The drug-seizure cash keeps rolling into Henderson, and now the police are preparing to roll some of it out.
The City Council unanimously passed the first budget amendment of the year Monday night, moving $36,436.12 into the Police Department’s federal drug seizure account to be spent as Police Chief Glen Allen sees fit. The money came to the city last week in three separate checks for drug seizures, so, as Allen noted in a memo to interim Finance Director Peggy McFarland, the amendment “will have no adverse budget impact whatsoever.”
(Mayor Clem Seifert and City Manager Eric Williams wondered whether they were setting a city record by amending the budget on the 11th day of the fiscal year, but Henderson wasn’t even the first local jurisdiction to pass a budget amendment. About an hour earlier, the Vance County Board of Commissioners enacted an amendment that gave the Sheriff’s Office a $57,643 boost to hire a crisis intervention officer.)
Allen indicated that he has some possible expenses coming up for which the money can be use, including overtime for officers filling the gaps for others who have left the department or are limited in duty because of injuries.
By putting the money in the drug-seizure expenditures account, the council spent it from an accounting standpoint. Allen will not have to ask the council for permission for specific uses of that money.
Not only did no one question the immediate use of the drug-seizure money, but Seifert and council member Elissa Yount pressed the chief on why he’s not using more of the funds. Allen said the city has about $240,000 in federal drug-seizure money, which has a two-year spending deadline, and about $32,000 in state drug money.
The city stashed $200,000 in federal drug funds in the general fund balance for this fiscal year. The money is restricted to being used by the Police Department, and limited within that department on how it may be spent, but the state’s Local Government Commission counts restricted and unrestricted funds when it measures a city’s fund balance as a percentage of spending.
According to a memo from Assistant City Manager Mark Warren to Yount on June 29, the city had received $309,901 in federal and state drug-seizure money to that point in fiscal 2004-05 and had $279,420 left. Warren wrote that about $65,000 was budgeted to be spend in fiscal 2005-06, which started July 1, while approximately $200,000 was “restricted to fund balance.”
By holding the drug money and Powell Bill funds, which may be used only for street maintenance, Henderson pushed its projected fund balance for June 30, 2005, to $1.14 million, or 8.13 percent of general fund expenses for the year. The unrestricted money in the fund balance was expected to total $465,433, or 3.32 percent, at the end of fiscal 2004-05.
That 8.13 percent is a key figure because it exceeds the LGC’s bare minimum of 8 percent. That number, council member Bernard Alston said during an earlier discussion Monday about the city’s official response to the LGC, is all the state agency is gong to care about.
But that use of drug-seizure money to prop up the fund balance has prevented Allen from aggressively using the money to fight crime now.
Seifert made a further connection between the fund balance and the drug money. He said that the reason the city drained it’s fund balance was to take a chance on a promising opportunity with Embassy Square. Now the city has a promising opportunity to attack drugs with the seizure money, but instead it’s afraid to act and risk draining the accounts. The money is only useful if it’s spent, he said.
“I have a hard time rationalizing, with the problem that we have with crime, freezing all of that money for your department,” Yount told Allen. “Do you see it as being absolutely frozen, or do you see it on a need-to-use basis you can come to us?”
The chief said he doesn’t view the money as frozen, and he noted the time limit to spend it. But he said fiscal conservatism leads him to prefer holding much of the money aside and tapping the funds as new money comes in to replenish the savings.
“Hopefully, we will continue to get revenues from the federal government that will sort of be in and out of there all the time,” Allen said. “We do need to start spending some of that money for obvious needs.”
“Why wouldn’t we spend this money now?” Seifert asked. “If we’ve got a problem we need to attack, why don’t we attack it full force? If we need to spend $280,000 on the problem, why wouldn’t we spend it now, and we’ll get more money? It’s money five years ago we didn’t have. Why wouldn’t we do it?”
Allen said he worries that the city’s crime problems will grow worse — the rates for violent crime and property crime were much higher in 2003 than 2004, for instance — but he agreed it’s time to put the money to work. He said the money in Monday’s budget amendment was a good start, allowing the Police Department to start making some purchases before a deadline next Thursday and to pay overtime. He pledged to return to the council as the budget-line account needs more money.
“I would encourage you to come to us every time you need to spend it because it is yours, it is theirs, it needs to be spent, and we don’t want any excuses for not getting crime under control in this city,” Yount said.
At Seifert’s suggestion, Allen will appear before a meeting of the Public Safety Committee, chaired by Lonnie Davis, to explain how the city gets the drug-seizure money, how it may be used and how the city can form a strategy to put the money into action.
Allen said the drug money must be used for new initiatives or to supplement current efforts. The money can’t replace property taxes in paying police salaries or creating across-the-board pay raises, but it can go toward overtime for special drug operations, for example, or to establish a special unit such as a bicycle squad.
“You are very creative, and you know what uses you can spend the money, and you know what the problems in Henderson are, and we trust you to fix them,” Yount said. “So if you need this money, you tell us.”
She asked whether the money could be used somehow in recruiting officers. Allen didn’t know, but facing more officer resignations in the coming months, he told the council, “If anybody knows anybody who wants to be a police officer,” he’s hiring.
Seifert noted one twist in a reliance on drug-seizure funds. “The problem is — well, it’s not a problem — if you get rid of drugs, you get rid of the drug-seizure money. It would be great to get rid of the drugs in Henderson and just seize them as they pass through.”
“I’d like to deal with that problem,” Allen said.
“I would too,” the mayor said. “And we need to do it. I think that the time has come. We need to pull out all the resources we’ve got available to help fix this problem.”
He said the drug money “doesn’t do you any good if you don’t put it to work. … We’ll be the most drug-infested community in North Carolina, but we got the most money in the bank. I don’t really care for that. I’d rather be broke and our drug problem gone.”