City Hall

City Hall

Splitting the bill: A look at whether city, county funding agreements are fair

May 15, 2017

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In the dozens of agreements between the city of Lawrence and Douglas County, the details about who pays for what differ from case to case. And in some instances, the details aren't even written down.

“The city of Lawrence and Douglas County have a long history of cooperative agreements, some which go back more than 50 years,” said County Administrator Craig Weinaug. “… There's probably 30 or 40 cooperative arrangements, some of which have written contracts and some which don’t. All of them were entered into because both units of government benefited.”

As part of his budget recommendations, City Manager Tom Markus suggests reviewing the agreements between the city and the county. Both Weinaug and Markus agree that collaboration saves both governments money and are interested in pursuing additional arrangements, but how to divide the costs may be a more difficult question.

Markus’ main point is that when costs are divided between the city and the county, Lawrence taxpayers can end up contributing more than non-Lawrence residents for the same service. Markus said the proportion of the costs paid by taxpayers in Lawrence, surrounding cities and unincorporated Douglas County should be understood.

“These conversations just can’t occur back and forth between the staffs and some of the elected officials and not have the public understand what these implications are,” Markus said.

Who pays for what

Property taxes levied on behalf of the city and the county support collaborations such as the Lawrence-Douglas County Fire Medical Department, Health Department and Household Hazardous Waste. Both the city and county also provide funding for the Dwayne Peaslee Technical Training Center, economic development and other programs. Various outside agencies also get support from both city and county tax dollars.

Markus said when considering funding proportions, it needs to be noted that Lawrence properties make up 74.5 percent of the county’s tax base. Markus said because Lawrence residents are also residents of Douglas County, they pay for collaborative services once through their city taxes and again through their county taxes. As a result, Markus said in some instances a Lawrence resident effectively pays more than a resident of Douglas County living outside Lawrence city limits, or in nearby cities such as Eudora, Baldwin City or Lecompton.

For example, Markus said if the county pays half and the city pays half of a service, it isn’t actually a proportionate distribution.

“If the county provides 50 percent, that means 74.5 percent of that 50 percent is provided by the Lawrence taxpayer,” Markus said. “… So you have to kind of look at the different ways that you could fund these things.”

Weinaug noted that for some services, such as the emergency dispatch center, Lawrence residents are the vast majority of those using the service. He also said that although residents of cities outside Lawrence may not contribute toward a Lawrence-Douglas County service via their city property tax, they do contribute by paying Lawrence sales tax.

“So if I need to shop for groceries and I'm in Eudora, I don't shop in Eudora, I shop in Lawrence,” Weinaug said. “So as a result of that, the residents of Eudora, Baldwin and Lecompton are taxpayers to the city of Lawrence.”

Renegotiating

Still, Weinaug said it’s not uncommon for agreements to be reconsidered, and he is open to that. As far as how funding proportions should be determined, he said many services have various funding sources in addition to the city and county — including state, federal or private funds — and he isn’t sure that drilling down to individual tax burden is the way to do it.

“The blurring of who is paying for what, if that gets to be the topic, it rarely leads to an agreement,” Weinaug said. “What leads to an agreement is finding mutual benefits for both parties and increases in efficiencies and services for the taxpayers of Douglas County and Lawrence.”

Markus is not the first city manager to bring up the intergovernmental agreements between the city and the county. Though he said it’s a challenge, Markus said his approach is to move toward greater equity, especially with future collaborations.

“What I’m trying to do, going forward with new arrangements for collaboration, is to move toward a stronger position of equity,” Markus said. “That’s where I’m trying to make the progress.”

Mayor Leslie Soden said she thinks the public discussion is important, but that the commission needs to be careful with how it approaches the topic.

“It’s a fair point to make, but coming up with solutions to adjust that seems to be a real can of worms,” Soden said. “So, if that’s an issue we want to start addressing, then we need to make sure we do it in a way that is fair to everyone involved, that just doesn’t look like we’re trying to push expenses out onto people that live outside the city limits.”

New collaborations

Since coming on as city manager, Markus has emphasized that he is impressed with the level of cooperation between the city and county, and he thinks even more can be done. Markus said he sees additional opportunities for combining services, including public works, parks and recreation and the public library.

The topic is likely to come up as part of the city’s budget discussion this summer, as the city is considering building the first phase of new police headquarters that would allow it to co-locate with other law enforcement agencies. Weinaug said he thinks using the city’s proposed police headquarters as a future home of the Douglas County Sheriff’s Office is a great idea.

Both Soden and Markus said they are also interested in potentially combining those agencies at some point. Soden said it just makes sense to consider more collaboration.

“Just in my opinion, if there’s facilities that we can share and work together out of, I think it's a good idea to look at,” Soden said.

Soden also said she is pleased Markus is working harder to put agreements into writing, and that she thinks any new agreements or changes should be done in a formal, public way going forward.

“It seems in the past that they were more flexible in what they did, but then when you have a commission change or city manager change, that seems to upend the verbal agreements that were made when the new parties don't have a written record of that,” Soden said. “So I think it is really important to start getting these agreements in writing with full understanding of both parties.”

Even with the issues at hand, Markus said the collaborations are beneficial to both governments.

“If you choose not to provide a collaboration and instead you decided you were going to have two separate departments, that would be a much worse environment than even a collaboration that is not entirely equitable,” he said.

No matter the approach, past and future collaboration are likely to be the topic of discussion between both governing bodies. Weinaug said he is happy to have those discussions.

“I think the bottom line that I want to emphasize is a positive one,” Weinaug said. “We are very happy to renegotiate those agreements toward the objective of making those agreements better for all the taxpayers.”

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