COVINGTON, Ga. — Newton County government’s chief auditor praised elected and appointed officials Tuesday for doing a “commendable” job to stabilize finances in the past five years — including growing its reserves to a level eight times larger than in 2016.
Miller Edwards of the accounting firm Mauldin & Jenkins said he had seen “a lot of improvement” in such areas as the county government’s financial stability in the five years he had reviewed the audit of the county’s financial procedures.
“It’s good for you to hear from us that we’ve seen such improvement,” he said.
Edwards spoke during his presentation of the audit of the county government’s finances during the 2021 budget year.
He noted the county budget’s General Fund had $5 million in its reserves in 2016 but increased that amount to $40 million by the 2021 budget year that ended June 30, 2021.
It increased $17 million in one year between 2020 and 2021, Edwards said.
Auditors generally advise governments to have at least six months of operating capital in their reserves in case of budgetary emergencies such as revenue being diverted for some reason.
Edwards said a $40 million fund balance gives the county seven months of operating capital — compared to 2016 when its reserves would only give it less than a month's worth.
He noted he first began auditing the Newton County government in 2016 when it was using deficit spending to operate.
“You were tight back then,” he said.
In the latest audit of the 2021 budget year, the county had assets worth $400 million compared to liabilities totaling $100 million — giving it $300 million in equity.
“If I had a balance sheet like that, I’d be pretty happy,” Edwards said.
The audit document stated the firm did not find any “material weaknesses” — defined as an organization’s ineffective internal controls which cannot prevent irregularities in financial statements.
However, he said one of the few recommendations in the document was adding more money to its pension fund.
Only county employees hired prior to 1995 are on the plan, said Finance Director Brittany White. It includes 20 active employees and 130 retired employees who are receiving benefits, she said.
Edwards said the plan is funded at 65% and the “best plans” are funded at least 85%.
“You won’t make it the next generation’s problem,” he said.
District 4 Commissioner J.C. Edwards said he wanted to consider adding more employees to the pension program. Chairman Marcello Banes said he planned to present such a plan to the Board as part of the 2023 budget process.
Former county manager Lloyd Kerr was responsible for working with White and her predecessors annually since 2016 to compile and present the annual budgets to Board members before they made their own changes and approved them.
The budget's General Fund increased from $69.0 million in 2019 to $76.2 million in 2021 while increasing its reserves and rolling back its property tax rate in 2022.
Commissioners openly praised White for the audit findings.
District 5 Commissioner Ronnie Cowan said Tuesday the audit showed the county is "in good financial shape."
"Y'all remember about five years ago — we were broke," Cowan said. "I think it's indicative that we toed the line on some tough decisions.
"We've not always agreed on things," Cowan told commissioners. "In the long run, we've come out on top so the county's in good financial shape."
District 1 Commissioner Stan Edwards said, “Five years ago when I came into office there was ($5 million) in the fund balance and we were struggling to make things work financially."
“Fiscal conservatism through a culture change, common sense approaches and solutions has helped moved us to where we are now financially,” Stan Edwards said. “County employees adopted this culture as well and they are responsible, primarily, for our financial status as a county.
The Board’s challenge in upcoming months and years "will be to resist the temptation of ‘blowing’ our savings (and) returning us to a tenuous financial scenario,” he said.
