Rutherford County commissioners review budget, consider seeding capital fund with FEMA reimbursements

Rutherford County commissioners met in a budget workshop to review the county's recommended operating budget and a proposed Capital Investment Fund (CIP), with discussion focused on conservative revenue assumptions, fund-balance policy and whether to set aside outstanding FEMA reimbursements for capital needs.

The Chair opened the workshop and said the tax rate would remain unchanged and that the recommended budget was conservative on revenue projections. Finance staff told commissioners the county was holding roughly $4,000,000 in state loan proceeds and that the county typically budgets property-tax collections using the prior year's audited collection rate (about 98–98.5 percent), rather than optimistic projections. "I personally do not think that we would, the county will go into that $2,000,000 for a whole," the Chair said when discussing available reserves and how much might be needed to balance the budget.

The finance director characterized the CIP as a multi-year (three- to five-year) plan, not a 12-month spending document, and said the recommendation is to move one-time receipts into a separate capital fund so purchases are not made all at once. Commissioners discussed moving outstanding FEMA reimbursements into the capital fund to seed the CIP; staff estimated FEMA reimbursements that were outstanding at the prior audit were in the roughly $21 million to $25 million range. Commissioners emphasized that setting the money aside in a capital fund is not the same as spending it immediately.

Commissioners and staff also reviewed recurring and one-time pressures that affect fund-balance projections, including recent budget amendments for foster care and out-of-county inmate housing. Finance staff told the board the recommended budget anticipates some budget amendments in the spring and aims to leave unspent amounts in place to reduce the need to draw more than an estimated $6–7 million of fund balance this fiscal year.

The board agreed staff would prepare the formal budget ordinance and fee schedule for a June public hearing and that county financial advisers would assist with language for a fund-balance policy to guide transfers into the new CIP.