Forsyth County’s chief financial officer identified government funds he expects to be in the red by year’s end in a mid-year financial report Tuesday.
“Things aren’t looking good,” Bill Thomas told county commissioners at the afternoon work session.
Thomas said problems in the county’s general, internal service and capital projects funds are “chronic.” He projects it could take a total of up to $30 million to fix.
Commissioners could address what Thomas called the “most immediate” of these problems in an Aug. 25 work session.
To help fill a projected $5.7 million gap in the general fund, commissioners could use dollars already in the 2009 budget, but which were intended for capital projects and replacing vehicles.
A negative cash balance in the capital projects fund is a “long-term” problem, he said.
“What really happened was we overstated our fund balance by $10 million at the end of last year,” said Thomas, who could not explain why. “That can’t happen again.”
Thomas, who has been with the county for less than two years, added that an ailing water and sewer fund was “probably news” to commissioners when presented last year.
“You’d think [the news of these negative funds] would have come up in the past,” he said. “Those are the kind of things I expect auditors to tell us.”
The water and sewer fund, which functions solely on user fees, saw an operating loss of $10.3 million in 2008.
Thomas said the county’s recent rate increase and the state’s lifting of drought restrictions helped offset this year’s losses to the fund, which stand at $1.9 million.
The county’s internal service funds also face a sizable loss. Thomas projected eight of the 12 funds will be in the hole by year’s end. He said it will take $16.9 million to “zero these out.”
Depleted surpluses in funds like employee health care and pension had the biggest impact.
Thomas said in past years the county used these surpluses to “minimize costs to the general fund and other funds.” The surpluses have since been exhausted.
Long-term solutions for negative internal service funds could come through lowering the county’s level of government services, Thomas said.
“Service levels need to be addressed,” he said. “Something’s got to give.”
Commissioner Jim Harrell reacted to Tuesday’s report.
“We were in a rock ‘n’ roll development-type budgetary time for revenue,” Harrell said. “Now we’re pretty close to rock bottom in terms of revenue.
“Normal times are going to be above this [revenue level].”
Current plans to help meet the 2010 budget already include a tax hike.
The board could adopt a 0.668 increase in the millage rate in a meeting today, which could generate about $5.7 million in revenue to help cover a projected $7.6 million shortfall in the preliminary 2010 budget.
E-mail Frank Reddy at frankreddy@forsythnews.com.
“Things aren’t looking good,” Bill Thomas told county commissioners at the afternoon work session.
Thomas said problems in the county’s general, internal service and capital projects funds are “chronic.” He projects it could take a total of up to $30 million to fix.
Commissioners could address what Thomas called the “most immediate” of these problems in an Aug. 25 work session.
To help fill a projected $5.7 million gap in the general fund, commissioners could use dollars already in the 2009 budget, but which were intended for capital projects and replacing vehicles.
A negative cash balance in the capital projects fund is a “long-term” problem, he said.
“What really happened was we overstated our fund balance by $10 million at the end of last year,” said Thomas, who could not explain why. “That can’t happen again.”
Thomas, who has been with the county for less than two years, added that an ailing water and sewer fund was “probably news” to commissioners when presented last year.
“You’d think [the news of these negative funds] would have come up in the past,” he said. “Those are the kind of things I expect auditors to tell us.”
The water and sewer fund, which functions solely on user fees, saw an operating loss of $10.3 million in 2008.
Thomas said the county’s recent rate increase and the state’s lifting of drought restrictions helped offset this year’s losses to the fund, which stand at $1.9 million.
The county’s internal service funds also face a sizable loss. Thomas projected eight of the 12 funds will be in the hole by year’s end. He said it will take $16.9 million to “zero these out.”
Depleted surpluses in funds like employee health care and pension had the biggest impact.
Thomas said in past years the county used these surpluses to “minimize costs to the general fund and other funds.” The surpluses have since been exhausted.
Long-term solutions for negative internal service funds could come through lowering the county’s level of government services, Thomas said.
“Service levels need to be addressed,” he said. “Something’s got to give.”
Commissioner Jim Harrell reacted to Tuesday’s report.
“We were in a rock ‘n’ roll development-type budgetary time for revenue,” Harrell said. “Now we’re pretty close to rock bottom in terms of revenue.
“Normal times are going to be above this [revenue level].”
Current plans to help meet the 2010 budget already include a tax hike.
The board could adopt a 0.668 increase in the millage rate in a meeting today, which could generate about $5.7 million in revenue to help cover a projected $7.6 million shortfall in the preliminary 2010 budget.
E-mail Frank Reddy at frankreddy@forsythnews.com.