Volume 1

FY2013

Residents Guide
IntroductIon Cook County government provides vital services for 5.2 million residents of northeastern Illinois, including the city of Chicago and surrounding suburbs. Public services provided include health care, public safety, property and taxation; economic development, and finance and administration. The 2013 preliminary budget projected a $267.5 million shortfall caused by continued revenue declines including the impact of the commitment to reduce sales tax rates, and expenditure increases such as the impact of negotiated wage increases. To close the preliminary budget gap, the budget recommendation supports important structural changes to the public safety and corporate funds, and maintains the Health System subsidy while preparing Cook County Health and Hospital System (CCHHS) for early implementation of the Affordable Care Act. This budget supports a shift in the service model from emergency care to a more holistic patient care model for CCHHS. One-time budget solutions are limited to less than one percent of the budget. The net impact of the structural actions taken during the 2013 budget have improved the fiscal outlook for years 2013-2016 by a collective $1.04 billion from the forecast included in the final 2012 appropriation bill. In addition to targeting expenditure reductions in the operating budget, the 2013 budget recommendation does not include new capital equipment projects. Remaining 2009 and 2010 bond proceeds will be reprioritized as the County borrowed heavily during those years and we are seeking to minimize the cost of borrowing in future years. Additionally, the Capital Improvement Plan is presented utilizing existing capital bond proceeds. These initiatives are used to limit capital borrowing and maximize the return on investment for taxpayer funds. The entire 2013 budget was developed with an eye towards long-term fiscal planning with regards to both capital and operating funds. The County is seeking to preserve the fund balance that was rebuilt during 2011. Furthermore, in order to protect these crucial reserves, the County is proposing adoption of a Fund Balance policy in concert with a broad range of fiscal policies contained in Appendix E in conjunction with the 2013 budget. Similarly, in addition to reducing sales taxes, the County is proposing a set of Revenue policies; in addition to holding the line on new borrowing and reprioritizing existing taxpayer capital funds, the County is proposing a comprehensive debt management policy. The 2013 Executive Budget Recommendation is the result of a collaborative effort. The Presidents Office worked with the Board of Commissioners, County elected officials, employees, their union representatives, and residents to find innovative solutions and present a balanced budget which invests in projects and programs that will improve services while decreasing costs in the long run.

RESIDENTS GUIDE

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Executive Budget Recommendation

cook county Budget overvIew Cook Countys total FY 2013 budget is $3.32 billion, down from $3.35 billion in FY 2012. In FY 2013, the Countys operating budget will decrease slightly, while the General Fund will see a modest increase, driven primarily by increases to the Health Fund as part of Medicaid expansion, along with a full year impact of negotiated wage increases for expired collective bargaining agreements settled during 2012. Meanwhile, total budgeted full time equivalent (FTE) positions will decrease by 462 or by two percent.
Budget and FTE Count by Fund Fund Corporate Fund FTE Public Safety Fund FTE Health Fund FTE Special Purpose Fund FTE Grants FTE Total FTE Capital Total Budget FY 2011 Actual FY 2012 Appropriation FY 2013 (Est.) 2013/2012 Change 136,191,351 163,018,988 145,178,232 -10.9% 1,481.9 1,569.8 1,532.6 -2.4% 1,194,831,990 1,178,878,129 1,186,335,048 0.6% 14,023.2 13,287.3 13,326.7 0.3% 864,388,360 894,133,047 965,885,479 8.0% 6,638.1 7,057.8 6,667.1 -5.5% 538,815,406 570,440,203 517,286,442 -9.3% 1,117.1 1,079.9 1,046.9 -3.1% 185,029,746 148,928,355 134,433,126 -9.7% 724.6 664.6 624.0 -6.1% 2,919,256,853 2,955,398,722 2,949,118,327 -0.2% 23,984.9 23,659.4 23,197.3 -2.0% 188,739,806 391,689,580 372,020,827 -5.0% $ 3,107,996,659 $ 3,347,088,302 $ 3,321,139,154 -0.8%

RESIDENTS GUIDE

Cook County receives operating revenues from several sources, primarily through Property Taxes, Fees, Home Rule Taxes, Grants, and dedicated Special Purpose Funds revenues. Each of these revenue sources is detailed in the following Revenue Estimates section. Revenues are allocated to the Countys five service areas of general government, health care, public safety, property and taxation, and economic development. Additionally, the government has general operating expenses such as employee benefits and building utility payments, which are categorized as fixed charges. Finally, bond and interest payments and the Countys pension liability are also major operating expenditures. The charts below detail the proposed FY 2013 revenue sources and the proposed allocation of the revenues.

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Where the Dollars Come From

Special Purpose Fund Revenue/Fund Balance 4.0%
Property Taxes (Excluding Uncollected Taxes) 24.2%

Fees 33.2%

Personal Property Replacement Tax (PPRT) 1.4% Other Revenues 1.2% Intergovernmental Revenues 4.6% Grants 4.6%

Home Rule Taxes 26.8%

General Government, Annuity and Benet General Government, Administration Finance & 6.5% Finance & Administration 5.4% Bond and Interest 6.2% 6.4% Economic Development 1.1% Fixed Charges Property & Taxation 11.5% 3.4% Health 33.5% Economic Development 1.0% Property & Taxation 3.0% Public Safety 37.6% Health 38.4% Fixed Charges 13.3%

Where the Dollars Go Where the Dollars Go

RESIDENTS GUIDE

Public Safety 32.7%

FIscal year 2013 general Fund Budget In the preliminary budget, the County projected the general fund shortfall between expected revenues and expenses to be $267.5 million for 2013. Anticipated declines of $251.4 million in 2013 revenues were the primary driver of the projected shortfall. Revenues were projected to decline primarily at the Cook County Health and Hospital System and due to the planned 0.25% roll back of the sales tax, which would lead to an $86 million reduction in taxes. Expenditures were projected to increase by $16.1 million, less than 1% from the prior year, primarily as a result of contractual wage increases.
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Executive Budget Recommendation

The proposed 2013 budget is a balance of expenditure reductions, modest revenue growth, improved collections, and targeted revenue initiatives in order to close the preliminary budget gap. expendIture reductIons Personnel costs continue to be the largest expenditure for the county and comprise 77% of the 2013 budget recommendation. However, we are saving $24.5 million in the budget due to personnel reductions such as vacancy eliminations. Additionally, by aligning health care plans, savings on prescription drug plans, and overall headcount decline, the County will save $9 million on health benefits. Non-personnel reductions include $5.6 million savings from reducing electricity and natural gas usage, results from the City of Chicago-Cook County collaboration efforts, savings in procurement, the termination of under-utilized leased space, and reduction in the size and better utilization of the Countys fleet vehicles. Investments In property and taxatIon Through collaboration and making key investments, the County was able to mail the second installment of the tax bills out on time in 2012 for the first time since 1977 and is in a position to do so again in 2013. We are continuing our commitment to transforming business processes and automating services in the Property and Taxation area. In the Property and Taxation area, the Board of Review will move from a completely paper-based system to electronic case management system. In 2013, the County will also continue to upgrade the Property Tax website to allow for additional online constituent services. Investments In puBlIc saFety The public safety system is 37% of the overall County budget and is comprised of the court system and the Sheriff. FY2013 budget for public safety services is $840M, which is a 2.4% increase over the current years adjusted budget, despite the 8.5% cost of living adjustment for law enforcement personnel, the 6% cost of living adjustments for administrative staff, and the expenditures tied to compliance with the Department of Justice orders court orders at the jail and the Juvenile Temporary Detention Center (JTDC).

RESIDENTS GUIDE

The FY2013 budget recommendation contains initiatives to improve service delivery and/or control costs such as increasing alternatives to detention, consolidation of vehicles and space, use of the Public Defenders Office for more civil conflicts cases and felonies, and expediting screening for deferred prosecution programs (DPP) and specialty courts. The Juvenile Temporary Detention Center population has sustained a decrease in population to support closing part of the center in 2012. Alternatives to incarceration are more cost effective than JTDC and allow those who would otherwise be detained to lead more productive lives, lower recidivism rates and improve public safety in the long run.

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Use of Public Defender expertise rather than hiring outside counsel saves the County money without compromising quality or level of defense services provided. The County expects to save over $700,000 in outside counsel fees in FY2013. Investments In the cook county health and hospItal system Approximately 57% of CCHHS patients have no insurance and limited ability to pay for their health care. CCHHS is seeking approval for an 1115 Medicaid Waiver to expand eligibility to 133% of the Federal Poverty Level (FPL) during 2013, enroll 115,000 of its patients into Medicaid over the course of the year, and begin receiving reimbursement for services. The CCHHS budget increases to $965 million from $894 million, an increase of $71 million. The 1115 Waiver revenue has a net positive impact of $99 million after accounting for associated increased expenditures. Excluding the $98 million investment into the 1115 Waiver, the CCHHS FY 2013 budget declines by $27 million, or approximately three percent. Expenditure reductions include eliminating 365 vacancies for $22 million, reducing supply costs by $25 million, $14 million from reducing funding to account for timing of new hires, reducing $8 million in non-service related accounts such as advertising, travel, and transportation. These decreases are offset by other contractual increases and rising personnel costs. revenue InItIatIves The FY 2013 Budget Recommendation includes targeted new revenues that promote health and wellbeing, cover costs associated with firearms, and incentivize economic activity in Cook County. The budget proposes to increase the cigarette tax by $1 per pack which will increase revenue by $25.6 million for 2013. Taxing gambling machines such as slot machines and video poker is estimated to bring in $1.3 million. A firearm and ammunition tax to fund public health and safety is estimated at $1 million in 2013. To level the playing field and close a tax loophole, the budget proposes a tax on non-titled personal property purchased outside of the County. By setting the proposed rate higher than the Countys sales tax rate, the proposed tax encourages purchases within Cook County. The non-titled use tax is estimated to generate $15 million in 2013. In addition to new revenue sources, updated revenue estimates for 2013 along with increased collections, receiving incentives and rebates, and $3.9 million in one-time revenues, the County will have total general fund revenues of $2,297 million.

RESIDENTS GUIDE

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Executive Budget Recommendation

Closing the Budget Gap

Preliminary Budget Gap $267.5 $99.0 $50.7

Revenues, $1,984,591,961

Medicaid Expansion Expenditure Reductions

Targeted New Revenues

$43.4

Gap, $267,511,526

Improved Health Billing/ Collections and Updated Rates $28.3 Maximizing Reimbursements, Transfers and Collections $23.0 Better Performing Revenues $13.5

Expenditures, $2,252,103,487

Incentive and Rebate Payments $5.7 One Time Revenue Sources Remaining Gap $3.9 $0.0

cook county long-term revenue and expense Forecast Pursuant to Executive Order 2012-01, Cook County prepares a long-term financial forecast to support responsible long-term planning. Over 99% of the FY 2013 budget solutions are structural changes that continue to reduce the deficit in future fiscal years. The significant recurring actions taken to balance the 2013 budget have significantly improved the fiscal outlook in 2013-2016 by a collective $1.04 billion versus the projections included for those years in the final 2012 budget. Despite these efforts, the long-term forecast projects a deficit of $133 million in FY 2014 that grows to $464 million by FY 2017 as shown in the accompanying chart. We expect expense reductions through operational improvements, as well as revenue forecast revisions to address the substantial and expanding structural deficit shown in the accompanying charts. Though the County is required by statute to present a balanced budget annually, the forecast provides a critical tool in evaluating the long-term fiscal challenges the County faces. This forecast examines the general fund only, as special purpose funds are inherently self-balancing. revenues Each revenue source was analyzed individually - historical data (both for previous estimates and for actual revenues) are reviewed. The behavior of each source was modeled using appropriate economic drivers such as GDP growth and industry trends. The resulting revenue-specific models included single and multiple linear regression, exponential growth or decline, one-time events and flat growth where no valid information was available for forecasting.

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We expect overall decline in two of our major revenues - Property Tax and Sales Tax. Property Tax: Net Property Taxes will decline, as bond and interest payments (which have a first claim on Property Taxes prior to operations) are projected to increase from $187 million in FY13 to $299 million in FY17. Bond and interest payments will rise as the impact of substantial borrowing in 2009 and 2010 is fully absorbed, and the County will no longer benefit from the 2011 debt restructuring, which targeted three fiscal years of relief. Accordingly, even absent new capital borrowing to finance capital infrastructure needs, debt service is projected to increase steadily in coming years and property tax revenues available to fund general operations will decline accordingly. Any potential increases in pension payments associated with the under-funded status of the County Pension Fund, which might further reduce net Property Taxes available to the General Fund, are not included. Sales Tax: The 2008 sales tax increase has been partially repealed and will be fully repealed on January 1, 2013, which will start impacting collections in April 2013. Those tax revenues will drop from a peak of $659 million in FY09 to $339 million in FY14, and then begin to grow slowly due to organic growth in economic activity and underlying sales. A major new source of revenue is anticipated in FY 2013 as the CCHHS 1115 Medicaid Waiver application is expected to be granted by the federal government in order to expand Medicaid eligibility to Cook County residents with incomes up to 133% of the federal poverty level. These patients would become eligible for Medicaid solely at CCHHS for calendar year 2013, prior to full implementation of the Affordable Care Act (ACA) in calendar year 2014, which would allow these patients to seek medical care with providers outside of the CCHHS system. It is assumed that competition for newly eligible Medicaid patients will lead to a decline in the number of these patients that remain in the CCHHS system over time. CCHHS is currently pursuing several initiatives to improve service quality and patient satisfaction. Depending on the success of these initiatives, CCHHS may be positioned to compete more effectively once the Affordable Care Act is fully implemented. As a result, the decline in the 1115 Waiver patients projected here may be offset if more patients are retained. There is inherently significant variation with regards to forecasting CCHHS revenues as it relates to the Medicaid expansion and ACA in general. A number of other significant revenue sources continue to decline -- the Cigarette Tax has been bolstered by rate increases, but underlying sales continue to fall. Fuel taxes are similarly continuing their long-term decline, while non-Medicaid patient insurance coverage continues to decline in the Health System. Due to the revenue declines outlined above, overall revenue will trend downward in the near term before leveling off in future fiscal years.

RESIDENTS GUIDE

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Executive Budget Recommendation

expendItures Expenses are divided in two categories. Most expenditures (salaries, supplies, utilities, etc.) are projected using the 2.44% average rate of inflation (CPI-U) over the last 10 years. Employee health care costs are projected to grow at 7.45% - a blended rate of recent health insurance and prescription inflation.

Net Surplus/(Deficit) Projection

Revenues 2,600,000,000 Expenses

2,500,000,000

2,400,000,000

2,300,000,000

($133)

($287)

($400)

($464)

2,200,000,000

2,100,000,000

2,000,000,000

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

FIscal Forecast As the chart depicts, the County anticipates a decline in overall revenue and inflationary growth in expenditures in coming years. Accordingly, the County forecast model projects growing deficits in out years, despite the balanced budget presented in 2013. As referenced earlier, the significant recurring actions taken to balance the 2013 budget have significantly improved the fiscal outlook in 2013-2016 by a collective $1.04 billion versus the projections included for those years in the final 2012 budget. The County anticipates continuing to focus on structural, recurring initiatives to balance future year budgets in order to continue to improve the long-term fiscal outlook of the County.

RESIDENTS GUIDE

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FY2013

Projected Annual Revenues and Expenses, by Source

Property Taxes Bond Restructuring Fees County Treasurer County Clerk Recorder of Deeds Building & Zoning Environmental Control Liquor Licenses Cable TV Franchise Clerk of Circuit Court Sheriff Public Guardian State's Attorney Contract Compliance Adoption (Supportive Services) Public Administrator Court Services fee County Assessor Highway Permits Tax Intercept Medical Examiner Chief Judge Medicaid Expansion* Medicaid DSH CCHHS BIPA Total fee revenue FY08 333,321,462 Actual FY09 FY10 354,279,383 333,613,001
Projected Actual

Dept. Estimate

FY11 287,243,990 $105,121,432 75,066,504 10,868,998 32,410,366 1,943,331 4,078,183 360,000 1,173,477 94,404,734 23,586,101 2,169,139 1,946,503 62,050 50,315 1,095,679 11,090,988 100,296 0 0 0 0 190,347,669 153,062,376 131,250,000 735,066,709

FY12 335,209,200

FY13 355,920,180

FY14 330,573,000

Projection FY15 FY16 286,836,000 239,036,000

FY17 253,245,000

82,744,156 8,877,439 46,308,166 1,502,838 4,311,489 370,000 1,138,736 106,855,369 22,341,472 2,263,388 2,588,575 0 64,834 1,760,248 9,558,426 505,046 0 0 0 6,030,627 279,005,999 127,270,439 703,497,247

79,972,437 10,090,209 34,151,181 1,567,539 3,949,671 390,000 1,088,367 103,158,931 26,046,043 2,055,905 2,241,279 0 47,061 792,987 13,119,269 449,050 0 0 0 0 237,987,712 294,100,749 131,300,000 942,508,390

94,284,334 9,407,629 33,571,773 1,329,972 4,126,084 370,000 1,134,365 104,211,099 25,123,823 2,247,524 2,123,261 0 36,057 952,624 12,890,150 289,735 0 0 0 0 239,626,832 162,750,532 131,250,000 825,725,794

78,000,000 10,477,839 33,884,644 2,476,068 4,306,093 400,000 1,100,000 94,986,610 26,521,500 2,650,875 1,899,000 68,650 21,850 900,000 11,000,000 150,000 400,000 0 0 0 284,490,495 150,807,707 131,250,000 835,791,331

Patient fees (Medicare,Medicaid,Other)

76,000,000 10,315,000 33,364,000 2,750,000 4,374,000 360,000 1,000,000 95,000,000 26,521,500 2,680,000 1,900,000 83,000 25,000 900,000 11,000,000 150,000 562,000 2,000,000 825,000 0 196,964,900 231,105,542 150,800,000 131,250,000 979,929,942

72,048,000 11,473,000 37,251,000 2,750,000 4,575,000 360,000 1,050,000 96,233,000 26,521,500 2,680,000 1,900,000 83,000 25,000 900,000 10,339,000 150,000 562,000 2,000,000 825,000 0 212,753,722 204,948,000 150,800,000 131,250,000 971,477,222

68,626,000 11,867,000 39,020,000 2,750,000 4,777,000 360,000 1,103,000 98,561,000 26,521,500 2,680,000 1,900,000 83,000 25,000 900,000 10,100,000 150,000 562,000 2,000,000 825,000 0 175,960,517 194,330,000 144,135,000 131,250,000 918,486,017

65,538,000 12,260,000 40,776,000 2,750,000 4,978,000 360,000 1,159,000 100,947,000 26,521,500 2,680,000 1,900,000 83,000 25,000 900,000 9,867,000 150,000 562,000 2,000,000 825,000 0 186,518,148 175,999,000 142,800,000 131,250,000 910,848,648

65,538,000 12,654,000 42,896,000 2,750,000 5,179,000 360,000 1,217,000 100,947,000 26,521,500 2,680,000 1,900,000 83,000 25,000 900,000 9,638,000 150,000 562,000 2,000,000 825,000 0 197,709,237 167,311,000 126,785,000 131,250,000 899,880,737

* 1115 waiver in calenday year 2013, expansion of Medicaid eligibility in 2014 and later.

Home Rule Taxes Sales Tax Tax Anticipation Note Gas Tax/Diesel Cigarette Tax Other Tobacco Products Non Retailer Transactions Retail Sale of Motor Vehicles Wheel Tax Alcoholic Beverage Tax Use tax Delinquency/Home Rule Projects Non-Titled Use Tax Gaming Amusement Machine Tax Firearms and Ammunition Tax Parking Lot/Garage Operations Amusement tax Total home rule taxes Intergovernmental Revenues Motor Fuel Tax Grant MFT Circuit Court Funding Retailer's Occupation Tax State Income Tax Corp Fund Operating Transfer Off Track Betting Commission Gaming Chicago TIF distribution State Criminal Alien Assist.(SCAAP) Probation Off, Juvenile CT & JTDC Indirect Costs and MFT Reimb Transfer from Forest Preserve Total Intergovernmental rev Other Revenues Interest Earnings - Transfer Out SaleBond Forfeitures Bail of Real Estate Leases, Rentals, Sales CCHHS Miscellaneous Revenue Parking Total other revenues

386,608,668 122,000,000 95,721,797 162,180,286 0 0 2,810,637 2,070,830 27,093,088 44,858,687 0 0 0 0 38,314,638 21,779,492 903,438,123 34,500,000 0 4,066,399 11,178,664 0 3,119,035 0 0 0 18,714,435 12,698,999 0 84,277,532 2,500,000 19,750 0
-

658,832,464 -121,814,369 89,940,077 136,792,198 0 0 2,005,829 1,878,261 26,717,665 35,611,087 0 0 0 0 36,555,787 20,257,771 886,776,770 43,500,000 0 2,982,731 9,602,339 0 2,820,507 0 0 0 18,091,770 12,123,110 0 89,120,457 18,000,000 183,000 0
-

654,238,552 93,845,117 130,991,187 0 0 2,056,440 1,949,624 24,877,627 35,093,912 0 0 0 0 36,061,999 21,968,677

503,606,017 86,835,706 123,250,026 0 0 2,350,506 2,033,639 25,550,367 39,561,453 7,710,678 0 0 0 35,298,822 22,654,403 848,851,617 44,500,000 0 2,867,781 9,755,822 0 2,683,066 0 19,046,312 2,290,019 16,921,164 18,916,714 0 116,980,878 0 0

457,600,000 87,700,000 114,500,000 9,600,000 600,000 2,600,000 3,540,000 34,800,000 54,000,000 0 0 0 0 36,400,000 32,200,000
833,540,000

362,506,668 87,130,000 133,310,000 8,000,000 7,800,000 2,900,000 4,000,000 39,100,000 59,450,000 0 15,000,000 1,300,000 1,000,000 42,560,000 26,250,000
790,306,668

338,800,000 85,539,000 129,489,000 7,520,000 7,800,000 2,900,000 4,000,000 39,560,000 62,541,000 0 26,250,000 1,750,000 1,250,000 42,560,000 27,383,000
777,342,000

351,000,000 83,949,000 116,540,000 7,068,800 7,800,000 2,900,000 4,000,000 40,026,000 65,794,000 0 37,500,000 2,200,000 1,500,000 42,560,000 28,517,000
791,354,800

362,400,000 82,358,000 104,886,000 6,644,672 7,800,000 2,900,000 4,000,000 40,497,000 65,794,000 0 38,717,949 2,271,453 1,548,718 42,560,000 29,650,000
792,027,792

379,400,000 80,767,000 94,397,000 6,245,992 7,800,000 2,900,000 4,000,000 40,974,000 65,794,000 0 40,534,188 2,378,006 1,621,368 42,560,000 30,784,000

1,001,083,135

800,155,553

44,500,000 0 2,834,645 9,026,975 0 2,079,312 0 0 0 16,912,205 13,615,472 0 88,968,609 10,000,000 1,838,392 0

-

44,500,000 30,000,000 3,000,000 11,000,000 0 2,300,000 7,000,000 4,300,000 230,000 16,579,500 22,389,300 0 141,298,800 0 0

44,500,000 30,000,000 3,200,000 12,400,000 0 2,550,000 8,000,000 1,428,000 1,250,000 17,196,300 16,389,300 0 136,913,600 0 0 7,247,997 1,994,042 4,944,563 20,141,767 34,328,369

44,500,000 30,000,000 3,400,000 12,152,000 0 2,314,000 8,000,000 0 1,250,000 17,196,000 16,389,300 0 135,201,300 0 0 7,247,997 1,994,042 4,944,563 6,835,003 21,021,605

44,500,000 0 3,600,000 12,588,000 0 2,314,000 8,000,000 0 1,250,000 17,196,000 16,389,300 0 105,837,300 0 0 7,247,997 2,994,042 4,944,563 6,835,003 22,021,605

44,500,000 0 3,800,000 12,997,000 0 2,314,000 8,000,000 0 1,250,000 17,196,000 16,389,300 0 106,446,300 0 0 7,247,997 2,994,042 4,944,563 6,835,003 22,021,605

44,500,000 0 4,000,000 13,607,000 0 2,314,000 8,000,000 0 1,250,000 17,196,000 16,389,300 0 107,256,300 0 0 7,247,997 2,994,042 4,944,563 6,835,003 22,021,605

RESIDENTS GUIDE

Misc/Other Reimbursements/Transfers

29,621,312 32,141,062 -28,191,816

2,028,483,610 28,191,816 2,056,675,426 2,023,370,351 33,305,075

24,411,836 42,594,836 -26,127,443

2,289,152,393 26,127,443 2,315,279,836 2,233,738,487 81,541,349

21,506,938 33,345,330

23,985,422 23,985,422 45,000,000

30,043,946 30,043,946

Lawsuit Line of Credit

Allocation of Sales Tax to Special Fund

Revenue Total Adjustments Total Revenue Total Expenses Surplus/(Deficit)

2,282,735,869 2,282,735,869 2,308,636,109 -25,900,240

2,162,250,048 2,162,250,048 2,195,411,701 -33,161,653

2,175,883,277 2,175,883,277 2,175,883,277 0

2,297,398,759 2,297,398,759 2,297,398,759 0

2,235,615,127 2,235,615,127 2,368,618,000 -133,002,873

2,124,535,722 2,124,535,722 2,411,487,355 -286,951,633

2,070,380,345 2,070,380,345 2,470,353,025 -399,972,680

2,082,559,195 2,082,559,195 2,546,934,000 -464,374,805

Includes Sales Tax previously allocated to JTDC for FY08--9. Reflects rate reduction for last 2 months of FY10, last 8 months of FY12 and FY13 Provided for comparison purposes to revenues as shown in Revenue Estimate Sources: FY08-FY11: Budget Citizen's Summary, Q-1 Total General Fund Expenditures. FY12: Preliminary Overview of 6/12. FY14-17: FY13 with 3.2% growth (10 year CPI-U-2.44%/Health-7.45%), adjusted FY15-16 for Health System reductions.

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Executive Budget Recommendation

other Budget hIghlIghts Cook County continues to make significant strides to rein in the costs of government while improving the delivery of services to residents in challenging financial times. This budget is fiscally responsible, makes key investments in the Countys financial future and focuses on long-term solutions that will make County government more effective and efficient. This budget was developed through a commitment to President Preckwinkles four core principles: Fiscal responsibility: Ensure that taxpayer dollars are used effectively. Deliver a balanced 2013 budget, while instituting long-term financial planning and improve county government efficiency to enable repeal of the sales tax increase. Innovative leadership: create a culture of exemplary leadership, professionalism and collaboration in county government, which makes it possible to deliver high quality services to residents. transparency and accountability: improve transparency and accountability of county government, in particular by improving public information about hiring, purchasing and the overall use of taxpayer dollars. Improved services: provide high quality, reliable frontline services to the public in key areas such as criminal justice, healthcare, and economic development. The commitments to these four principles are outlined below. FIscal responsIBIlIty In order to identify ways to reduce costs throughout the County, the Real Estate Division in the Bureau of Economic Development has begun work on a strategic real estate assessment and evaluation of all County owned and leased assets. The assessment will look at the physical condition, location, importance to core mission, occupancy levels, and possible reductions in space usage. This assessment will refocus the capital project request process to foster long-range planning. The Real Estate Division is also expecting more than $1 million in savings in 2013 as a result of consolidation of leases, improved management and excess land sales.

RESIDENTS GUIDE

Cook County has focused on modernizing its financial management and internal processes. During 2012, the Bureau of Finance was able to issue its 2011 Comprehensive Annual Financial Report (CAFR) within six months of the end of the fiscal year for the first time in ten years. The County continues to realize procurement savings through its ongoing strategic sourcing initiative. The Office of the Chief Procurement Officer launched the Cook County Marketplace, an online procurement tool that will create efficiencies by pooling contracts for County-wide use to drive down costs by approximately 10-20% compared to previous contracts. In 2012, the Comptrollers office began offering County vendors the option of being paid through electronic payables and wire transfers. Vendors will be paid more quickly and the County will generate additional revenue through discounts.
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InnovatIve leadershIp The Bureau of Administration has worked to create efficiencies wherever possible, and this year they have consolidated Xerox maintenance contracts which could yield recurring savings up to $280,000 annually. The Department of Environmental Control is working to make Cook County a world-class model of sustainability, cost savings and conservation by embedding a culture of sustainability in all County operations, services and partnerships with suburban communities through the Sustainability Advisory Council. The Council is headed by Christopher Kennedy, former President of Merchandise Mart Properties, Inc. and Anne Pramaggiore, President and CEO of ComEd. In order to improve efficiency in capital projects throughout the County, the Department of Capital Planning will begin using Facility Wizard, a new electronic and web based financial management tool that will assist in the completion of projects efficiently and timely. President Preckwinkle has launched a $200 Million Small Business Financing Initiative to provide small businesses access to the capital necessary to seize new opportunities, serve staffing needs, and satisfy short-term business financing requirements. Through the Owner-Controlled Insurance Program the County will purchase insurance for all contractors doing business with the County. This will relieve them of the expense and allow them to allocate their financial resources to other business needs. transparency & accountaBIlIty The Bureau of Administration is implementing an Automatic Vehicle Location (AVL) initiative utilizing Global Positioning System (GPS) that will support management of the Departments fleet of heavy vehicles, light trucks, service vehicles, and specialty equipment. AVL will improve emergency responses, track snow removal and roadway maintenance activities, provide efficient routing capabilities, provide reporting functionality, reduce fuel consumption, and improve workflow efficiencies. The County is currently undergoing the RFP process for implementation of a Countywide Time and Attendance System. This new system will serve several purposes including eliminating manual timekeeping processes in some areas thus improving efficiency and reducing error, increasing compliance with legal and union requirements, providing improved controls over employee time off, increasing flexibility in methods for tracking/recording time (i.e. via mobile/web), and providing data/ analytics for management to view and understand trends in absences and pay. As part of the Countys ongoing open data initiative, information regarding hiring, contracts and other County business is regularly posted online for public consumption. Cook County will be putting an absence management program in place during 2013, which will improve compliance with the Countys leave policy, boost productivity and help lower personnel costs.

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Executive Budget Recommendation

The Sheriffs Office implemented a 24-hour Medical Call-In program to improve attendance and reduce overtime. The advanced notice provides better opportunities to adjust staff to meet departmental needs and reduce overtime. Improved servIces Cook County is the recipient of a 2012 award from the National Association of Counties for the Department of Facilities Managements ongoing energy efficiency and cost savings initiatives totaling $2.5 million in savings. In order to better serve small and local businesses that have contracts with Cook County, the Comptrollers office in the Bureau of Finance is currently meeting its goal of processing payments within 7-10 days of receipt. The sooner businesses are paid, the quicker they are able to pay their sub-contractors who, in these difficult economic circumstances, need access to capital in order to meet payroll deadlines and hire new employees. The Office of the Chief Procurement Officer coordinated a joint outreach event with the City of Chicago this year to reach a wider audience of vendors, gain vendor interest in County business, and ultimately increase competition to reduce cost. The Department of Building and Zoning is seeking to implement an electronic online permitting and review system to replace the current paper and memory driven permit process. The new system will provide a controlled, coordinated, transparent and cost efficient system for both employees and clients. Once implemented, residents will be able to track permits online, making the system more accountable and efficient. Building and Zoning is also implementing an electronic revenue system. Customers currently have to travel from all areas of unincorporated Cook County to the downtown office to purchase permits and pay fees. The online system will offer an efficient solution for residents and will increase compliance with County building codes and regulations. perFormance management Closing the preliminary budget gap required data-driven management decisions that minimize service impacts. The Set Targets, Achieve Results (STAR) Performance Management program data provides context for budget trade-offs and helps decision makers better understand how directing tax dollars will affect County services.

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Since its establishment, the STAR Performance Management program has increased visibility into the Countys operations and generated substantial returns through increased revenue, decreased costs and improved services. STAR is a partnership of the Board of Commissioners, County Agencies, employees, and residents. All County offices and agencies report progress toward stated goals, and work together to improve performance. The efforts of each office within the County have been linked to countywide goals in the areas of public safety, healthcare, property and taxation, and economic development. The STAR program provides a forum for county agencies to work jointly to set priorities, identify opportunities, address problems, and measure performance transparently. Through the first three quarters of FY 2012, over 30 performance management review sessions have been held with County departments and

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offices. In those sessions, County leadership has identified and implemented over 175 action items to improve operations and increase collaboration between offices. In total, STAR initiatives have led to over $12M in either increased revenue or decreased costs to taxpayers in FY 2012. Through STAR, the County regularly reports performance data, creating a culture of transparency and accountability. During internal reviews with senior County leadership and the quarterly STAR reports, County agencies demonstrate successes and highlight areas for improvement. Residents and decision makers have access to critical operational data that helps them to hold their government accountable. In addition, performance data provides decision makers valuable information in deciding how best to direct tax dollars. Quality performance data is important to understanding how budget decisions will impact operations and is a critical input to performance based budgeting. Working closely with agency and department heads to establish goals, set targets and regularly collect and review data, the STAR program has led to several notable accomplishments: l The collection of $5.2M in delinquent and deficient home rule taxes in FY 2011 and $1.2M through July of FY 2012 l A reduction in County energy usage by $930,000 in FY 2011 and $285,000 through July of FY 2012 l The mailing of property tax bills on time for the first time in 34 years saving County taxing districts a total of up to $3M per month in borrowing costs l Reducing the time to hire new employees from 115 to 94 days Starting at the end of FY 2012 and continuing into FY 2013, the STAR program will deepen its engagement with agencies to support the use of performance data as a management tool. The effort will include facilitating internal goal-setting discussions within agencies and departments, as well as training and regular monitoring. In addition to efforts to build on and improve the use of performance data within departments, the performance management team seeks to improve on existing processes in place, including: l Improving public access and visibility into STAR performance data l Promoting a data-driven culture within Cook County focused on measurable goals and targets l Increasing internal visibility into overall County performance

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Executive Budget Recommendation

Budget process Cook County prepares an annual budget that provides a spending plan for the next fiscal year. The County produces a balanced budget, as required by the State of Illinois Counties Code, which accounts for the Countys revenue and intended spending. The budgetary basis of accounting is a cash plus encumbrances basis. The budget process begins in early summer. County departments inform the Department of Budget and Management Services (DBMS) of their expected personnel and non-personnel needs for the next year. Concurrent with this process, the Chief Financial Officer and the County Comptroller prepare an estimate of revenues and other resources available for appropriations. President Preckwinkle issued Executive Order 2012-01 mandating that DBMS prepare a preliminary budget earlier this year than in 2011. This year, the County presented its preliminary budget on June 27, 2012. DBMS prepares the preliminary budget based on the requests submitted by the departments and the revenue the County expects will be collected. The Preliminary Budget is required to be filed with the Presidents Office by June 30 of each year. The Preliminary Budget is provided to the Cook County Board of Commissioners and made available for County residents. Pursuant to Executive Order 2012-01, the President holds a preliminary budget hearing to allow residents to express their opinions concerning items within the proposed budget. After receiving input from residents, the President of the County Board and DBMS work with each department to develop a final executive recommendation. The executive budget, as recommended by the President, is submitted to the County Boards Committee on Finance, which in turn holds hearings with each department. Later, at several sites throughout the County, public hearings on the budget are held by the County Board. The County Board considers the budget carefully and may submit amendments to increase or decrease the budget. The County Board approves the final budget, in the form of the Appropriation Ordinance. The Appropriation ordinance is implemented at the start of the fiscal year, which begins on December 1 of each year.

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We Want to heaR fRom you:

What are your ideas for improving County services? What are your ideas for making County government more efficient? How can we improve the budget process for next year? For more InFormatIon and to share your Ideas, vIsIt our weBsIte: http://www.cookcountyil.gov/budget

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CooK County BudGet CaLendaR

may/June Departments submit preliminary revenue and expense estimates to the Department of Budget and Management Services (DBMS). The agencies specifically summarize issues, request specific funding levels, and justify staffing requests. DBMS repares the preliminary budget based on the requests submitted by the departments and the revenue the County expects will be collected. The Preliminary Budget is filed with the Presidents Office by June 30.

June

July

The President holds a public hearing on the Preliminary Budget, allowing the public to provide feedback during the development of the Executive Budget Recommendation.

septemBer Residents and departments provide input during the final development of the County budget. The President and DBMS work to balance department requests with available resources. octoBer The President submits the Executive Budget Recommendation to the Committee on Finance of Cook County.

novemBer The proposed budget is made available for public review at various locations throughout the County. Public hearings are conducted during which the Committee on Finance considers testimony from service providers, program staff, and the general public. After the hearings have been completed and any amendments inserted, the Board of Commissioners approves and adopts the Appropriation Bill, which authorizes funding and staffing levels for each department. decemBer The fiscal year begins. The Appropriation Ordinance is implemented on December 1.

on - goIng Quarterly allotments are implemented and monthly expenditure and revenue reports are reviewed to ensure the resources allocated through the Appropriation Ordinance are managed. In accordance with the STAR Performance Management program, offices report data about how well programs are functioning and services are being provided to ensure high quality services are provided with the resources collected.

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