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Saratoga County officials expected to authorize borrowing to cover cash shortfall

Monday, September 16, 2013
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— Saratoga County supervisors are expected to authorize short-term borrowing of up to $14 million for early next year, though they hope they won’t have to actually borrow.

The tax anticipation notes would cover the county’s payroll and other cash needs in the early part of next year, before property tax revenue begins to flow in.

By some estimates, the county could have as little as $3 million in cash on hand at the end of the year, the county board’s Law and Finance Committee was told last week. The panel approved the plan for short-term borrowing, sending the matter to the full Board of Supervisors on Tuesday in Ballston Spa for final approval.

“We won’t know for a couple of months, but we want to be prepared if needed,” said County Administrator Spencer Hellwig III.

Supervisors approved a similar $14 million borrowing authority last year, though in the end the county didn’t need to borrow any money.

“It’s simply for cash flow. It’s a good prudent move in case we do need it,” said Supervisor John E. Lawler, R-Waterford.

The county, which for years was known for its financial health compared with other municipalities, has faced a squeeze in the past several years as the recession hurt sales tax revenues, and there were tens of millions of dollars in losses at the county nursing home.

County Treasurer Samuel Pitcheralle said the estimate of only $3 million in available cash on Dec. 31 doesn’t account for $4 million the county expects to be paid for selling its landfill, or some anticipated state aid payments.

While property tax bills are mailed out around Jan. 1, Pitcheralle said it’s mid-February before the county starts to see significant revenue from those bills, and officials want to know they’ll have cash during the interim.

“It’s just so we’re not in a situation where we don’t have a shortage of cash,” Pitcheralle said. “We won’t borrow if we don’t have to.”

The borrowed money would be used to meet payroll, health insurance and other costs early next year. The bonds would be paid off when the tax revenue is received.

In general, things have been looking up for county finances over the last year. The county had a $10.3 million fund balance at the end of 2012, compared to a $6.5 million balance at the end of 2011.

Pitcheralle said the fund balance includes money due the county and not received, and is a significantly higher figure that the “available cash.”

 
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