County ‘Finds’ Enough Money to Rescind Payroll Cuts, but Leaves Them in Place (Video)

Bowie County TexasIn Bowie County Commissioners Court last Monday, July 28, it was revealed that the county unexpectedly has over $700,000 available to cover payroll, but three of the Commissioners chose to leave the cuts in place. In addition to many jobs being lost, the county courthouse no longer has an armed deputy at the public entrance.

Commissioner Carter and Judge Lacy brought agenda item #3, which sought to rescind or modify the Court’s ordered salary cuts.

Some background… Bowie County was reimbursed by FEMA (Federal Emergency Management Agency) for expenses incurred in the late 90s and the early 2000s, and it was recently discovered that the fund, which had been considered restricted, should have been deposited into the general fund. According to the county’s outside auditor, the fund should be considered cash, and spent as the Court sees fit.

Recently, Commissioner Sammy Stone made a motion that all county departments cut payroll by 15%. All four commissioners voted to approve the cut; Judge Sterling Lacy voted against it. On the 28th, Commissioner Mike Carter said he didn’t like the cut, but thought it was necessary. However, after finding the county has an “extra” $700,000+ immediately available, made a motion that the cuts be rescinded. He said, “We’re putting aside money for a rainy day when it’s pouring down outside.”

County Auditor William Tye, who was hired after the fund was established, and had always assumed it was a restricted fund, said that the money could be spent at the Court’s discretion.

Carter said, “I just don’t see why we’re protecting money, why we don’t use it…. In business you use everything you have at your disposal to make it through the year.  We have a new year coming up… it would be nice to carry some [money] over, but let’s don’t put money aside if we have it available and make our county employees suffer when it’s not necessary.”

After a few minutes of discussion about whether other funds were mistakenly considered restricted, Carter said, “Let’s don’t make people suffer when we’ve got the money, and don’t have to.” The comment was met with applause from the spectators.

Commissioner Kelly Blackburn began by questioning how the fund could be replaced, then a few minutes later said the fund should reimburse the precincts that originally spent the money, but then added that he didn’t think the outside auditor’s opinion that the fund was available as cash was authoritative.

Commissioner Carter laughed and restated that it was a reimbursement, and that all FEMA guidelines had been met. Carter said, “This was never restricted money.”

Carter continued, “It’s our decision, to what we want to do with the moneys available.” Carter pointed to Lillian Tidwell, who had spoken during public comments, and continued, “Do you want to put this lady out of a job, with four months to go before retirement, over $200,000 when we’ve got $725,000?… I don’t think I could sleep at night knowing I put her out of a job with four months to go and kids to take care of when we’ve got money…. Let’s take care of the people.”

Judge Lacy pointed out that the county had recently borrowed $5 million to make sure the county could meet it’s budget through September 30, the end of the fiscal year, including payroll – and then cut salaries anyway.

After a little more discussion, Commissioner Carter made the motion to rescind the payroll cuts. Judge Lacy seconded the motion.

County Auditor William Tye weighed in on the side of salary cuts – “If you’re not making the cuts, you’re not reducing expenses, and I think that’s what Commissioners Court originally agreed to do, reduce expenses.”

Commissioner Tom Whitten reminded the Court that the Financial Advisory Committee recommended immediate cuts, and asked Judge Lacy if he was aware the fund balance could become negative in about 6 weeks. Commissioner Carter replied, “It’s already negative. That’s why we borrowed $5 million dollars.”

Commissioner Whitten asked if there was a plan to replenish the fund, and it seemed he began to read from prepared remarks, asking, “Did you honestly think removing $500,000 from an already tight budget, from the rollback election, would not have ramifications to our employees?”

Judge Lacy again pointed out that the county had borrowed $5 million dollars, an amount calculated by the Auditor as sufficient to cover expenses for the remainder of the fiscal year, including payroll, with $400,000 left over.

Commissioner Stone retorted, “Did we cut expenses? No, we borrowed $5 million. This $5 million has got to come off the top, come January. What are we going to do with that?”

Commissioner Carter corrected him, saying, “No, it doesn’t. It’s going to be taxed on the I&S [Interest and Sinking] side.” Stone interrupted him, “It’s still got to be repaid, it’s money that’s got to come out of our expenses…” Carter explained to him that Bowie County citizens will be taxed a separate amount to completely retire the $5 million dollar debt, in addition to whatever taxes are levied to pay for Maintenance and Operations.

(It has been noted that county employees are some of the hardest hit by the Court’s recent actions – not only are they among those taxed to pay back the $5 million, some of them have had 15% pay cuts, and others have completely lost their jobs.)

Stone later said that the payroll cuts amounted to $487,000 over the next fiscal year, far short of the $2 million dollars in total spending cuts recommended by the Financial Advisory Committee.

The FAC made public statements warning the Court about “accounting gimmicks designed by non-accountants in an effort to avoid spending cuts,” that these aren’t “new” funds, and that spending them won’t help the current budget deficit.

However, if the funds had earlier been considered unavailable and are now available, it would certainly seem that would, in fact, affect the budgets. Obviously, if Whitten’s example of $500,000 being removed from the general fund (by the tax rollback) would cause payroll problems, then adding $720,000 to the general fund would solve them.

In fact, Commissioner Stone’s payroll cuts – $188,000 for the remainder of this fiscal year, plus $487,000 for the next fiscal year, for a total of $675,000 – could have been made completely unnecessary by using the “FEMA fund.”

Commissioner Carter and Judge Lacy voted to rescind the cuts. Commissioners Stone, Whitten, and Blackburn voted to leave them in place.

While it was obvious that Commissioner Carter and Judge Lacy came to Court wanting to rescind the payroll cuts, it became evident that Commissioners Stone, Whitten, and Blackburn came to Court determined to leave it in place, and were prepared to argue against any solution that would make them unnecessary.

0 thoughts on “County ‘Finds’ Enough Money to Rescind Payroll Cuts, but Leaves Them in Place (Video)

  1. If the so-called “journalist” who wrote this article can answer one question for their audience then I will be impressed: what are the values of the unrestricted net assets, cash balance and total fund balances projected to be at September 30, 2014 with the cuts rescinded and “found cash” used to pay them?” For extra credit, if anyone can tell me what the intended plan is to replenish the fund balance to meet established policy, then I will buy you and a friend a steak dinner at Texas Roadhouse, where my teenage son who works there will wait on us. If you can’t give me and the rest of Bowie County an answer to these questions, then you have no business judging or making inferences about the merits of any action taken by members of the court. The County Judge is legally responsible for putting forth specific recommendations for the FY 15 budget FIRST. Until he does, No commissioner should vote for any new spending without agreement on a comprehensive roadmap to get us out of this crisis because doing so could make the situation worse. In fact, the advisory committee has urged even further cuts, which are apparently not forthcoming.

  2. Oh and by the way, in case you weren’t paying attention, Carter and Lacy argued that they passed the $5m they borrowed off to the I&S tax account. That’s true. But they never indicated that while that was being paid off next year they would reduce the M&O tax by the same rate to avoid a net tax increase on the good people of Bowie County. What Jack Stone was arguing was that very point. Be prepared folks, judge lacy is about to leave office handing you one of the biggest tax increases in recent history. Either that or he will have to defend massive cuts. But he will not get to have it both ways like he was trying to argue at the last court meeting.

  3. My kindergartner could figure this out! We have a bunch of monkeys running our county.

  4. Mr. Cork– I am no politician or genius–but weren’t they voting on upholding their current obligations, not new spending? Also, (again, not a politician) was the advisory committee’s recommendation for further cuts before or after we borrowed 5 million dollars? If we borrowed money that was supposed to pay the county’s expenses (including payroll) until the end of the fiscal year, shouldn’t we use the money for that purpose?

  5. I don’t know the answer to the first question because I’m not sure what you mean by current obligation. The answer to the second question is that the commissioners are not sure whether the $5m will be enough to cover the total expense for this year, according to comments made by the county auditor last court meeting. But even if it was, and holding tax rates constant overall, you would have to start the year finding $5m in savings, on top of finding money to make up lost reserves, on top of running the business of the county. What many of us have been preaching is that we want to see a comprehensive plan to get us on a path to solvency that minimizes further increases in property tax. Dealing with the crisis of the day, may in fact do more harm than good financially. It’s tragic that people lost their jobs, it may not have even been necessary. But we can’t have a rational debate about what funding priorities might be until we see a multiple year plan to get us back in track. You and I don’t get paid to produce that. Once we see one from the people that are responsible, then let’s have this discussion. Problem is we have a judge that has been in continuous denial or willfully neglectful of this problem for a long time and many of us who represent the taxpayers of the county are demanding accountability. His budget is also 7 days late.

  6. A big part of the problem is a county auditor that has to continually answer financial questions with “I don’t know,” to questions that are his job to know. Why doesn’t he know??? I’m sure he’s a very intelligent man. Is he being given the information that he needs to do his job?

  7. “Established policy” may be part of the problem. Obviously it is not working properly, or the county would not be having such financial problems.

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