Three Richland County Council members in favor of alternative budget
One council member asked County Administrator Leonardo Brown to redo the budget before the end of the month.
Three Richland County Council members said they favored a budget that did not involve a substantial millage rate increase and wanted county administration to look for funds elsewhere to balance the budget.
In fact, on June 5 one council member made to completely start over with the budget process and asked County Administrator Leonardo Brown to bring back a balanced budget that did not include a hike in millage rates.
Catch up on what’s been going on:
Ultimately, his motion failed to pass and did not get enough support from his fellow council members.
Richland County has dug themselves in a hole due to past overspending. A look back at Annual Comprehensive Financial Report for the fiscal year ended June 30, 2024, shows that the county spent at least $7 million out of the unassigned fund balance to cover deficits in the budget.
Last year, the ACFR said that unassigned funds were used to cover funds from special revenue and capital projects.
Assistant County Administrator Lori Thomas told council in May that they would need to pause transferring any funds from the unassigned fund balance in the 2025-2026 budget in order for the county to keep a good credit score to borrow on. This creates a problem, however, because county administrator has been relying on this fund — which is essentially supposed to be an emergency fund — to balance their budget.
State law requires that Thomas present a balanced budget to council, which comes with these difficulties. It’s dangerous that the county has been continuously using funds from unassigned to cover costs because those are non-reoccurring funds, and could point to bigger financial issues with how the county structures their budget.
Former Budget Director Maddison Wilkerson told council in a May 13 presentation to council that they had been overspending on a category called “professional services,” — which has been used to fund legal fees and other contracts. This budget code is notably absent from Richland County budget documents.
I brought up my concerns with council on the lack of information on their professional services spending when I spoke before council at the budget public hearing.
County administration said overspending from the unassigned fund balance is the driving reason for them to recommend an increase in millage rates. County Auditor Paul Brawley said the county need $15 million in additional revenue to balance the budget.
Council argues over millage rates
During the June 5 second reading of the county’s budget, Council members Jason Branham, Don Weaver and Gretchen Barron expressed that they were not on board with county administration’s plan to increase the millage above the cap.
The “no-mil” budget was the theme of the night — which was what Branham and Weaver called a budget that did not include a millage rate increase. Things got tense at the council meeting that night and council had to take a 15-minute break when tensions got too high.
Both Branham and Barron had proposed their own motions during the second budget reading to encourage county administrator to look for funds to balance the budget elsewhere.
Branham’s proposal would have the budget process restart altogether, which Council Chair Jesica Mackey was not happy about.
Branham’s proposal would mean that county administration would have to redo the entire budget book — and post a new or revised budget book (something which I asked for at the budget public hearing in May due to how much information was missing).
The reason Branham doesn’t want to increase the mil is because of inflationary pressures affecting Richland County residents.
“As much as I think that a lot of the things that government wants to do that are good and noble, we just can’t do them right now,” he said.
Council Chair Jesica Mackey said that Branham would need to give guidance to county administration on how to shape the new budget; Branham responded by saying he spoke to County Attorney Patrick Wright and the law does not require him to provide county administration with any guidance to make a motion.
(Watch their exchange below at the linked timecode. )
Mackey responded by saying: “You’re right, it is not illegal, but as this body stays, I think it would be beneficial if you’re making such motion, and this administrator and staff has spent as much time as they have to prepare this for us in helping and aiding in your motion, it would be helpful if you could provide clear direction so as that we could get to our timeline that we need to, and meet the budget on time, instead of the administrator guessing on what it is that you might want fulfilled and not fulfilled.”
Mackey says that she worries that Branham would send County Administrator Leonardo Brown off on an “aimless mission,” with his motion to amend the budget without clear priorities.
By contrast, Barron said her motion was to hopefully bring council to a compromise without stepping on Brown’s toes.
“I would like to see options versus saying, ‘Here’s a 5 mil, this is the only way we can do it,’” Barron said.
Perhaps most shocking of the night: A millage rate increase that would fund Richland Library passed by thin margins— with Council members Tyra Little and Tish Alleyne joining Branham, Barron and Weaver.
“I like a lot of the people at the library … a lot of the people that work there. I like a lot of the objectives of the library,” Branham said. “But that’s a really big number when you look at the non-school districts that are millage agencies in Rich land County. They are nearly double the Recreation Commission which is the next closest, so, I am not in favor of going beyond the no-mil budget.”
Councilwoman Chakisse Newton was the deciding vote in favor of the increase.
Achieving a ‘balanced budget’
State law requires that county administration present a balanced budget. However, this budget may not be the most “financially sustainable,” according to the Government Finance Officers Association.
Here’s what that professional finance organization has to say:
“Most state and local governments are subject to a requirement to pass a balanced budget. However, a budget that may fit the statutory definition of a "balanced budget" may not, in fact, be financially sustainable. For example, a budget that is balanced by such standards could include the use of non-recurring resources, such as asset sales or reserves, to fund ongoing expenditures, and thus not be in structural balance. A true structurally balanced budget is one that supports financial sustainability for multiple years into the future. A government needs to make sure that it is aware of the distinction between satisfying the statutory definition and achieving a true structurally balanced budget
….
For a variety of reasons, true structural balance may not be possible for a government at a given time. In such a case, using reserves to balance the budget may be considered but only in the context of a plan to return to structural balance, replenish fund balance, and ultimately remediate the negative impacts of any other short-term balancing actions that may be taken. Further, the plan should be clear about the time period over which returning to structural balance, replenishing reserves, and remediating the negative impacts of balancing actions are to occur.”
If government organizations consistently rely on non-reoccurring funds, which could be unassigned funds or grants, then they are considered structural imbalanced.
Could that be what’s happening in Richland County? What is their long-term plan to make sure they are financially and structurally sound?
Final budget reading
The final and third reading of the budget is expected on Tuesday, June 17.