Nelson Passes Financial Management Policy

Aside from all the media hoopla over its Family Protection Ordinance, Nelson City Council addressed other items this week at its regular meeting Monday night. Approval of a financial management policy was one of these items. Introduced previously, the policy addresses issues such as methods of budgeting and certain city budgetary requirements.

According to Part B of Section II of the policy, the city is required to have a balanced budget:

“The budget shall be balanced for each budgeted fund. Total anticipated revenues plus that portion of fund balance in excess of authorized reserves (see operating budget policy F below) that is designated as a budget-funding source shall equal total estimated expenditures for each fund.”

Subsection E under that same Section discusses stabilization resources:

“The City shall establish a fund balance reserve in all operating funds (defined in Section I of this policy) for working capital. The purpose of working capital is to cover the cost of expenditures caused by unforeseen emergencies, cover shortfalls caused by revenue declines, and to eliminate any short-term borrowing for cash flow purposes. This reserve shall accumulate and then be maintained at an amount, which represents no less than two (2) months of operating and debt expenditures (approximately 16% of budgeted expenditures).”

In the last few years, Nelson has struggled with cutting its budget and maintaining a sufficient reserves fund. Council saw the passage of this policy as a step in the right direction. Mayor Mike Haviland also thought it a positive measure.

“It’s an infrastructure we really didn’t (previously) have in place,”

he said, but admitted,

“It’s not the answer to everything but it’s a good first step.”

City Clerk and Manager Brandy Edwards also gave an update on the Park Bond Project. Last summer, in late July-early August, Cherokee County approached the city regarding a park bond project. Half of Nelson resides in Pickens while the other half resides in Cherokee. As such, the city was eligible to receive $200,000 (with a $50,000 cushion) worth of bond money provided for by Cherokee County free of charge. According to Cherokee Recreation and Parks Director Bryan Reynolds, the bond was approved by voters in November 2008. The money is intended to cover design and construction. Reynolds says the fund allocation to Nelson is part of the “Three Cities Project,” which includes Nelson, Ball Ground and Waleska. Since this time, council has gone back and forth with Cherokee concerning various issues. During Monday’s meeting, however, Edwards reported progress with the project. Edwards said she and council woman Edith Portillo recently met with representatives from Cherokee County to discuss the park bond project. She said the project is currently on budget and is expected to go out for bid in June.