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Wall Street directly impacts countys investments

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Surpluses can’t be used for refunds to taxpayers

The Ellis County Press

WAXAHACHIE – As Wall Street is decimated by a disastrous economic tidal wave, County Auditor Mike Navarro is monitoring county government finances – some with not-so-good results.

"As the interest rates decline across the country, it directly impacts the interest rates that we are able to earn on our investments," Navarro said.

"So, it will cause lower interest earnings for the county without a doubt. It will not impact what we have to pay out for the bond debt, as that was fixed at the time of issuance.

"In our budget for next year, I had already planned for lower interest earnings so it won’t have a big negative impact on our planned budget."

Navarro, appointed to his position over a decade ago, said the financial situation nationwide will hit Ellis County’s governmental budget the hardest in areas such as fuel costs and services.

Surpluses for the annual budget, however, are placed into bank accounts called a fund balance (think: savings account) where they accrue interest, Navarro said, which are then used to fund payroll and other county bills in anticipation of property tax payments in January.

Ellis County’s budget year starts in October.

"Budget surpluses roll into fund balance at the end of the fiscal year and yes, I invest those funds to earn interest until we have to pay bills and payroll," Navarro said.

"We use the fund balance to meet the cash flow needs of the county during the first few months of the fiscal year, [October, November, December] because the bulk of our revenue from property taxes does not come in until the last week or so of January."

While surpluses are healthy for a local governmental body, Navarro said nothing allows for a Taxpayer’s Bill of Rights like in Colorado or Alaska, where general revenues of state budgets are sent back to taxpayers in the form of rebate checks.

"To make it even simpler to understand, it’s kind of like if at home, you worked from January until December, but you didn’t start getting paid until April," he said.

"You would have to have some way to live from January through March, and you would do that by taking money out of your savings [fund balance]until you started getting paid your wages…even if we wanted to give back the money to taxpayers, criminals [from fines, fees and collections] and users of our services, then we could not by law do it under the current statutes.

"There is no mechanism in the law that would allow counties to send those types of ‘rebate checks,’ even if a commissioner’s court and 140,000 people wanted to do it unanimously.

"We are not like George W. [Bush] and the feds who seem to be able to arbitrarily issue ‘tax refunds’ to people to suit their own political purposes."


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