Cannon County Budget Policy

Goal: To develop principles and policies to guide the budget process.

The Cannon County budget policy will ensure fiscal responsibility when developing a compliant budget for each fiscal year. The County Commission will follow the budget policy in order to comply with the Comptroller’s Office of State and Local Finance requirements. Developing a budget should optimally align available resources with the need for services in the county.

The County Commission understands:

• There are limited options for recurring revenue: lo provide for services.
• The property levy is the only source of local revenue over which it has full discretion.
• An increase in the property tax levy may be required in order to achieve a balanced budget.
• The need to take the necessary steps in order to meet the County’s adopted fund balance policy including reducing expenditures, increasing revenues, or a combination of both.

Budget Calendar

The budget calendar is to be adhered to by all elected officials to ensure the county is capable of adopting a balanced, responsible budget for the operation of required county services.

December 6, 2018       County Commission adopts budget policy/calendar.

January 21-31, 2019       Department Heads turn in their budget requests for fiscal year 2020.

February l-28, 2019       County Executive’s office compiles budgets for the Budget Committee.

March 7, 2019       Budget Committee meets to review budget.

March l4, 2019       Budget Committee begins meeting with department heads.

May l6, 2019       Deadline for the County’s Board or Education to submit school department’s proposed budget to the Budget Committee. The County will follow the budget timeline for the county school budget as outlined in TCA 5-9-402.

May 2-31, 2019       Budget Committee completes final draft of budget to present to the County Commission.

June 1-30, 2019       County Commission reviews draft budget but does not vote for approval until in .July after county management closes the books and the actual June :-30th accounts payable balances and fund balances are ascertained (to determine if’ additional revenue increase or expenditure cuts arc needed). Additionally, any fiscal year 2018 budget amendments brought forward by county management that decreases fund balance will be analyzed by the County’s Budge! Committee to determine if these budget amendments impact the proposed budget for the next fiscal year (i.e. decrease available beginning fund balance, need to increase an expenditure line item clue to a recurring expenditure such as utilities or fuel that is currently under-budgeted).

July 11, 2019       Budget Committee meets with County Executive’s office to analyze dosed book balances to determine if additional revenue increases/expenditure cuts are needed to eliminate liquidity deficiencies or unassigned fund balance deficits in any fund. Final recommendation for tax rate and appropriations budget made for full County Commission vote.

August 1, 2019       County Commission votes on annual appropriations resolution, tax levy resolution and non-profit resolution.

August 9, 20I9       Deadline for County Executive’s office to forward the approved resolutions and budget lo the State Comptroller Office of Local Finance for review to determine if budget meets minimum legal requirements.

August 1-31, 2017       If the Stale Comptroller rejects the County’s budget on grounds
of violation or state statute (budget does not balance, expenditure line items not in line with historical spending and no reason provided by the county), then the County Commission will meet in August to correct the proposed budget or tax levy in order to bring the county into compliance with statutory requirements pursuant to the Tennessee Code Annotated.

Budget Process

The formal budgetary process begins with a goal-setting, workshop for senior administrative management.

County Executive’s office by the date specified. The County Executive’s office will compile all budget requests into a budget document for review by the Budget Committee during the months of March and April. At the first meeting of the Budget Committee, the members will decide which departments they will meet with based upon their requests.

The Budget Committee conducts public review meetings and recommends revisions to the consolidated budget. The Budget Committee will draft a revised and final budget by May 31st. The County Commission is responsible for final approval and appropriation of the consolidated budgets and sets the property tax rate. The County Commission will deliberate and approve a final budget by August l1st·subject to adjustment for actual fiscal year 2019 year end results.

All budget workshops, Budget Committee meetings, and County Commission meetings will be advertised and open to the public according to the Open Meetings Law (Sunshine Law) TCA 8-44-103. State law requires the county to publish the annual proposed operating budget in a newspaper of general circulation. The budget must be published no later than five (5) days after it is presented to the County Commission. The budget cannot be adopted until at least ten (10} days after it is published.

Adopting the Budget

The financial plans or Cannon County are included in the annual operating budgets to project all receipts and disbursements, and present the level of governmental services and the method of distributing costs to the various funds through the collection of revenue. The County will adopt a balanced budget each year, with projected revenues equal to or greater than expenditures. The Budget Committee will approve appropriations in accordance to the required services and for optional services the Budget Committee feels are necessary for operation or the County. The County Commission will review those requests and approve appropriations they deem necessary and fiscally responsible.
The County Executive’s office will submit a budget document lo the Controller’s Office of State and Local Finance that will be bound and include the following:
I) Table of Contents
2) The budget document divided into multiple sections according to funds
3) Pages are numbered consecutively throughout the book with tabs.
4) The Appendix will include the budget calendar, budge t policy, fund balance policy, cash management policy, and debt management policy.

Budget Amendments

The County Commission is authorized to approve budget amendments throughout the fiscal year pursuant to TCA. 5-9-407. Budget amendments can be approved in two ways. The County Executive is authorized lo transfer budget amounts between line items or the same category of the same fund (excluding personnel line items). A line item transfer shall be deemed effective when the County Executive has indicated his approval by signature. All other budget amendments require resolution approval by the County Commission. The County Commission will be mindful of any amendments that may decrease the fund balance. Any amendment that will increase an object code shall come with a decrease in another object code. No budget amendments shall be approved that will decrease fund balance below the optimal amount set forth in the fund balance policy.

Fund Balance Policy

The Cannon County Commission has approved a fund balance policy lo adhere to each fiscal year. The budget policy shall coincide with the fund balance policy to reach an optimal fund balance. Please refer to the fund balance policy for optimal fund balances in each fund.

Correction of any unassigned fund balance deficiencies noted in Fiscal Year 2019

The Budget Committee will review the prior fiscal year annual financial audit in the first Budget Committee meeting of the fiscal year 20I8 for its annual budget preparation. If the prior year audit noted that an unassigned fund balance deficit existed in any governmental fund at June 30th of the prior fiscal year, the Budget Committee will ascertain whether that unassigned fund balance deficit still exists. As an unassigned fund balance deficit denotes that legally restricted funds have been used for purposes other then what they were legally restricted for, the Budget Committee will take immediate steps to correct this unassigned fund balance deficit. The Budget Committee will recommend increasing revenue or decreasing expenditures for the next fiscal year’s budget to completely eliminate the unassigned fund balance deficit that was identified by the audit and bring the County back into compliance with State Statutes.

Correction of cash flow/liquidity issues noted in Fiscal Year 2019

As cash 11ow is so low in the current fiscal year that TRAN’s will have to be issued for payroll and vendor payments in the first two months of the next fiscal year, the County Commission will not pass an annual budget until the last week of July to allow the County Executive’s office to close the books for the prior fiscal year and accrue the actual year end payables balance.

The County Executive’s office will notify the County Budget Committee at the end of May and June 2019 if any accounts payables to date have been held by the office due to lack of available cash and what is the current balance of those unpaid accounts payable, as well as any late fees and penalties being incurred by these late payments, so the Budget Committee can take these amounts into consideration for the FY 2020 budget.

The County Executive’s office will report to the County Budget Committee the balance on June 30 accounts payable alter the books are closed, as well as the reconciled cash balance for each fund at June 30th as soon as the closing process is completed in July. The balance of the accounts payables at June 30th that have to be paid by Tax and Revenue Anticipation Notes (TRANs) proceeds instead of current available cash with Trustee at June 30th will be included in a current year tax increase or reduction in budgeted expenditures. Example: The County issues (TRANs) at July 1 for cash flow purposes. The county executive’s office does the year end general ledger close and there is a $250,000 balance in accounts payables for the General Fund at June 30th but only $15O,OOO of cash with trustee in the general fund at June 30th. The County Commission votes to raise property taxes for the current fiscal year to current for/correct the $ I00,000 liquidity deficiency noted at June 30th

 

Approved this 6th day of December, 2018.

APPROVAL:

Brent D. Bush, County Executive

ATTEST:

Lana Jones, County Clerk

 

Approved this 6th day of December, 2018.

APPROVAL: ATTEST:

Brent D. Bush, County Executive Lana Jones, County Clerk