County freezes spending due to cashflow
Butler County has halted purchase orders due to a lower cash flow than normal.
Chief clerk Amy Wilson sent an e-mail Monday telling department heads to not make any more non-essential purchase requests, saying less funding is available due to the lack of a state budget.
Wilson said halting spending in the latter part of the year often occurs.
“Typically, we do that as a matter of routine each year,” Wilson said.
However, she said the order usually is made in mid-December. She made the move early due to the five-month state budget impasse — where Democratic Gov. Tom Wolf and Republican legislators cannot come to an agreement on a budget for 2015-16 — leaving the county low on money.
Wilson said this move saves some money and makes it easier to transition from the end of this year to 2016.
If a department needs an essential purchase, it can discuss it with Wilson and the county purchasing director.
The county has more than $9 million in its general fund, but it has more than $12 million in payments to make by the end of the year.
By the end of the year, the county has to pay back its Tax Anticipation Note, which is $7.5 million. That is a debt municipalities can take out to fund immediate needs, and it is repaid with tax revenues.
The county also will have to make its final three payrolls — totaling nearly $4 million — and pay about $680,000 for health care.
The county already has decided to hold off its final, $1.25 million payment of the year to the Butler County Community College until January.
The commissioners in November voted to allow the withdrawal of up to $1 million from the county’s reserve fund, which totals $1.2 million.
Additionally, the county has $1.9 million in state Act 13 Marcellus Shale gas impact fee money that is not allocated for any specific purpose that can be used for general fund payments. It also is expecting internal warrants — which includes money generated by county departments’ fees and money the county routinely advances to departments that is paid back — totaling about $1.6 million by the end of the year.
Commissioner Bill McCarrier, board chairman, said freezing purchase orders should help the county get through the year.
“I do think it’s a good idea. We have to tighten up here,” McCarrier said.
Without state money coming in, McCarrier said the county has to find places to get any extra money it can. He also noted that due to the way this year’s calendar is set up, the county has 27 payrolls as opposed to 26 — which adds up to an extra $1.3 million the county needs to pay.
Controller Ben Holland, who told commissioners in June that he predicted a deficit by the end of the year, said he does not think the move will make a big difference. He said actions like this should have been done months ago.
“They should have taken these actions then,” Holland said.
He said the move is “a little too late.”
