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County Council, February 21

Another “unqualified opinion” auditor’s report
FY2014 budget outlook good
Warwick Jones

It was smiles all round at last night’s Finance Committee meeting. The County was heaped with praise by its auditors who gave again an “unqualified” opinion on its accounts and funds; staff gave favorable reports on the 2013 budget and the outlook for the FY 2014 budget. The Committee also agreed unanimously to approve the Greenbelt Bank grant to assist the purchase of land abutting Angel Oak.

The “unqualified” opinion by the County’s external auditors has become commonplace – an uninterrupted 25 years according to the auditor’s representative. He spoke of the very high quality of the accounting staff and the highest bond rating -AAA - assigned the County by the rating agencies. He also noted that the term “unqualified” had been dropped by the profession and replaced by “unmodified”. It seems that some folk were misinterpreting the word “unqualified”. “Unqualified”, and now “unmodified”, means that the accounts presented were not qualified or modified by any comments from the auditor. In other words, they are a true and fair representation of the financial condition and performance in the opinion of the auditor.

Staff usually makes a review at this time each year of the outcome of the Fiscal Year that has just closed and observations about the current Fiscal Year. FY 2013 ended favorably. The County’s Environmental Management Fund had a $4.8 million improvement over that budgeted. It seemed a deferral of Capital Spending was the major factor behind the improvement. However, the gain was somewhat offset by a decline of $0.9 million in available funds in the General Fund, largely reflecting less than expected sales tax revenues.

The current fiscal year was also looking good. The General Fund revenue was expected to be about $2 million higher than budgeted reflecting a higher property tax base. It could have been more but for a fall in revenue derived from the Federal Government for “federal prisoners”. Staff suggested that maintenance spending could be higher than originally budgeted in the General Fund. It also noted that offices and departments are working within budget to resolve unplanned costs. However, staff expected overall cost savings about $2 million for the year in the General Fund. Staff also noted that Transportation Sales Tax revenues and Local Accommodation Tax revenues were growing. We presume this implies that there will be no surprises at year end.

So Council member Schweers asked, does this mean there will be no millage increases in 2014. Staff was hesitant to comment, understandably as they don’t make such decisions. County Administrator Taylor however was not daunted by the question. No increase, he exclaimed!

The Greenbelt Bank grant for Angel Oak has been well covered in the media and we will make only mention of it here. We thought there might have been some heat in the discussion by the Committee but there was little. Some Council members had publicly expressed anger at the grant, not because of its purpose but because it had become necessary through the action of the City of Charleston. The City’s up zoning some years ago had increased the value of the property and made it that much more expensive to purchase. Because of this, the City should contribute more to complete the land purchase, the Council members said.

Some critical comments were made again about the City last night. But all Council members seemed to agree that despite their views of the City’s past actions, the purpose of the grant was noble and laudable, and should be supported. Council member Qualey was probably the most vocal of the critics but last night he confessed that he had been persuaded to change his stance on the grant by the admonition of his son. Predictably his confession provoked many jibes, but all were good natured. So a grant was approved of $2.5 million to buy the 18.7 acres that lie to the north of the iconic tree. The property will be managed by the Low Country Open Land Trust, the recipient of the grant.

Two other grants were approved last night, though with conditions. They were applications by the Community Life Enrichment Center for $591,588 to purchase 11.6 acres in the Awendaw area, and by the Ten Mile Neighborhood Association for $1.4 million to buy 11 acres abutting the PRC’s Caw Caw Park. The conditions imposed related largely to obtaining up to date valuations. The property adjoining Caw Caw will pass to the PRC if the Ten Mile Neighborhood Association does not fulfil its obligations.

There was not the unanimity in the support for these latter projects as for the Angel Oak, but they were approved. There was little information in the public documents about the projects. Council member Qualey opposed the Ten Mile application though gave no reason. He and Council member Schweers opposed that of the Community Life Center. Council member Schweers noted the absence of information, that the application had been rejected before and he could not see what had changed. Council member Sass abstained from the vote.

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