By. Brent Wilson, Field Officer
As with all localities, Greene County has their books annually audited by an outside accounting firm. At the February 25th Board of Supervisor meeting Matt McLearan, from Robinson Farmer Cox Associates , presented the audit of the fiscal year 2013 (July, 2012 to June, 2013). McLearan reviewed the five requirements of the audit –– 1) records complete, 2) misstatements, 3) disagreements, 4) opinion shopping and 5) significant audit findings. None of these posed any problem for Greene County as the auditors issued a clean report.
The main variance during the audit period was the level of expenses for the year were below budget by $3.6 million. Chairman Jim Frydl (Midway) commented that this was an indicator of good management of the various departments that make up the county. And that over the past five years since 2007, such underspending has allowed the Reserve Fund to grow each year which in turn has allowed the county to fund major expenditures. The change in the Reserve Fund in FY13 was a decrease of $700,000, however, expenditures of $1.5 million for water impoundment was made out of this fund.
The Board of Supervisors has set the minimum Reserve Fund goal of at the end of 23.3% of the annual budget, made up of 15% plus one month which is equal to 8.3%. The Reserve Fund serves multiple purposes. Primarily, it provides the locality the ability to pay the bills between tax collections. In addition, the Reserve serves as a rainy day fund for the county.
The current reserve fund is above the minimum level – 31% of the annual budget even with the $700,000 decline. So Greene consistently overbudgets, underspends and lets the excess funds flow into the Reserve Account and then the BOS applies the overage of the Reserve Fund to its most critical capital expenditure – water impoundment in last year’s case.
RFC did announce to the BOS that in the future GASB 68 will require the reporting on the county’s financial statements of the VRS pension liability. Up until now this issue has been disclosed as a footnote but starting in fiscal year 2015 it will required to be a line item in the balance sheet.
McLearan was very complimentary of the staff and especially Tracy Morris, the County’s financial administrator, as were the BOS. So from a procedural perspective, Greene County is well run. However consistently underspending a budget indicates a true demand for less funds than what is approved. The funds freed up from properly budgeting operations closer to historical actuals would allow the county to budget funds for larger projects that need to be addressed in the budget cycle rather than wait to see if there is anything left over at the end of the year for such major, critical projects.
Brent Wilson is the Greene County Field Officer for the Free Enterprise Forum a privately funded public policy organization.
The Free Enterprise Forum Field Officer program is funded by a generous grant from the Charlottesville Area Association of REALTORS® (CAAR) and by readers like you.