Beaufort County's Financial Wizards | Eastern North Carolina Now

    Beaufort County has a hole in its budget bucket. It is leaking money. But, the water level never goes down. Here is how the commissioners run their money bucket. They take credit for increased income while they take money out thru the hole. The budget is always balanced. This is also called off-the-books accounting.

    I have, for years, tried to spark interest in the operating finances of Beaufort County. That is, the day to day operations, where the money goes, and how are the various spending centers doing in meeting their budgets. Are we spending more money than budgeted or less and why?

    My wish finally took root at the March Commissioner's meeting. A 15 minute presentation was made by the finance officer, Anita Radcliffe. The presentation included a discussion of revenues, the increased sales tax collections, and the status of property tax collections. Property tax collections year to date are approaching 99 percent.

    Mrs. Radcliffe noted that all departments were at or below their prorated spending amounts. Commissioner Rebholz praised the presentation and ignored the hole in the bucket.

    Historically commissioners have had little interest in monthly financial reports. The biggest reason for lack of interest, in my opinion, is because I am the only commissioner (thru the end of last year) who has had responsibility for managing a budget. Langley and Booth were both government employees, Brinn had a business but stayed in debt, Frankie Waters was a bank loan officer, Jerry Evans has a business, but reports are that it is run by someone other than him. That leaves only Stan Deatherage who runs his personal communications business. So there are five commissioners who are clueless about budget management. That is why we have poor budget management and taxes go up every year. There is one more sinister incentive. If these guys spend too much money, they just raise taxes. We cannot do that in the real world.

    Taxes have gone up 22 percent during the past four years. Using a "continuation budget" they do not have to worry about spending and controlling costs,, they just raise taxes. Most of the managers in county government spend enough so the next "continuation budget is always raised, never lowered.

    The Sheriff, in particular, has a neat trick. He gets a budget in July. If he overspends in one line item, he just comes back to Waters and Associates and gets more money. He never covers the unexpected costs by shifting money from other parts of his budget. Then towards the end of the year he pulls the under-spent line items together and blows that money too. All this is done without Commission oversite. This year he gave about half of his upper level employees raises between three and seven thousand dollars. These practices are what is raising taxes..

    I deliberately did not ask questions at the March meeting when the financial report was given, although I had several. The reason I didn't is because, I want the reports to continue each month. Also, I was waiting to see who would ask questions and how relevant they would be to budget control.

    It is significant that no commissioner asked a question. Why? Could it be the report was perfect and everyone but me understood the budget? Or, could it be these commissioners did know enough to ask a question? We will have the answer after a few more monthly presentations. I believe these guys are following the old advice of "Do not as a question and show how little you know".

    There was a good reason why the budget is so perfect. The majority of the commissioners adjust the budget, that is move money around or create a capital ordinance to make sure the budget is always perfect. For example the Sheriff is 2 million dollars over budget because of terrible management in the jail. So the majority of the Board created a capital ordinance to hide the over spending. The capital ordinance took the money out of the operating budget. In effect, the majority simply added more money rather than stop the leak.

    A good example of sneaky budgeting and is the need for almost a one half million dollar increase in jail spending during March. Mrs. Radcliffe proposed moving the surplus in sales tax revenue to a Sheriffs capital projects budget to cover up this poorly managed increase in expense. This creates not one but two financial mismanagement sins at the same time. That is, good financial practice is to take all revenues into the general fund and to then appropriate all spending from the general fund. Bypassing the general fund is a shell game. It allows the failure in budgeting to be covered up. It makes the Finance Officer, the Manager, the Sheriff and some lazy commissioners look good. They could proudly say we have a "balanced budget".

    What it really does is rob other needs for money for legitimate purposes. Government budget mangers don't have to make tough decisions like private business managers do. And, in this case the "extra money" given to the Sheriff's budget was not available to give non-Sheriff personnel a raise, for example. It's a neat trick if you can get away with it. This behavior is approved by these five commissioners.

    While county employees can make these tactics work with the auditors, it is still bad financial policy and leads to distortions in accounting for money. It is true, as they say,. it is the same government pot of money but it covers up bad financial practice on the part of commissioners and bad management...