A County's Fiscal Reality

At the September 30th Monroe County Council meeting, former Councilor Geoff McKim offered a candid reminder about the challenge facing our community: Monroe County’s projected $4.4 million budget deficit is not being driven by office supplies, travel, or one-time capital expenses. It is overwhelmingly tied to personnel costs — the number of employees, salary adjustments, and the rising price of benefits like health insurance.  The Chamber has repeatedly spoken about the need to rein in the number of FTE(s) in the city and county.

Why Personnel Costs Matter
Personnel costs are by far the largest part of county government spending. When the budget is out of balance, trimming small items such as supply accounts or travel lines is not nearly sufficient and not the best use of time. To restore fiscal health, the conversation must turn to:

• How many positions are funded by the General Fund.
• How large the annual cost-of-living adjustments (COLAs) are.
• How fast health insurance costs are escalating.

McKim’s testimony made it clear: “There is no path to fiscal balance that doesn’t involve addressing personnel costs.”

The County Council’s Challenge
This is an incredibly difficult process. Council members hold the purse strings, but they do not have direct administrative control over how department heads run their offices. They cannot simply order a department to restructure its organization chart, consolidate functions, or streamline staff. They can set budgets, but the day-to-day changes that create efficiency must be driven by department leaders themselves.

Councilmember Kate Wiltz emphasized that approving a hiring freeze or budget adjustment is only the first step. Implementation is just as important. Since departments are self-contained, the Council’s best tool is to require trade-offs — for example, if a department wants to add a new role, it may need to eliminate another position to keep staffing levels in balance. This approach forces departments to think strategically about their FTE flow charts, maximizing the utility of each role rather than simply expanding.

Local Government’s Short Runway
The challenge is compounded by the broader framework in which counties operate. For better or worse, local government is a creature of the state. Monroe County must work within mandates set by the Indiana General Assembly, even when those mandates restrict flexibility. Senate Bill 1 (SB 1), for example, reshaped property tax and local income tax structures in ways that limit local revenues. It gives counties only a short runway to adapt, while cost pressures continue to grow.

This makes the work of local officials even more critical. The Chamber believes the best government is run by leaders who live in the community and understand its needs firsthand — not by part-time legislators who rarely see the consequences of their policies on local budgets. We have local elections for a reason.  County councils and commissioners are best positioned to balance fiscal responsibility with community priorities.

The Chamber’s Own Experience
The Greater Bloomington Chamber of Commerce faced a similar challenge several years ago. Our organization was not immune to financial pressure. We made the difficult decision to reduce the number of full-time employees (FTEs) while at the same time raising salaries for the remaining staff. The result was a leaner, more efficient Chamber that stayed true to its mission and came out stronger.
It was not easy, but it worked. And it showed that sometimes the right path forward is not across-the-board cuts, but fewer positions with stronger pay, resulting in higher productivity and fiscal sustainability.

Moving Forward
The Chamber respects the hard work of county employees and the elected officials who must make these decisions. But as advocates for the business community, we stress the importance of fiscal discipline. Unchecked deficits today could lead to higher taxes tomorrow, directly impacting local employers and residents alike.
As the County Council continues budget deliberations, we encourage them to pursue sustainable, structural solutions to personnel costs. It may require tough choices — but, as our own experience proves, those choices can put an organization back on a stable footing, better in the long run. 

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