RIO GRANDE CITY — Starr County will be taking out loan in order to keep the county running until the end of the fiscal year.
RIO GRANDE CITY — Starr County will be taking out loan in order to keep the county running until the end of the fiscal year.
The commissioners agreed to take out a $1.5 million loan from Lone Star National Bank. The loan is structured like a line of credit, said County Judge Eloy Vera who was authorized to withdraw funds as needed.
The decision comes as interim County Auditor Boyd Carter reported that the county has a projected general fund balance of -$1,654,000. Carter delivered a breakdown of the county’s finances during a commissioners court meeting July 10.
The negative fund balance was a result of expenditures that exceeded the revenues in both the Road and Bridge Fund and in the General Fund.
As of July 7, revenues for the Road and Bridge fund amounted to $5,078,000 with a total projected revenue of $5,503,000 through the end of the fiscal year.
The total projected expenditures through the end of the year amount to $5,654,000, which gives them a projected budget deficit of $151,000.
The county already began the fiscal year with a deficit of $1,003,000 which, together with the projected deficit, equals a total of $1,154,000 in the Road and Bridge Fund.
As for the general fund, Carter said the total projected revenues totaled $16,777,000 while their total projected expenditures were $17,726,000, resulting in a deficit of $949,000.
However, the county has a current balance of $298,000, which brings the current cash available to -$651,000. The existing deficit in the Road and Bridge Fund of $1,003,000 was also calculated in the General Fund to arrive at the -$1,654,000 projected balance.
The shortfall, Vera explained, was in part due to the closure of eight-liner game rooms. The county decided to stop issuing permits for the eight-liner machines earlier this year which were expected to bring in about $800,000 for the county. Because the county only collected permit fees for the first quarter of the year, the county was $600,000 short.
Another reason for the shortfall was a disagreement over abatements with Duke Energy Renewables, an energy company that constructed wind farms in the county.
News of the county’s continued financial struggles comes as commissioners learned the county’s audit report was not completed by the June 30 deadline, which was needed to apply for federal and state grants.
The county was denied an extension to submit the report for Community Development Block Grants for which they will be unable to apply for two years. CDBG grants are meant to fund projects that benefit low-to-moderate income residents.
Carter was quickly appointed in May to complete the audit after the district court judges chose to not renew the contract of the previous auditor.
Vera noted the county was owed payment of about half a million dollars from Duke Energy. He said he met with Duke representatives who assured him payment would be coming soon.
