There is no custom code to display.

There is no custom code to display.

Finance committee gets updates on insurance premiums, cash balance

Monday, September 4, 2023–9:00 p.m.

-David Crowder, WRGA News-

The City of Rome has seen an increase in insurance claims and that could mean an increase in premiums for employees.

City of Rome Finance Director Toni Rhinehart recently told the finance committee that revenues are pretty much where they were budgeted. However, expenses, such as claims are up. At this time last year, claims were at $4 million. So far this year, claims are at $4.8 million.

“We are really high in claims, and what is alarming, we are not at our highest point yet,” she said. “A lot of claims are filed at the end of the year when people meet their deductible and such. We expect that number to continue to be up and we are really low in cash at this point. So, we are definitely looking at an increase in premiums for employees, but we haven’t had one in almost four years.”

Rising premiums are something that local governments and school systems across Georgia are grappling with. The Rome City School System’s FY24 budget includes an increase in expenditures, due mostly to an increase in health insurance costs. Although there is money from the state to cover the increase for teachers, the school system’s budget anticipates an increase of $2,920,491 in health insurance costs, which is an increase of 54.9 percent.

Rhinhart hopes the increase for the city is not as much as the school system saw. She and City of Rome Human Resources Director Kristy Shepard will have to sit down and look at the numbers.

Toni Rhinehart

“It’s probably going to be seen as a significant increase because we haven’t had any,” she said. “We are probably going to have to do more than just a very slight one.”

Earlier this year, Atrium Health Floyd was chosen as the new provider for an employee wellness clinic for city and county employees, but Rhinehart told the committee that it’s too early to tell the financial impact of the clinic.

“Some things, we are still looking at because you really can’t tell until you have a year or two worth of history what the impact is going to be,” she said. “The changes that we made with the clinic, with pharmaceutical, we think are positive and helpful, but pharmacy has gone up as well. We have some medications that are very expensive.”

City of Rome cash balance explained during finance committee meeting

During the final public hearing prior to the setting of the City of Rome’s millage rate, there was discussion regarding a healthy cash balance and why that could not go toward lowering the tax rate further.

During a recent finance committee meeting, Rome Finance Director Toni Rhinehart gave a presentation, explaining what happens to that general fund and capital balance during the course of the year.

The city began the year with a cash fund balance of $24.2 million. That total currently stands at $3.4 million.

“We do start every year with a very healthy fund balance or a healthy cash balance,” Rhinehart said. “However, we have a lot of expenses between January and the current time that take most all of that. We are not at our lowest yet. September will be our lowest cash balance.”

In September of last year, the balance was at $2.6 million and Rhinehart anticipates being lower than that this year. However, money will start coming in during the months of September and October from tax collections, and the cash balance will start going back up.

“What we report at our end of year, which is December 31 because we are on a calendar year, is our highest point,” Rhinehart added. “Where we are now and in the next month is our lowest. It looks like we have tremendous cash at the end of the year, but it takes that to carry us through until we start collecting taxes again.”

According to Rhinhart, if the cash balance got any lower, the city would likely have to borrow money, which it used to do through tax anticipation notes or TANS. Rome City Manager Sammy Rich said that TANS are the equivalent of someone getting a payday loan.

“We used to do TANs every single year,” Rich said. “So, we finally get to the point financially where we have enough resources that we don’t have to go get, what again is kind of the equivalent of a payday loan, with short-term borrowing.”

“By having this money, I feel like we are saving money,” Rhinehart added. “We’re not borrowing money and paying the interest. Regardless of whether we borrow or the school board borrows, it still costs the taxpayer. So, that’s why we have worked really hard to be at this point.”

According to Rich, not a lot of communities have independent school systems that are funded the way the City of Rome funds the Rome City Schools. That makes things a bit different for operations and how the city has to pay the bills.