July 1 marked the start of a new fiscal year for North Carolina local governments and with that, we began the first fiscal year for which our localities will be subject to Statement 77 from the Governmental Accounting Standards Board, which is entitled Tax Abatement Disclosures.

A flare-up over proposed legislation (Senate Bill 554) to increase school leasing projects highlights a scenario playing out all over North Carolina – counties outside the 40-85 crescent face shifting, or declining, school populations, along with older schools in need of substantial renovation or replacement. The legislation is associated with a proposed program to replace and repair schools across Robeson County at a price tag estimated at $1.4 billion, although it would authorize a financing technique that would be available across the state.

For several years the lending and investing community has been expressing concerns about how and when local governments provide disclosure to that community about non-rated government bank loans and other private financings. 

What do we need all this fund balance for, anyway? As we move into the height of budget season for North Carolina local governments, this question will ring out from voices across the State—especially as many local governments re-build fund balance after some years of...

—What do we need all this fund balance for, anyway?—

As we move into the height of budget season for North Carolina local governments, this question will ring out from voices across the State—especially as many local governments re-build fund balance after some years of decline. So, why do we keep taxpayers’ money in the government’s bank account (if in fact, that’s how you view the issue)?

Unrestricted fund balance does more than dress up local governments’ financial statements and keep the Local Government Commission happy. Fund balance provides important cash flow coverage, allows local governments the flexibility to cover unexpected costs, and positions local governments to take advantage of unexpected opportunities.

Spring is in the air, making April a great month to carry out the legal housekeeping for your local nonprofits and authorities.

When a new governor or president takes office, newspaper columns and the blogosphere are full of unsolicited advice for how the new person in charge, and that person’s team, can make things better. Perhaps the appointment of Greg Gaskins as the new Deputy Treasurer and Secretary to the Local Government Commission doesn’t have quite the same cache as installing a president or governor, but with the change at the LGC, naturally we thought we’d offer a few bits of completely unsolicited advice for how the LGC and its staff could make life better for the Commission’s constituents (and North Carolina public finance in general) without new legislation and (at least as it seems to us) without undue burden on staff or resources.

We think of “two-thirds bonds” as the “unsung heroes” of North Carolina public finance. Two-thirds bonds are a type of general obligation bond that doesn’t require voter approval. They are an underutilized funding resource.