FONDA - The discussion at a Montgomery County Financial Committee meeting Wednesday focused on the fund balance as officials work to balance drawing from the reserves and storing a healthy amount for the future.
The committee was joined by Board of Supervisors Chairman and Root town Supervisor John Thayer, St. Johnsville town Supervisor Dominick Stagliano, department heads and other members of county government as the goals of the tentative 2013 budget, released Oct. 1, were discussed.
Thayer, Stagliano, and Montgomery County Treasurer Shawn Bowerman took turns speaking, explaining how in the past, the supervisors relied on the fund balance reserves to help balance the budget and keep taxes down. As it stands now, Bowerman's $92 million preliminary budget uses $1.34 million from the reserves, lowering the remaining fund balance to an estimated $4.66 million.
"The goal is to keep the fund balance at that level. Even $4.6 million is low for a [$92] million budget. The lowest the state recommends is no less than 5 percent of the budget, and that $4.6 million is close to that," Bowerman said.
According to a chart made by the county, the unappropriated fund balance has shifted up and down across the last 10 years. In 2002, Montgomery County had only $116,161 left in unappropriated fund balance. This increased the next few years, with $15.7 million in the fund balance as of 2007.
However, complaints came in around that time to use the fund balance.
From 2008 to 2011, the fund balance has steadily decreased as funds were used to balance the budget. The fund balance dropped from 2008's $15.1 million to $9.9 million in 2009, then to $8.6 million in 2010, before hitting $4.6 million in 2011.
The 2012 fund balance is estimated at $6 million, but an exact number will not be known until 2013.
"Because of the overuse of fund balance the last five years, you'll see the chart go in drastically the wrong direction," Bowerman said. "You can see a direct correlation to balance the past budgets."
"We don't learn from our mistakes," Bowerman said later. "It's a 10-year vicious cycle with the fund balance."
Bowerman previously said the $1.34 million used for the tentative 2013 budget was due to to the board's history of reinstating cuts he placed in the budget. Previously, the county was looking at budget figures that showed a $4 million shortfall. To bridge this gap, the preliminary budget uses the fund balance and increases revenue estimates from sales tax by $900,000 and boarding inmates at the county jail by $500,000. The plan includes no funding for the Office for Aging and Cornell Cooperative Extension, saving $400,000. It lowers the Soil and Water Conservation District's funding by $37,000.
According to Stagliano, there is no real way to increase the fund balance the way it was previously done.
"There's no nursing home to sell, there will be no sales tax increase," he said.
The Finance Committee's previous suggestions for the budget includedr laying off 35 employees, eliminating all funding for outside agencies, using no fund balance and staying within the statewide cap on raising the tax levy.