The five jurisdictions of the Central Virginia Regional Jail (CVRJ) will likely see a collective increase in contributions next fiscal year, but it’s one of their own choosing.
Last week, jail authority members opted to increase the collective contribution of the localities by $400,000. Originally, the jail’s approximately $16.7 million draft budget was created using the same collective contribution that is in the current budget. To do so, approximately $2.1 million from the fund balance was used. The only changes to the jurisdiction’s individual allocations were due to the funding formula which breaks down the collective allocation by each county’s jail population. Jail population is figured using a three-year average of each county’s inmate days and doesn’t equate to the actual amount of inmates a county has. Because its calculated using a three-year average, the contributions vary as a county’s number of inmates fluctuates.
For fiscal year 2021 which is factored using inmate days in fiscal years 2017, 2018 and 2019, Louisa, with an average jail population of 35,204 days, covers 30.74 percent of the collective locality contribution. Orange trails behind with 30,143 days, 26.32 percent. Next is Greene with 19,896 days has 17.37 percent of the contribution. Fluvanna has 16,700 days with 14.58 percent and Madison trails with 12,592, 10.99 percent.
Of the proposed approximately $8.4 million collective contribution, Louisa would cover approximately $2.6 million; Orange approximately $2.2 million; Greene approximately $1.5 million; Fluvanna approximately $1.2 million and Madison approximately $926,000.
However, that was calculated using approximately $2.1 million in fund balance. Authority members decided that was too much.
CVRJ Finance Director Teresa Miller said using the fund balance to balance the budget isn’t something that can happen every year.
“We know we can’t keep using fund balance all the time,” she said. “Eventually, the fund balance will get low.”
Authority chairman and Louisa County Supervisor Troy Wade said the localities could face a large increase in future years if contributions continue to be kept flat.
“We have to start spreading the pain out or get hit in one year,” he said.
Miller said if the authority uses $2.1 million of fund balance in the fiscal year 2021 budget, it will have to start looking at an increase next year.
Madison County Administrator Jack Hobbs said originally, the idea was to use the fund balance to smooth out increases over time to help the local governments.
“We know it’s going to go up because we’re spending money and not replacing it,” Wade said. “I’m in favor of increasing a little every year [and] hopefully eventually it’s to where localities are paying for it with organic growth. I’m of the opinion we start spreading out the burden now, even if it’s just a little bit. If we keep spending $2 million a year, we’ll run out in three and that’s pushing it.”
Miller said the draft budget was also created using fund balance to cover any medical reserve true-ups needed at the end of the fiscal year. She said $800,000 was placed in the budget for medical costs to jurisdictions. That money is divided up for each county’s medical costs according to the same funding formula that is used to split up the collective contribution. In years past, once a county has inmate medical bills exceeded that county’s medical reserve, the jail issues that county a bill. Because the jail’s inmate medical insurance only negotiates rates and doesn’t cover medical costs like a citizen’s regular private insurance, medical bills can easily cost tens of thousands, if not hundreds of thousands. The idea in the draft budget would be to cover any medical costs outside of the county’s medical reserve using fund balance. Approximately $90,000 in fund balance is also used to cover the true up for the reserve account which is 16 percent of the total jail budget.
Miller said in the last four years, no locality has paid over $200,000 in medical costs.
Fluvanna County Administrator and jail authority at-large member Eric Dahl questioned the use of fund balance to pay for medical costs.
“Does Fluvanna really want to pay for Madison’s prisoners,” he asked. “There’s a reverse to that.”
Wade said the fund balance was largely comprised of funds received for housing federal inmates.
“It makes sense to me if we’re going to use fund balance, use it equitable across the board [with] a little increase to localities,” he said.
Dahl said federal funds should be proportional to the county’s liability and be tied to the funding formula based on each locality’s inmate population.
Madison County Sheriff and jail authority member Erik Weaver agreed with increasing the total contribution from the localities and using fund balance to cover medical costs.
“I’d rather start paying early than get hit with a big increase,” he said. “Use the federal money to offset medical.”
Hobbs suggested creating some sort of stabilization fund to avoid counties being hit with large medical bills.
“One-hundred thousand dollars is a lot for a small county,” he said.
Fluvanna County Supervisor and jail authority member Donald Weaver disagreed.
“Is that my fault,” he asked.
Wade asked if the fund balance used for medical costs should be tied to how much a county spends on the operation costs.
“Does it not matter how much a county spends of the operating costs,” he asked. “You’re entitled to whatever you spend?”
Miller said if the line item were proportionally increased, the funds could be divided out by allocation percentages. She said the medical could be increased from $800,000 to $1.2 million using fund balance to cover the difference.
Wade suggested leaving the medical reserve as is until one county gets a substantial bill. Then it could be divided up equitably and figured out then.
Louisa County Sheriff and jail authority member Ashland Fortune suggested the localities develop a policy on how to handle fund balance to avoid confrontation.
Dahl made a motion that the total locality contribution be increased by $400,000 and the medical reserve be left as is. Weaver seconded the motion which was approved by all authority members present, minus Wade who, as chairman, doesn’t vote.
As of Monday, Miller was recalculating the total contributions for each county distributing the $400,000 increase according to the allocation formula. The authority will continue work on the draft budget next month.