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Adequacy of County's Surplus Questioned
2006 sales tax shortfall expected to be between $2.5 and $2.8 Million
by Margaret Sternberg
Most of the September 25, 2006 meeting of the Putnam County Legislature's Audit & Administration Committee was focused on ascertaining whether the approximately $4 million County surplus that remains after almost $3 million is used toward the 2007 budget is sufficient.
Legislator Sam Oliverio said he was concerned that in the event of a major catastrophe a $4 million surplus for a $130 million budget would be inadequate, but Commissioner of Finance William Carlin said that the surplus would grow based upon "whatever we roll out next year." Carlin added that he expected there to be a $4-$5 million balance from this year, which would be added to the $4 million.
Oliverio also noted the growing sales tax revenue shortfall, saying that the bottom line was that "last year's fund balance was inadequate; this year's will be even less adequate..."
Legislator Dan Birmingham asked Carlin whether he was more concerned over the state of the impending fund balance than when the County had a fund balance of $15 million. Carlin said he was, but that needed to be balanced with the fact that the County had then been "blasted" for having had too much of a fund balance and that administrators had criticized the County for "holding taxpayer's money without spending it." Carlin said he did not recommend using less of the fund balance in 2007, adding that "4 million is a good number because we're going to start swinging the pendulum the other way."
Carlin said that the County expected to "wean itself off the surplus entirely for 2008," to which Legislator Tony Hay responded, "We have no choice."
Dominick Consolo, the auditor from Bennett Kielson, concluded that he was comfortable with the December 31, 2005 numbers and as comfortable with the numbers as possible, prior to seeing the results of operations for 2006.
Legislator Birmingham later said that the County's "Commissioner of Finance had assured me, on the record, that the surplus is fine, and I will hold him to it next year."
In other business, the Committee reviewed the monthly Sales Tax, Transfer/Revenue, Contingency/Sub-Contingency and OTB reports, commenting on the Sales Tax report that the sales tax collected to date is slightly more than $19 million below the $47 million projected by the 2006 budget. Legislator Birmingham noted that would mean that approximately $4.7 million would need to be collected for the next four months. The maximum tax collected this year was during May, when $4.6 million was collected. Legislator Hay said the shortfall could be expected to be $2.5 - $2.8 million.
The Committee also pre-filed a number of resolutions and approved several fund transfers.
A resolution was approved authorizing a transfer of funds for the chlorine tank for the Red Mills Water District; there is no fiscal impact. Also approved and with no fiscal impact was a transfer of funds to fund an overtime line to pay a CSEA employee for compensatory time. Funds were transferred to cover exam monitors for the police officer/deputy sheriff/village constable exam.
A fund transfer from East of Hudson funds with no fiscal impact was approved to finance the Septic Repair program. A fund transfer was approved to properly allocate funds between machine maintenance and sub-contractors. This request was one of several that had no backup material provided for the Legislators to review and occasioned a request by Legislator Birmingham for the documentation and that, going forward, no requests be presented without backup documentation.
Funds were approved to be transferred for reclassification of "repair" as "asset improvement." Funds were also transferred to cover overtime/aircraft inspection/purchasing equipment. Legislator Birmingham requested the Sheriff's Department begin issuing a quarterly report to the Protective Services Committee on all use of aircraft.
Also approved and all with no fiscal impact were a transfer related to a Crime Victims Board Grant; to cover the cost of analyzer software for nursing home care; for funds needed for Temporary Assistance for Needy Families employment and training and the purchase of various, related supplies; for the hiring of Immunization Temporary personnel and to cover repairs needed to the air conditioning system at the Bureau of Emergency Services.
The next meeting of the Audit Committee will be Monday, October 30, at 7pm.
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