07/08/13 — Commission flips on shifting funds

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Commission flips on shifting funds

By Steve Herring
Published in News on July 8, 2013 1:46 PM

Cost shifting between line items in the county budget, a practice scrapped by Wayne County commissioners in April, has been resurrected. And in bringing it back, commissioners made it clear they want to be able to shift costs between county departments, too.

In April, Commissioner Joe Daughtery called cost shifting "voodoo economics" that defeated the purpose of having a budget. Commissioner Ray Mayo questioned how government could do something he said is unacceptable in the private sector. The board voted 5-2 at the time to stop the practice and to require that additional money for budget amendments come from fund balances and not from money shifted from other line items.

Last week, following a recommendation by county Finance Director Pam Holt, commissioners unanimously approved a reversal of that policy.

Commissioner John Bell, who voted against the April change, made the motion to approve Mrs. Holt's recommendations.

The topic was not on the meeting agenda, but was added during the briefing held prior to the regular session.

Under the new policy, budget amendments may move money between departments with the approval of the Board of Commissioners.

Also requiring board approval are budget amendments greater than $5,000 that might increase or decrease line items and those that increase both revenues and expenditures.

The county manager, finance director and department head are allowed to approve budget amendments of $5,000 or less. Those amendments would be listed in the commissioners' agenda packets, but would not require board action.

Any budget amendment requiring a fund balance appropriation has to be approved by commissioners, County Manager Lee Smith said.

Smith said he has never had the authority to make such a change.

"We changed the policy on this board a few months ago until we finished with next year's (2013-14) budget," Mayo said. "I don't want to see anything taken out of our fund balance that is not necessary. That is my point. If we have got to take out of the fund balance then, am I correct, it does drive our budget up when we do that."

That is correct, Mrs. Holt said.

Mayo wanted to know how the recommendation differed from what the board had done in the past.

Previously there was no $5,000 cap, but money could be moved within line items, she said.

Basically, it is the same as in the past, Mayo said.

Smith said that was correct.

Mayo also wanted to know if commissioners had ever shifted funds from one department to another. They have done so in a limited way, Mrs. Holt said.

Mayo said the current wording of the recommendation did not "leave the door open" for shifting between departments even though it might be necessary.

Mrs. Holt said commissioners could add wording to her recommendation to allow cost shifting between departments, which was not included in her original proposal. She also told Mayo those funds could be shown in the quarterly financial reports commissioners receive.

"We can make the language so that it is not possible to move between departments or we can open it up and let it be possible to move between departments," she said. "That is the decision of the board."

County Attorney Borden Parker suggested adding the phrase, "Budget amendments may move funds from one department to another department only with the approval of the board of commissioners."

Mayo said that was what he was suggesting. He also sought reassurance that the finance department could provide actual figures if funds are shifted between departments.

"I am not for this if you cannot show us at the end of the year next year when we look at our new budget. I'd like to be able to look at each department and see what was actually spent in that department," Mayo said.

That can be done at any time, Mrs. Holt said.

Mayo then offered an amendment to allow the shift from one department to another, but only with board approval.