County learns financial position may not be as strong as earlier presented

Published 7:45 pm Tuesday, February 10, 2015

Bainbridge CPA Perry Henry approached the Decatur County Board of Commissioner Tuesday to paint a more realistic picture of the county’s financial standings.

Despite a glowing audit review by Coastal CPA Advisor Ben Lee for Fiscal Year 2014 at the Jan. 27 meeting, Henry wanted to make clear Decatur County was still fighting an uphill financial battle.

“It’s getting better, there is light at the end of the tunnel, but you still need to stay on task,” Henry said. “It’s not all bad, but it’s not quite as rosy an impression as you were left with. The numbers you were given were accurate, but I’ll be honest with you, those particular statements (Lee) was mentioning, I skip over them. Unless you know where all those numbers come from, it can be misleading.”

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Henry was pleased to announce the county’s enterprise funds generated a positive $400,000 in cash for FY 2014, yet most of that money will be used for construction in opening Cell Four at the Decatur County Landfill. As for the general fund, the county had an excess of just over $500,000, but Henry said that was nowhere near where a healthy government should be standing.

“It sounds like a lot, but not for a government of this size,” Henry said. “To be healthy you really need somewhere between 8 and 12 million at the end of the year.”

Henry also pointed out sales tax has had a major impact on the county’s financial position, including depreciation and the use of GATE cards in an agriculture-heavy community.

After requesting Tax Anticipation Note proposals for a total of $3 million in 2015, the Board approved a TAN proposal from First Port City Bank at a rate of 1.49 percent over First National Bank of Decatur County’s proposal of 1.47 percent plus a $200 loan fee and Peoples South’s proposal of 1.70 percent.

Henry said a good indicator of the county making progress was the fact that less was needed on 2015’s TAN loan. Yet one of the drawbacks of TAN is when you borrow the money, you’re already starting behind.

“I’ve been in business for most of my life,” Commissioner Pete Stephens said. “One thing I know is when you have to borrow money to pay for labor, you’re broke.”

Henry’s biggest concern was the commissioners or public thinking the county had $2.9 million in the bank, a number Lee used to describe the county’s “net financial position.”

“It’s not cash flow,” Henry said. “It’s not how much money you have in the bank. You didn’t improve your financial standing in that year that much.”

Henry said a number easy to understand is the amount of cash the county has, and although $16 million was spent of the general fund in FY 2014, he recommended at least half that amount in the bank by June 30.

“Even though Lee painted a good picture, Henry painted a more realistic picture that we still have a lot of work to do as far as the budget and we need to get the county back on a viable path,” Decatur County Chairman Dennis Brinson said.