage that employers had to pay, the county had to raise it in the 2023 budget because of new employees and higher salaries.

Other items that increased were workers compensation, short-term insurance, life and cancer insurance, and deferred compensation, and health savings accounts (HSA). He said that more employees had signed up for these benefits.

Lamb said that while he had not seen the county’s new rates for unemployment insurance, he felt sure they would be going up. So he increased that line item in the budget.

Lamb said that the cost of giving the employees a 5 percent COLA raise was about $286,000 for payroll and about $57,500 for the employee benefits.

Commissioner Danny McCullough asked if the ARPA funds could be used to help with the budget, especially the health insurance increase and also the COLA.

Lamb said that ARPA funds for COLA might soften the problem for next year, but it will probably continue to rise.

Lamb said his understanding was that, since the county declared the ARPA funds lost revenue, that it opened the county up to use the funds for anything.

Since Economic Development Director Jessica Hightower was off this week, Lamb said he would try to check into it.

McCullough said that he thought ARPA funds should be used first to take care of the county and county employees before handing out more money. He asked about giving the employees a lump sum of money rather than an increase.

Lamb said that he would hate to see the lump sum option over the COLA increase.

In an email on Wednesday, Lamb said that so far the county had paid KwiKom $522,000 and will owe them $58,000 when the broadband job is completed.

And Southeast Kansas Regional Planning Commission (SEKRPC) has received nearly $19,000 for administering the grant for the first year.

SEKRPC is scheduled to receive a total of $95,000, or 5 percent, for administration of the grant. The total grant amount the county will receive from ARPA is approximately $1.9 million.

In the email, Lamb said that $300,000 would cover about half of the increase in employee benefits.

The commissioners tentatively approved the more than $3.94 million employee benefits fund budget but asked Lamb to bring more information to next week’s meeting about the budget with and without the COLA increase.

They also asked that he include the budget with the addition of $300,000 in ARPA funds. Lamb will also check into whether ARPA funds can be used to add revenue to the budget for employee benefits.

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