06-07-2011 Work SessionWORK SESSION OF THE ISLE OF WIGHT COUNTY BOARD OF
SUPERVISORS HELD THE SEVENTH DAY OF JUNE IN THE YEAR
TWO THOUSAND AND ELEVEN
PRESENT: Thomas J. Wright, III, Chairman
Stan D. Clark, Vice- Chairman
Al Casteen
JoAnn W. Hall
Kenneth M. Bunch
Also Attending: A. Paul Burton, Interim County Attorney
W. Douglas Caskey, County Administrator
Carey Mills Storm, Clerk
Chairman Wright called the meeting to order at 3:00 p.m. for the
purpose of conducting a work session on the Governmental Accounting
Standards Board Statement Number 54 Fund Balance Reporting and
Governmental Fund Type Definition (GASB No. 54).
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Supervisor Casteen delivered the invocation.
The Pledge of Allegiance was conducted.
Chairman Wright called for approval of the agenda.
Supervisor Casteen moved that the agenda be approved. The motion
was adopted by a vote of (5 -0) with Supervisors Bunch, Casteen, Clark, Hall
and Wright voting in favor of the motion and no Supervisors voting against
the motion.
Michael W. Terry, Director of Budget and Finance, advised the Board
that the Governmental Accounting Standards Board Statement Number 54
Fund Balance Reporting and Governmental Fund Type Definition (GASB
No. 54) is simply a reclassification for accounting purposes relative to fund
balance and reporting. He advised that staff is currently undergoing
accounting and legal research by which a set of policies or procedures will be
produced for consideration by the Board at its June 16, 2011 meeting.
Mark C. Popovich, Assistant County Attorney, advised the Board that
its approval will be necessary with respect to where funds are to be placed in
the new five (5) separate fund categories.
Jack Georger, Certified Public Accountant, briefed the Board relative
to the GASB No. 54 implementation process and an overview was provided
with respect to how GASB No. 54 will affect the County and the School
Board. He advised that GASB No. 54 will only apply to the General Fund,
Capital Projects Fund and Special Revenue Funds for the County and will not
impact the Public Utilities or Fiduciary Funds. He advised with respect to the
School Board, GASB No. 54 will only affect the Operating Fund, Text Books
Fund, Capital Projects and Cafeteria Funds and will not affect Proprietary or
Fiduciary Funds. He advised that the School Board must follow the same
constraints in GASB No. 54 as the County. He advised that components of
the County's Fund Balance have been analyzed. He advised that revenues in
various funds were then analyzed for any legal restraints, as well as Federal
and State grants and revenues to determine their specific purposes only,
which determines where funds will be classified in the Fund Balance. He
stated research has been conducted to determine if any resolutions were
previously adopted by the Board designating revenue with a particular
source. He advised that the County's 2010 Financial Statement balances
were then mapped to a new definition or classification. He advised that the
new fund type definitions are applied to the County's existing funds. He
advised that new definitions include General, Special Revenue, Capital
Project and Permanent Trust Funds. He advised that the next step is the
implementation work session which is being held tonight. He advised the
Board should anticipate consideration of a resolution at its last meeting in
2011 to conform the Financial Statements of the County to GASB No. 54.
He stated that the Director of Budget and Finance has previously reviewed
with the Board the new GASB No. 54 categories of Non - spendable,
Restricted, Committed, Assigned and Unassigned. He advised that current
classifications under the General Fund are Unreserved Designated,
Encumbrances, Chesapeake Bay Violations, Grants and VDOT Revenue
Sharing and Unreserved/Undesignated. He stated certain policies and
procedures under GASB No. 54 will require the Board and the Assistant
County Attorney to determine the County's highest level decision - making
authority and what formal action will need to be taken. He stated the Board
will also need to determine if there are other levels of authority wanted to
assign specific portions of the fund balance for specific situations, such as
emergency funds to set aside for disaster preparedness. He stated the Board
must establish by resolution the County's spending policy and what project
will be expended first before going to the Fund Balance and any
unappropriated monies. He advised that if a resolution is not adopted, GASB
No. 54 contains a default specifying that the spending policy is to use
Restricted funds before Unrestricted and use Committed/Assigned before
Unassigned. He advised there are open issues about classification for
proffers, Chesapeake Bay violations and 911 revenue.
Mr. Terry advised that staff would prepare the necessary draft
documents for the Board's review. He further advised that he has met with
the Director of General Services to discuss VDOT designations and Mr.
Wrightson is currently researching any funds that need to be shown on the
books that are being held by VDOT. He advised that he is also reviewing
whether or not to show VDOT funds as Committed or as Unassigned.
Assistant County Attorney Popovich recommended placing any funds
previously designated in the Unassigned Fund. He stated what is presented
to the Board at its next meeting is staff's best estimate as to what funds
should be placed in what category and staff will need the Board's approval
before it moves forward with committing those funds.
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Supervisor Hall moved that the Board adjourn its work session at 4:00
p.m. The motion was adopted by a vote of (5 -0) with Supervisors Bunch,
Casteen, Clark, Hall and Wright voting in favor of the motion and no
Supervisors voting against the motion.
arey ills Sto , Clerk
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