ERWIN — The Unicoi County Commission has voted to publish the county’s 2020-21 budget with more than $500,000 in deficit spending drawn from the county’s general fund balance.
Already cited by auditors for drawing down nearly a third of the general fund balance to cover $337,000 in projected expenditures over revenues in the current year's budget, commissioners last week discussed balancing this year’s budget with a property tax increase of 10.5 to 17 cents.
A final vote to approve the budget is scheduled for June 22, a little more than a week ahead of the July 1 deadline to submit the budget to the state.
In a specially called meeting Monday, the nine-member commission approved the new budget for publication by a vote of six to three with commissioners Marie Rice, Jason Harris and Jamie Harris opposed.
Rice argued against publishing the budget, saying the move will force the commission into a last-minute decision on how to balance the budget and take away its opportunity to avoid the deficit spending.
“There are several things you can do to help this budget,” Rice said, suggesting the use of reserve funds in the Sheriff’s Department budget and the return of a one-cent share of the county’s property tax rate that was transferred to the Highway Department in a previous budget year.
“That should not be left to the last minute. The only options you will have are a tax increase or reserve (general fund balance) and you can’t use reserve this year,” she said.
In a meeting of the commission’s budget committee Thursday, County Mayor Garland “Bubba” Evely cautioned commissioners that a further reduction in the general fund balance could impact the county’s cash flow for day-to-day operations.
At that time, commissioners were attempting to make up a $328,000 budget shortfall attributed to recurring expenses that were met with one-time revenue sources in the current year’s budget, including a three-year incentive pay-raise program for all county employees.
In the Budget Committee’s discussion of how to cover the $328,000 shortfall, Committee Chairman Stephen Hendrix said a 17-cent property tax increase would erase the deficit and also allow the county to rebuild some of the general fund balance used to balance the current year’s budget.
The state comptroller’s office recommends local governments maintain a fund balance equal to about three months of operations, or a little more than $1 million for Unicoi County.
On Monday, Evely and County Financial Director Karen Bailey told the commission $174,000 in projected expenses for the county’s new Emergency Medical Service has upped the county’s total 2020-21 expenditures by $174,000 and put the total budget shortfall at $502,481.
According to Bailey, the shortfall was automatically deducted from the general fund to prevent a deficit budget.
Hendrix made the motion to publish the budget. Commissioner John Mosley seconded the motion. Commission Chairman Loren Thomas and Commissioners Glenn White, Matthew Rice and Todd Wilcox joined Hendix and Mosley in the majority vote for approval.