Adams County highway annual report shows $1.1 million negative cash; officials weigh fixes

Pat, highway department staff, presented the highway department's annual report and told the committee the 2024 highway fund shows a $1.1 million negative cash position in the department's books.

"We have 2 grants that we've been able to recover. So 1 grant, in the amount of, 468,000 and then another grant in the amount of 112,000," Pat said. He said if those grants are applied back to 2024 the ending balance would move closer to a negative $550,000.

The committee heard that resolution No. 72 20 22 had set aside about $8.3 million for County Trunk Highway work and that the department has paid roughly $8.4 million toward that project, including construction, oversight and administrative fees. Pat told the committee some of the shortfall grew from project overruns and from the inability to allocate two grants to the same bid package because the work had been advertised as a single contract.

In the meeting's administrator's report, the administrator said the item is a cash-timing issue and distinguished negative cash from a negative retained earnings or fund-balance figure. "Negative cash is different than negative retained earnings or fund balance," the administrator said, adding finance and administration are preparing a financial analysis for the July meeting to explain the causes and proposed remedies.

Committee members and staff discussed a set of options the county could use to cover the deficit, including charging the shortfall to the 2025 budget, transferring some funds from the quarry account (which the department said currently shows an excess of about $400,000), or transferring money from the department's machinery account (estimated at roughly $800,000). Staff noted prior auditors have cautioned against transferring machinery funds for other uses, but that the committee and finance director will evaluate the available choices.

Pat told the committee the status of STP (Surface Transportation Program) grant opportunities will influence planning: the department prefers to submit construction-ready projects for STP and may shift priorities to ensure a competitive application, but any decisions about new STP submittals will be shaped by how 2024 and 2025 balances are resolved.

The committee voted to send the highway annual report to the county board. Pat said staff and finance will return in July with a detailed analysis that will include whether the reported negative cash is primarily timing of reimbursements or the result of project overruns and what options the county will pursue.

Ending: The administrator said the July meeting will include a financial analysis of the 2024 negative cash, a fuller explanation of project overruns, and proposed communication changes intended to make project budgets and funding sources more transparent to the committee and the public.