Magistrates unanimously voted to borrow $500,000 from First Guaranty Bank in a resolution declaring an “emergency situation” in regard to the county's finances.
Judge-Executive R.D. “Doc” Marshall downplayed the language of the resolution, saying the loan was merely to help the county get by during the first few months of the fiscal year, which begins today, when funds are short.
“In fact, if anything, we're a little better off than this time last year,” Marshall said.
But District 2 Magistrate Jackie Edford Owens had a gloomier outlook in regard to the county's financial situation, saying there is no money for road materials and predicting the county could soon find itself hard-pressed to meet its payroll.
“They're broke,” Owens said. “The county is broke.”
Marshall said that while the county would have a hard time meeting an unexpected large bill, the county is still ending the year with between $100,000 and $200,000 and now will have the loan passed Friday to get by in the event of any unexpected expenses.
Marshall said the fiscal court needs to address spending cuts to get on more solid financial ground, but ruled out any need to raise revenue through new or higher taxes.
“It's not a crisis,” Marshall said. “Let's just put it this way - it's been worse.”
The loan was just one of several financial items addressed during Friday's meeting. In another, the court declined an offer from County Attorney Keith Bartley to reduce his salary by $5,000 in an effort to help the county through its lean financial times.
“I think that's very good of him to do that,” Owens said. “But, like I told him the other day, the financial situation of the county did not come about become of the county attorney.”
Owens then reluctantly made a motion to adopt the resolution, but the measure died when no one else seconded the motion.
The court also narrowly approved changing its bank from First Guaranty Bank to Community Trust Bank, but not without heated debate.
Marshall proposed making the change, based on Community Trust's offer to pay 4.25 percent interest on county deposits, compared to the 1.5 percent rate the county has been getting from First Guaranty. Marshall said the reason for the change was “strictly economics,” noting the county would realize about $27,000 in additional revenue through the higher rate.
Owens, however, vocally opposed making the switch, saying he would prefer to do business with First Guaranty because it is based in Floyd County and has been helpful to the fiscal court in the past.
“I can't see switching bank accounts from someone who has been so good to us in the past,” Owens said.
Community Trust Bank is based in Pike County.
When it came time for a vote, District 1 Magistrate John Goble and District 3 Magistrate Donnie Daniels voted in favor of making the change, while Owens and District 4 Magistrate Ronnie Akers voted against it. The measure passed when Marshall cast a tie-breaking vote in favor of the change.