Facts Matter: The $24-million Fund Balance

Citizens deserve accurate information from a knowledgeable source, so they can be an informed participant in their government. That is what we provide. Here are the facts concerning the county's current financial health directly from the source itself - Walker County Government.

The Walker County Board of Commissioners currently faces critical decisions on spending, revenue, and service levels, and those decisions will be based on accurate information and a clear picture of the County's financial position.

The debate over the county's finances falls into two categories: the fiscal year budget and the fund balance. One looks at the county's current financial situation, while the other reveals the county's long-term financial health.

The Fund Balance:

The County's most recent audit shows an unassigned fund balance of $24,114,548, which means the county's finances are healthy. These are dollars that can be used to fund an emergency disaster response, a one-time capital project, or cover a revenue shortfall during an economic downturn.

Why "spending" increased in FY2025:

Early in this administration's term, additional funds were required for expenses incurred from the past administration and the Board for budget year ending September 30, 2025. These expenses include:

• 2024 road project indebtedness totaled almost $10 million and had to be paid immediately
• Unresolved long-standing safety issues like light pole repairs, culvert replacements, and guardrail repairs were necessary, but unbudgeted
• A 2021 Board commitment for $5 million to invest in the Walker County Water and Sewerage Authority's water improvement plan was past due
• A decade of underfunding the county's pension plan was corrected when the Board unfroze the employee pension plan in FY25 at a net cost of $5 million
• A one-time expense to restructure the county's paid-time off (PTO) policy occurred. The county spent $1.2-million to buyout PTO balances and institute a new maximum number of hours that employees can accumulate. The new PTO policy is more fiscally responsible, as employees must use their time or they will lose it. The previous policy allowed employees to bank an unrestricted number of hours, which could have resulted in some employees taking six-months off or more
• An accounting change impacted the county's net position by $14.6 million in FY25. This change impacted the county's net position in one lump sum, instead of a small amount over the next 30-years. Previously, the county treated road repairs, i.e. new pavement, as a newly purchased asset that depreciates a small amount over 30-years. Since these are not new roads, the county is no longer treating them as an asset.

Despite all of these factors, the county's unassigned fund balance declined only $802,813 between the end of FY24 and end of FY25. Walker County remains in a strong financial position with over seven-months of funds ($24,114,548) in reserves. This has been achieved by implementing operational efficiencies and by cutting unnecessary spending across the organization. We will continue to maintain this strategy going forward.

The FY2027 Budget:

Short-term, the Board continues to discuss revenue and expenses tied to the FY27 budget, which takes effect October 1, 2026. Along with inflationary increases and state mandates, some higher costs, like the new ambulance service contract, are locked in.

Some of the decisions to be made include the number of new firefighter positions, other new positions asked for by department heads, determining what percentage of cost of living salary adjustments can be provided to county employees, and how much to subsidize services that are not fully funded by user fees. The goal is to close a $1.9 million budget gap in the upcoming new fiscal budget without taking from the fund balance.

There are other options being considered that other counties have implemented to lessen the impact to the citizens. These concepts include adjusting the Public Safety fee and/or millage rate, cost-sharing agreements with cities for 911 and animal shelter services, and other fee increases for county services. The county has not advertised a change to the millage rate.

The Board will have to make difficult decisions on spending, revenues and service levels. These actions will be based on sound and accurate information along with a clear picture of Walker County's financial position. Citizens deserve leaders who are strategic and act on facts.

The bottom line is this: Walker County is in a strong financial position, but that doesn't mean there aren't challenges. The County has more than $24 million in unassigned fund balance, even after taking on significant one-time expenses and making investments in roads, water infrastructure, employee retirement benefits and essential services. At the same time, rising costs mean the Board still has work to do to balance the FY27 budget. Providing accurate and complete financial information is an important part of the process and helps ensure citizens have accurate information to understand the County's financial position and the decisions being considered.