2018 county audit shows growing reserves

JOANN KALENAK, DCCR — On Aug. 6, 2019, contract auditor Pete Blair presented Delta County Commissioners and the public the results of his 2018 examination of county finances. Blair summed up his opinion in just a few words, “the financial statements referred to (in the report) present fairly … (and) ended in accordance with accounting principles generally accepted in the United States of America.”

Blair reported that assets exceeded liabilities by $166.5 million at the end of 2018 — a 3.9% increase over 2017. Of this amount, he said, $18.7 million remained in ending reserve balances; $144.8 million comprised capital assets including land, construction in progress, buildings, machinery, equipment, and the County’s road and bridge systems. Three million remained in restricted reserves — a TABOR reserve of $525,000, special road projects and gravel inventory reserves of $2,033,736, and Conservation Trust Fund recreation project reserves of $453,767.

Expenditures in the 2018 General Fund — the County’s main operating fund — were 1.8 percent below anticipated budget, increasing revenues 12.9 percent. End result: An ending balance of $4.5 million. This increase was 20 percent higher than 2017’s ending balance. Revenue increases came mostly from higher than anticipated sales tax revenue, special ownership taxes, and County Clerk and Sheriff department fees.

The County maintains seventeen individual governmental funds including the General Fund. It also maintains two “proprietary” funds (accounts for county operations run like a business) — one for the County’s landfill business and the other for its 9-1-1 emergency call business. County Commissioner policy is to keep unrestricted fund balances in the General Fund at no less than 25 percent of operating expenditures. In 2018, the unrestricted fund balance in the General Fund was 42.4 percent of operating expenses — 17.4 percent over policy minimum. Overall, unrestricted fund reserves totaled $18.7 million, or 54% of the $34,608,504 in total allocations in the 2018 budget.

Revenues in 2018 for non-business, governmental activities were $29,372,594 and total expenditures were $23,857,712, increasing the County’s net position by $5.5 million by the end of the fiscal year. Landfill Operations and the E911 funds ended the year with $2,031,193 in reserve — a 20.8 percent increase over 2017.

By state statute, a proposed operating budget is submitted to County Commissioners prior to October 15 of each year, for the fiscal year commencing the following January 1. The budget must be legally adopted by Dec. 31 and the County Commissioners must approve any supplemental appropriation by passage of a resolution (in 2018 Commissioners approved one supplemental appropriation totaling $181,000 which increased appropriations from the original budget of $34,427,504 to $34,608,504).

According to Blair’s report, several factors played a role during the development of the 2018 budget: Increased growth in mandated federal and state programs while decreasing dollars for implementation and capacity; mandated additional courtroom facilities and increasing demand on an aging county jail; a decrease in severance and federal mineral leasing dollars in comparison to previous years; the challenge to meet the desired levels of programs and services for constituents as revenues show conservative growth; and limited growth in oil and gas exploration and production due to market conditions.

PICTURED: General Fund Major Reserve Increases

Revenue increases to the General Fund in 2018.

NOTE: The County levied a one percent sales tax in 1969 and receives sixty percent of the revenue — the remaining forty percent goes to City of Delta and town municipalities based on population data from the most current census.

In 1982, an additional 1 percent sales tax was levied, all of which goes to the county. Seventy-five percent is used for capital improvements and 25 percent are unrestricted funds.

READ THE 2018 COUNTY AUDIT REPORT