At the end of the second quarter of 2013, Tooele County’s cash flow projection showed the county running out of cash before the end of June.
The projected cash flow shortage, along with uncertainty about the future of federal payment in lieu of taxes, triggered three months of budget cuts, staff reductions including the elimination of some departments, closure of facilities, cancellation of county sponsored events, and the first general property tax increase for the county in 25 years.
However, a financial report for the first quarter of 2014 shows a turn around of the county’s financial health.
As of March 30, 2014 the county had a cash balance of $9.4 million compared to a balance of $4.2 million on the same day in 2013, according to Tooele County Treasurer Jeremy Walker.
Walker makes daily entries on a spreadsheet that graphs the county’s cash balance for the last six years.
“Our cash balance is now back up to where it was in 2009,” he said. “2009 was kind of a banner year for the county.”
According to Walker, the increase in the county’s cash balance is the result of the county commission’s financial recovery plan that increased the county’s fund balance by reducing expenses and increasing property tax to generate $2.6 million in additional revenue.
“We have stayed the course with the plan and it is working,” said Walker.
A budget update from Tooele County Auditor Mike Jensen, who serves as the county’s budget officer, also reflects good news: revenue is up and expenses are down.
Revenue for the months of January and February 2014 is up from $560,000 for the first two months of 2013 to $1,267,000 in 2014, a 126 percent increase. The books on revenue for March 2014 have not yet been closed, according to Jensen.
“The biggest increase in revenue is a $372,000 increase in mitigation fees over the first two months of 2013,” said Jensen.
The bulk of the increase in mitigation fees is from EnergySolutions, he added.
The early increase in mitigation fees is encouraging because the county budgeted for mitigation fees to decline slightly in 2014.
On the expense side of the budget, spending was down 7.2 percent from $3.24 million in the first three months of 2013, to $3.01 million for the first three months of 2014.
The county also booked a $2 million repayment of interfund loans to the Deseret Peak fund from other county funds at the end of 2013, according to Jensen.
Accounting entries that will be reflected in 2013 year- end financial statements returned $972,650 to the public health fund, $650,000 to the transient room tax fund, $176,000 to the road maintenance fund, and $124,000 to the municipal services fund.
The 2013 repayments leave $4.6 million in fund loans that still need to be paid back.
If present conditions continue, those repayments may be concluded by the end of 2015, said Jensen.
“The repayment of the loans does not change the county’s bottom line,” he noted. “It just means these funds now have their full fund balance available to use.”
The four funds that were repaid at the end of 2013 were the funds that are externally restricted by state law. The remaining funds that are owed money are locally restricted funds, like the general fund and capital projects, according to Jensen.
Walker said, “We will continue to monitor the progress of the county’s financial recovery plan and make quarterly public updates at county commission meetings.”