WINNSBORO – Fairfield County’s budget woes are reaching new heights, with council members failing to adopt a budget on second reading and facing worsening news about the annual audit, now almost seven months overdue.
On Monday night, the council voted 3-3 at second reading of the 2023-2024 budget, resulting in its defeat. Annual budgets require three readings by majority vote to pass.
A second attempt at first reading was scheduled for June 14 and a second reading on June 15, both readings occurred after The Voice went to press.
According to County Attorney Tommy Morgan, the third reading must be held at least 15 days after second reading. That would put third reading at June 29.
Council members Clarence Gilbert, Dan Ruff, and Peggy Swearingen voted to approve the budget on Monday night. Shirley Greene, Tim Roseborough, and Neil Robinson voted against.
Council Chairman Doug Pauley left the meeting before the vote due to a family emergency.
Now the council must scramble to reschedule to adopt a budget, which according to state law must occur by June 30.
Criticism Mounts
Council members caught flack from citizens, who decried the county’s handling of fiscal matters, its failure to post on the county website and the Association of Counties website for a qualified administrator to run the county.
The county hired Laura Johnson, a former Director of Finance for the County, to serve as interim administrator from January through June, 2023, at $12,500 per month ($150,000 per year). She also worked as assistant administrator for more than a year under then County Administrator Jason Taylor.
District 2 resident Valerie Clowney scolded council members for failing to focus on essential needs of taxpayers, especially those living in poverty.
“How do we not have money for the bare necessities, but do have the money for frivolous agenda driven projects?” Clowney asked. “If the county is having a hard time making ends meet, how do you think the citizens are doing?”
District 1 resident Randy Bright also took aim at Fairfield’s failure to meet critical budget deadlines.
“Two years in a row, we missed the audit deadline by a combined total of nine months. Two years in a row, we’ve done a budget without good insight into how much money we have,” Bright said. “That makes two bad budgets. We’ve flown blindly because of these bad audits and financial misreporting.”
Tax Increase on the Table
The proposed $49.3 million budget increases total expenditures by 18% over last year’s spending plan.
General funding accounted for $39 million of the total, rising 12% from last year, according to figures presented at Monday’s meeting.
To balance the budget, staff has recommended raising taxes by 8 mills, which translates to an extra $32 a year in property tax for the owner of a $100,000 home. The owner of a $200,000 home would pay an extra $64 per year, according to county figures.
Deputy Administrator Synithia Williams noted the tax estimates do not include any increases Fairfield County municipalities or the school district may enact.
“They would raise the millage in their own judgment. The county does not touch those,” Williams said.
Other than a half-mill increase to the library fund, Williams said this would be Fairfield’s first tax increase since 2016. Williams blamed the increase on rising costs of retirement, insurance, capital purchases and leading the county building.
“The revenues and the requests just did not add up,” she said.
Williams warned Fairfield’s other option is to cut agency requests, including employee cost of living adjustment (COLA) increases and capital purchases, including fire trucks, ambulances, and heavy equipment.
“If we don’t approve the millage, some of the recommendations we’d come back with are cutting agency requests, cut capital purchases, and not doing COLA for employees, which can also affect recruitment and retention,” she said.
Other Options
Fairfield could draw from its reserve fund, though county leaders traditionally dislike that option.
From 2021-2022, reserves rose from $15.87 million to $17.85 million, with $6.6 million in reserve funds currently unassigned, according to county figures.
Williams, though, said reserves rose due to one-time increases stemming from the sale of medical facilities and Dominion Energy settlement funds.
“Those are non-recurring funds that helped us have an increase in fund balance from the last fiscal year,” she said.
Before he left the meeting, Pauley asked Williams for the maximum millage increase Fairfield could impose.
Williams said the state limit for Fairfield is 13.92 mills. She added the county could potentially go higher since Fairfield didn’t pass an increase in prior years, though any additional increases would be tied to inflation in those years.
Councilman Ruff asked how Fairfield compares to other counties in funding outside agencies.
The draft budget calls for appropriating $895,221 to outside agencies, down from $963,399 in last year’s budget.
“We fund quite a few of them and it’s quite a bit of money,” he said. “I know there are good ones but there’s a lot of money out there.”
Interim Administrator Laura Johnson said she would research how Fairfield compares, but said it likely wouldn’t result in any major budgetary changes this year.
“There wasn’t enough time in this budget to go through,” Johnson said.
At a budget work session in April, council members questioned some of the proposed outside agency expenditures, including $142,929 to Midlands Technical College when only three students actually take classes at MTC’s campus in Winnsboro, according to workshop minutes.
MTC president Ronald Rhames said over 250 Fairfield students take classes at the Columbia campus. He said he’s offered to “two previous administrators to look at the agreement” and suggest improvements.
More Audit Angst
Fairfield missed another self-imposed deadline about when its oft-delayed audit would be completed.
In May, Johnson said she hoped the audit, initially due in December 2022, would finally be ready by mid-June. Now it appears a formal audit won’t be completed before the county must adopt an annual budget.
Johnson said the auditing firm told her the best it could do was to present a draft audit on June 20.
“I told them that was unacceptable,” she said. “So now they’ve given me the date of maybe [June 22] or [June 27]. I feel if it’s a draft on June 20, it’s still going to be a draft on June 22.”
The audit’s perennial delays directly led at least one council member to vote Monday night against second reading of the budget.
“I simply cannot vote on a budget not knowing how much money we have and what the audit says,” Councilwoman Greene said. “Those are things necessary and prudent in management.”
Councilman Ruff quizzed Johnson about the county’s hired auditor, floating the idea that the audit firm bore some fault.
“We are bound with this auditing firm through next year, am I correct?” Ruff asked.
“They are under a three-year contract, actually,” Johnson said. “This is the first year they were preparing an audit for us.”
“Are you satisfied? Not satisfied? How do you feel about them?” Ruff replied.
Johnson said budget calculations occurred when the county transitioned from one auditing firm to another.
“They came in mid-stream,” she said. “That’s why it’s hard to gauge. They didn’t get everything they needed at the beginning.”
The audit predictions place an even tighter time crunch on Fairfield’s budget schedule.
County Attorney Tommy Morgan stated that state law requires a 15-day notice of a public hearing before third reading. “If you do the math on the calendar, [third reading] can be done no later than [June 29] or [June 30],” Morgan said. “If third reading is on June 29, then second reading has to take place no later than June 22 [seven days earlier]. Likewise if third and final reading is on June 30, then second reading has to be done no later than June 23.”
Councilman Gilbert asked what would happen if the county failed to adopt a budget by June 30.
Morgan didn’t directly state what consequences Fairfield might face, but noted the law prohibits local governments from passing continuing budget resolutions, which are commonplace in state and federal government.
“The Home Rule Act doesn’t provide for counties to pass continuing resolutions,” Morgan said. ‘The council could move forward using last year’s expenditures, but there’s even a question about the validity of doing that.”
