From the Greencastle Banner-Graphic:
Upon learning that the originally proposed 2014 county budget was nearly $700,000 higher than the 2014 levy, the Putnam County Council needed to get creative.
In the process of reining in next year's budget, the council has learned some lessons that should help the county budget in the coming years.
One of the biggest steps in this process has been the different way the County Adjusted Gross Income Tax (CAGIT) fund is disbursed and utilized.
CAGIT funds, which were previously distributed as part of the general fund, have recently been designated by their own fund from the state. As such, there are more specific uses for CAGIT money than was previously the case.
"We have to designate uses," county council president Darrel Thomas told the Banner Graphic. "We can't just spend it when we feel like it."
With the money now separated out, what might appear to be a shortage in general fund dollars is actually just a matter of where the money is placed.
As such, the council has recently approved several measures to pay a number of county expenses from CAGIT instead of the general fund.
The first came at their Oct. 15 meeting, when councilmen approved a resolution authorizing inter-fund loans.
The resolution cleared the path for a number of reductions to the general fund and additions to CAGIT during the Oct. 21 meeting.
Among the reductions to the general fund were the bonds, telephone, postage, Medicare, PERF, Social Security, utilities and property and casualty insurance accounts.
All told, the reductions mean approximately a $200,000 savings in the general fund.
All of these accounts except for bonds will now be drawn CAGIT. No additional was needed for bonds, as all of the county's bond payments have been made for the year.
While these changes apply to the 2013 budget, they will clear the path for similar moves in future years.
Until recently, neither the council nor Auditor Lorie Hallett was aware that such inter-fund loans were possible. However, Hallett has been consulting with one of the county's software vendors who was previously a county auditor and who suggested some creative strategies to the county.
The use of CAGIT opens some doors for the council, as the fund should have a minimum balance of $2 million in 2014.
"It's not new money," Thomas said of the CAGIT funds. "It's just put in a different place and we can better identify how much is there and how we're using it."
Another change that should help the county's finances is a decree from the council that there be no encumbrances at year's end, except for payroll, which is unavoidable.
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http://www.bannergraphic.com/story/2017749.html
