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TN: Comptroller says county debt increasing, revenue decreasing

By   /   November 27, 2012  /   No Comments

By Christopher Butler | Tennessee Watchdog

IN AN OUT: Tennessee counties are spending more money than they take in.

NASHVILLE — County and local officials throughout Tennessee will have to find a way to fund more government services with less taxpayer money in the near future, according to a new report from the state Comptroller’s Office.

In many instances, these county officials do not have the option of making budget cuts in services such as education, health, and public safety — that is because state and federal officials mandate that they provide such services. This happens at the same time demand for these services are on the rise, according to State Comptroller Justin Wilson.

In a new report that focuses on the current financial condition of county governments, Wilson said county officials throughout Tennessee ran up a combined deficit of approximately $490 million during the most recent fiscal year.

Meanwhile, total county-related debt in Tennessee increased $1.4 billion between 2007 and 2011 — even as county officials continue to put off their responsibilities toward paying their debts.

“This debt indicates that many county governments are deferring debt principal payments and other obligations to future years,” Wilson wrote.

Many of these counties received federal stimulus money in 2009.

Making matters worse, health insurance premiums and other liabilities are growing for employees who have already left public service.

“In addition, new accounting standards will require the recognition of significant long-term pension costs. These costs, which previously have not been recorded on the financial statements when they were incurred, will dramatically impact large and small governments alike.”

Furthermore, many county governments do not have staff members who know how to properly handle such complicated financial issues, Wilson wrote.

Christopher Butler is the editor of Tennessee Watchdog and the director of government accountability for the Beacon Center of Tennessee. Contact him at chris@beacontn.org

 

 

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