The government of Effingham County is in a strong financial position, its recent audit revealed.
The county’s general fund balance has grown from approximately $12 million to nearly $25 million, according to finance director Joanna Wright.
“That sounds like an awful lot,” she said, “but not when you’re trying to run a government, which currently, there is a need for a stabilization in our revenue sources.”
Wright said it is the county’s ability to fund its current expenditures that has put it in a better position than most other governments.
“A lot of governments are in trouble because of the expenditures they have made in the past, or they do not have the cash in hand to be able to operate,” she said, “ given the decline in revenues.”
Overall, the county’s fund balances — including the special local option sales tax — are at around $42 million, up from nearly $23 million in 2006. The county also has a rainy day reserve of $4.2 million that is set aside to continue operations in case it fails to receive revenue.
“When we started this, who would have dreamed tax revenues would start coming in two months late?” said Donald Caines of Caines, Hodges, Pace and Company, the county’s auditors. “Some governments in that situation would be in serious, serious trouble.”
Total revenues for the past fiscal year were $41.1 million, with more than $30.2 million coming into the general fund. The county’s SPLOST revenues were $7.7 million.
Property taxes made up 54.29 percent of the general fund revenue, 22 percent of the general fund revenue came from sales taxes. The county also earned more than $475,000 in interest because of its healthy position in cash and cash flow, according to Wright.
“Over the last five years, we are trying to gain additional revenues from grants, charges and fees,” Wright said, “something other than taxes. We are charging for services and seeking funds from additional sources.”
Expenditures last fiscal year were just under $27.9 million, giving the county a surplus of $2.346 million. That, in turn, increased the fund balance.
“This will help stabilize the revenues we see declining in the current year,” Wright said. “Each year, in watching what we spend, we have been able to maintain expenditures under our budgeted amounts while still gaining revenue to ensure our expenditures are covered.”
In the county’s general fund, 57 percent of the expenses are in personnel. Purchased services and contracts account for 22 percent of the spending.
In regards to operations, about 44 percent of the county’s expenditures, or approximately $15.7 million, are on public safety, with 17 percent ($5.9 million) on public works and 6 percent ($2.346 million) on judicial operations.
But the county’s local option sales tax proceeds are being impacted by a decrease in sales tax.
“Two years ago, we peaked,” Wright said. “The last two months of the year, the LOST we received significantly declined.”
The county’s water and sewer operations have gained customers, but the operations are continuing to run at a deficit. Operating revenue was at $94,000 for the last fiscal year. But there was a loss of $613,000 in water and $991,000 in sewer operations.
The number of sewer customers has gone from 60 in 2006 to 388 in 2009, Wright said.
“Our customer base has continued to increase,” she said. “As that customer base increases, we will receive additional revenues.”
Caines said the county finance department’s operations are headed in a positive direction.
“There were times in the past we couldn’t have said that,” he said.
The county’s audited financial statements, along with the management discussion and analysis, are more than 90 pages long.
“General Motors doesn’t have 96 pages in its financial statement,” Caines said.