By NICOLE CARTRETTE

Columbus County’s undesignated fund balance, unofficially at roughly $6.6 million, is at a seven-year low.

The state’s Local Government Commission suggests that 8 percent of the prior year’s expenditures be on hand –for Columbus County that’s approximately $4.3 million. The percentage on hand affects local governmentss financial ratings and its ability to borrow money.

While the county has a $2.3 million margin to work with in order to stay within the 8 percent, the fund balance available decreased by more than two million dollars in 2005 and 2006. In recent years, county government has pulled from the fund to balance the budget each year in June.

In 2003 the fund balance available totaled about $12.3 million. In 2004 it dropped to $11.3 and in 2005 it sunk to $8.9 million, based on reported state treasury data.

Creditworthiness is based on bond ratings. Higher ratings result in lower interest rates secured for borrowing. Ratings range from AAA (triple A) to C or D for securities locked in default. Columbus, Bladen and Pender counties’ Standard and Poor rating is A. Brunswick County’s S&P rating is AA- and Robeson County’s S&P rating is A-.

In June, the county faced a budget dilemma when County Manager Jim Varner pointed out that the county’s financial books had not been reconciled since September 2005. The undesignated fund balance could not be determined, and finance officer Roxanne Coleman was said to be on medical leave. Commissioners speculated that taking from the fund balance was risky.

No one was sure of the amount available after deductions of $2 million to correct a DSS day care funding error, $1 million for under-budgeted Medicaid, and $1 million for a solid waste shortfall. Not to mention departments that may have over spent their budgets, officials said.

Interim Finance officer Leo Hunt was hesitant to discuss the fund balance when he was originally contacted. When asked what the undesignated fund balance was earlier in the week, Hunt replied: “I would rather you talk to the county attorney. He is the public information officer; that way I have broken no rules.”

The News Reporter left a message with the county attorney’s office and shortly thereafter Hunt returned the call.

Hunt made it clear the undesignated general fund balance of $6,614,356.52 was “un-audited” and “subject to change.” He pointed out the balance did not include a discovery made last Friday that he said would change the balance by “$1,000 at most.”

Hunt, a retired finance officer from Robeson County, said he has been working to get the books straight and hopes the county financial audit will be complete by the Oct. 31 deadline set by the N.C. Dept. of the State.

“Payroll accounting may be out of balance some,” Hunt said, without offering any specifics, but indicated auditors are expected to come in this week. The books could not be audited until corrections were made.

One-fourth of the nation’s “Triple A” rated local governments are located in North Carolina. The state’s local governments borrow money and pay for capital projects at interest rates generally less than interest rates incurred by equally rated local governments in other states, according to the state treasury department.

The General Assembly established the Local Government Commission because of local government financial problems during the depression in 1931. More than 60 counties, 152 cities and towns, and about 200 special districts were in default on outstanding obligations in 1933.