Report indicates effective management during recessions; expenses will continue to increase

The Clark County Auditor’s Office this week released an Overtime Performance Audit available on the county’s website at https://www.clark.wa.gov/auditor/audit-reports.

Long-term trends and reported drivers indicate overtime expenses will continue to increase
Several county departments are experiencing conditions that drive an increase in overtime expense. While the largest overtime expenses were in the Sheriff’s Office and Public Works, the average annual growth rate of overtime expenses for all other departments grew at a greater percentage from 2011-17. Departments reported using overtime to expand service capacity during high demand, complete special projects, cover limitations of personnel availability, and to deploy staff during emergencies.

Overtime expenses increase during periods of economic growth and are reduced during economic downturns for all departments except the Sheriff’s Office Patrol function. Their use of overtime remained consistent during all economic conditions. Previous recessionary pressures seen in the last economic downturn may not be experienced post pandemic. The average annual growth rate may return to pre-pandemic growth trends.  

More detailed monitoring needed to understand costs and benefits of overtime
The county’s approach to monitoring overtime is limited in detail and no specific threshold of expenditures has been established that would require additional monitoring. Expanding elements of analysis such as evaluating total payroll cost and consistent overtime usage trends allows for greater understanding of the effects on county services.

County’s approach to budgeting overtime expenses produces large variances
Clark County’s baseline budgeting approach for its largest overtime user department doesn’t reflect changes in actual expenses. Large variances between the initial adopted overtime budget and actual anticipated expenses create risks of too much demand on contingency funding and abrupt service disruptions. Budget practices should consider other industry and/or benchmark overtime expense trends. Better metrics can provide insights on expenditure trends and if similar entities are also experiencing them. 

The report provides recommendations to improve monitoring and management of overtime expenditures. They include establishing thresholds that would trigger additional analysis of overtime expenses and reviews of staffing levels. Metrics are identified that the Budget Office should monitor and departments that use large amounts of overtime should submit detailed interim reports. More frequent updates to historical data used in the baseline budget process could also reduce some risks.

“Implementation of our recommendations will improve decisions regarding the use of overtime,” said Auditor Greg Kimsey. “An understanding of why overtime has occurred should be used in determining the most effective and efficient use of staff and financial resources.”

CONTACT:
Greg Kimsey, County Auditor
564.397.2241, greg.kimsey@clark.wa.gov