By Larry Riley in the Muncie Star-Press:
The Delaware County Auditor’s office has prepared the first projections for 2014’s financial outlook.
Forecasts take the form of a spreadsheet, an elegant tool into which one can input various scenarios to calculate the effect of the vagaries of unknown, though suspected to be declining, revenues through the coming months
And yet, this is — to put the phrase mildly — not a pretty picture.
The projections show red ink by the end of February.
That would closely conform to last year, though we made March before running out of cash and dipping into the rainy day fund for $2.8 million to shore up the general fund, which pays for most routine operations of county government.
One reason for getting through until March was because the operating balance beginning last year was $600,000 higher than what we started this year with, $3.3 million.
The extra last year would have just about taken care of a two-week payroll, of which January of both last year and this year have three paydays rather than the usual two.
(The county pays every two weeks for 26 pays, hence a couple of months have three paydays. This year, as with every seven years, the county will have 27 pays, but total salaries earned remain the same.)
The Delaware County Council opted to not repay that rainy day fund loan last year in full, but did pay back about $1.4 million. That’s probably the first place to which council members will turn to stanch the red ink next month.
Were they to take all $1.4 million, that would still leave $125,000 in the rainy day fund balance, which might help out in a future emergency that isn’t too wet.
Still, by the end of March, projections would be for a negative $2.2 million balance, so that would only help for 30 days.
County council did introduce an ordinance in December authorizing the issuance of tax anticipation warrants, and an Indianapolis consultant is reviewing cash flow data (surely they’re pessimistic) to “properly size” the warrants.
The aim would be for the county auditor to be able to borrow in $100,000 increments as needed. The state’s Department of Local Government Finance, though, has to approve a total amount the county can borrow.
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See the full article here:
http://www.thestarpress.com/apps/pbcs.dll/article?AID=2014301190017
