$30,000 closer to 8%


It’s not a solution to the fund balance problem, but City Manager Eric Williams did have some good financial news for the City Council’s Finance and Intergovernmental Relations Committee on Wednesday.

A budget amendment the committee reviewed and sent to the full council will give Henderson’s depleted savings account a $30,000 boost, reducing the budgeted use of the fund balance this fiscal year from $49,461 to $19,001.

That is, “I think, the way you want to move,” Williams said.

“It is,” said Bernard Alston, the FAIR chairman. “Of course it is.”

Henderson’s audited unrestricted fund balance for the fiscal year that ended June 30, 2004, was below $500,000 and equal to less than 3.5 percent of the city’s annual general fund expenses. The City Council and city management are under pressure from the state’s Local Government Commission to get the fund balance up to 8 percent, the LGC’s recommended minimum, as soon as possible.

The city can satisfy the LGC by adding $388,000 to the fund balance, which is the city’s accumulated savings account, but that works only if Henderson counts its Powell Bill money, which is restricted to street projects. The city needs to save more than $600,000 to produce an unrestricted fund balance of at least 8 percent.

Wednesday’s budget amendment is a start.

The money comes from two sources: $10,000 pulled back from the Appearance Commission, which didn’t get the grant those funds were meant to match; and $20,460 from the Fire Department’s capital budget for the new ladder truck.

The city set aside far more money than was necessary for licenses for the truck because of bad information from state bureaucrats, Finance Director Traig Neal explained. The Division of Motor Vehicles said a $1,000 cap on the licensing fees for big vehicles didn’t apply to firetrucks. When Fire Chief Danny Wilkerson went to pay more than $21,000, the DMV wanted only $1,000 because of the cap, and he wasn’t about to argue the point.

Under a separate budget amendment, the water distribution budget will get $1,355 in insurance proceeds to cover repairs from a vehicle wreck that was not the city’s fault.

Also at the FAIR Committee meeting:

* Williams said he will contact auditor Curtis Averette of William L. Stark & Co. about appearing before the committee to answer questions about the 2004 audit. While council members, particularly Elissa Yount, want to see Averette as soon as possible, Neal noted the certified public accountants aren’t likely to have much free time before April 15, the annual income tax deadline.

* Council members heard about a new process for purchasing office supplies that Williams said will save Henderson money. City departments will have a choice of Corporate Express or Kennedy Office Supply for any purchase, whichever is cheaper for that particular order.