County budget delay violates state law

Published 8:56 am Wednesday, July 22, 2015

County Budget Graphic
Carter County will soon be in violation of state law regarding a time frame for when the county’s annual budget must be approved by the County Commission.
On Monday, members of the Commission heard the opinion of Carter County Attorney Josh Hardin regarding the county’s position after a public hearing on the budget had to be canceled earlier this month, pushing the budget approval into the month of August.
“I think we already are in violation of the statute, or a portion of it,” Hardin said. “We’re past the point of being in compliance anyway.
The statute Hardin referred to is the Financial Management Act of 1981, which is the state financial management law that Carter County operates under. One of the provisions of what is commonly referred to as the “ ’81 Act” is that the county must pass its annual budget during or before the month of July.
This year, the Carter County Commission will not meet that deadline.
The delay in county’s budget process is the result of a clerical error that inadvertently omitted one of the county’s bond payments from the debt service budget.
During a county budget committee meeting held on July 13 just prior to the schedule public hearing on the budget Carter County Finance Director Ingrid Deloach told members of the committee about the error.
To correct the mistake, Deloach told members of the committee they would need to approve a correction to the budget that would allow the county to take that funding from the debt service fund balance, which would not require a tax increase.
Deloach explained the payment was not any new debt incurred but an obligation which the county already had. The payment for the bond has to be made, she said.
After the explanation by Deloach, a motion to approve the correction failed on a vote of 4-3 with committee members Culler, Ross Garland, Buford Peters and L.C. Tester voting in favor and members Nancy Brown, Robert Carroll and Ronnie Trivett opposing the correction. Committee member John Lewis was absent from the meeting.
After the vote, Deloach told the committee that the public hearing would have to be cancelled because the debt service portion of the budget was not complete without the correction. Under the terms of the 81 Act, a county governing body can alter any portion of the budget after the public hearing with the exception of debt service and education funding.
The meeting adjourned that night without the public hearing being held.
During Monday’s meeting of the full Commission, several commissioners spoke about the budget process and how the delay has affected county departments.
Commissioner Buford Peters asked to have Carter County Director of Schools Kevin Ward address the group on how the delay is affecting the school system as it prepares for the start of the new school year in less than a month.
Carter County Mayor Leon Humphrey, who serves as chairman of the Commission, asked why Peters wanted Ward to speak since discussing the problems would not speed the budget process along.
“This unnecessary delay has caused undue hardships for the county,” Peters said. “This body needs to know that actions causes consequences.”
Humphrey agreed to allow Ward to speak and the Director of Schools said the delay on the budget would adversely affect the school system’s ability to prepare for the start of the new year.
“By delaying the budget we are not going to be able to purchase the text books we need to purchase,” Ward said, adding that other projects such as maintenance work could also be delayed due to purchasing being restricted.
Commissioner Sonja Culler, who serves as chairwoman of the budget committee, said even though the commission is in violation of the law the group should continue to work together toward getting the budget passed.
“This is an unfortunate situation but the past is the past,” she said. “Let’s move forward.”

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