Members of the Financial Management Committee discussed a county policy on providing funds to outside agencies and deferred action on a resolution that would downsize the county’s Planning Commission.

Committee Chairman Ray Lyons informed the committee he had placed the county’s outside agency policy on the agenda following a request by fellow Commissioner Mike Hill. The county’s current policy requires that non-profit outside agencies seeking funds to provide the county with a copy of their most recent audit report in order to receive the funds.

During the county’s 2016-17 budget cycle, the County Commission approved allocating $12,000 to The Shepherd’s Inn, which is the county’s only shelter providing a safe place for women and children victims of domestic violence. The Shepherd’s Inn has yet to receive those approved funds due to the fact they have not provided the county with an audit.

Hill, who serves on the Board of Directors for The Shepherd’s Inn said the shelter has not had funds available to pay for an audit, but the agency has been obtaining estimates to see what such an audit would cost.

“The best quote they could find was $7,000,” Hill said, adding the county only allocated $12,000 to the agency, and the cost of an audit would eat up more than half of those funds.

The policy requiring an audit was adopted by the County around a year-and-a-half ago, Ray said, adding it was implemented to bring structure to the outside agency funding process and to allow the county to ensure allocated funds were being properly managed.

However, Lyons also praised the work of The Shepherd’s Inn and acknowledged the high cost to the agency for an audit.

“It’s almost ridiculous to receive $12,000 and have to pay out $7,000,” Lyons said.

Hill, who is not a member of the Financial Management Committee, questioned if the county could amend the policy to set parameters that allocations under a certain amount do not require an audit, or possibly only requiring an audit from agencies whose annual budgets exceeded a set amount.

Commissioner Charles VonCannon, a member of the committee, said state law requires all non-profits to submit an annual audit to the state so those agencies should have an audit to provide to the county.

Committee members asked Carter County Attorney Josh for his opinion on the issue.

“State law does provide an exception to the audit requirement,” Hardin said. “State law does not absolutely require an audit.”

According to Hardin, the state allows non-profits to submit a copy of their financial statements, typically the agency’s tax forms, along with a letter from the Chief Financial Officer in lieu of a formal audit.

“At the end of the end of the day, these are donations, and we can put whatever strings we want on them,” Hardin said.

Carter County Finance Director Christa Byrd told the committee members the county’s policy is more strict than what is required under state law.

Hill read members of the committee the list of other organizations which contribute to The Shepherd’s Inn and only require the shelter to submit a copy of their most recent year’s tax forms along with a letter from the Director or Board. Among the agencies listed by Hill were the East Tennessee Foundation, several local and national businesses, Speedway Children’s Charities, and even the federal government’s Department of Housing and Urban Development (HUD).

“I don’t think we’re using common sense with this,” Commissioner Bobbie Gouge-Dietz said. “If the state is satisfied, why aren’t we?”

Carter County Mayor Leon Humphrey said he felt the county should maintain the requirement for an audit to ensure public funds are being properly spent and managed.

“There are a lot of governments that have ceased funding outside agencies,” Humphrey said.

Humphrey also questioned the $7,000 estimated cost for an audit, saying he felt The Shepherd’s Inn should be able to obtain an audit for a lower cost.

“Even if it is $7,000, that is still $5,000 to pay that mortgage,” Humphrey said.

Humphrey made a motion to leave the county’s policy on allocations to outside agencies as it is. The motion was seconded by VonCannon and passed on a split vote of 4-3. Those voting in favor of the policy remaining unchanged were Humphrey, VonCannon, Lyons, and Road Superintendent Roger Colbaugh. Those opposing the motion were Gouge-Dietz, Commissioner Danny Ward, and Director of Carter County Schools Dr. Kevin Ward.

Following the debate on policy, Lyons moved to the next order of business, consideration of a resolution to reduce the size of the Carter County Planning Commission from 12 members to 9 or possibly 8.

“The Mayor asked me to put this Planning Commission discussion on the agenda, and that’s why it’s here,” Lyons said.

Humphrey explained he wanted to downsize the Planning Commission as a cost-saving measure as well as to equalize representation across the county on that board. Currently, according to Humphrey, three of the county’s eight districts have two representatives on the Planning Commission while the remaining districts only have one representative.

“Basically, this is a cost savings,” Humphrey said, adding the county would save $1,800 a year in pay for the Planning Commission members.

Commissioner Danny Ward objected to the consideration of the resolution, saying the Commission has already addressed, and voted down, the idea of downsizing the Planning Commission multiple times.

“We’ve beat this thing to death,” Danny Ward said.

Humphrey said the resolution was drafted following a request by Commissioner Ronnie Trivett and had not been voted down and had only been presented to one Committee.

“It has been brought up several times over the years in many committee meetings and voted down,” said Commissioner Sonja Culler, who is not a member of the Financial Management Committee but was in attendance at Wednesday’s meeting.

The subject of reducing the Planning Commission size was most recently brought up during the March meeting of the Nominating Committee when Planning Director Chris Schuettler asked that committee to reappoint two Planning Commission members whose terms were set to expire. During that meeting of the Nominating Committee, Humphrey suggested the group hold off on those reappointments until the Commission could consider the resolution to downsize. The appointments failed to garner enough votes in the committee to pass, but Committee Chairman Al Meehan brought the matter to the full Commission, which approved the reappointments despite a plea from Humphrey.

The topic of downsizing the Planning Commission has been broached by Humphrey since 2014 when he took the proposal to the Nominating Committee. In September 2014, the idea of downsizing sparked a heated debate during that meeting between members of the committee, Humphrey, and Schuettler.

The Planning Commission was created by a Private Act in the state legislature in 1972 which set guidelines for the number of members and who could serve on the board. During the September 2014 meeting, Schuettler said he received a legal opinion from the County Technical Assistance Service that in order to reduce the size of the Planning Commission the county would have to petition the state to amend the Private Act that created it.

The committee continued the debate in October 2014, but ultimately decided to leave the Planning Commission at 12 members and approved appointments to those positions.

During the meeting on Wednesday, Danny Ward noted Schuettler was not in attendance at the meeting and asked Humphrey if Schuettler had been informed the resolution to downsize the Planning Commission was on the agenda. Humphrey replied it had been announced during last month’s meeting of the full County Commission that the resolution was being brought before the Financial Management Committee. Upon further questions from Danny Ward, Humphrey said he had not personally contacted Schuettler and notified him the matter would be up for debate.

Danny Ward made a motion to postpone action on the resolution until the group’s meeting in May to allow Schuettler to attend and offer his thoughts on the resolution. Dr. Kevin Ward seconded the motion.

Lyons pointed out he serves on the Planning Commission, and the idea of downsizing had not been presented to that group. He asked Danny Ward to amend his motion to include postponing discussion until after the Planning Commission had considered the resolution. Danny Ward accepted the amendment.

The motion passed on a split vote of 4-3 with Danny Ward, Gouge-Dietz, Dr. Kevin Ward, and Lyons voting in favor. Colbaugh, Humphrey, and VonCannon voted against postponing the discussion.