Andrews – Officials hope progress made over the past three and half years will result in the town being removed from the state’s list of financially struggling units.
Andrews was placed on the state’s unit assistance list during the 2017-18 fiscal year partly due to dubious spending and unconventional budgeting techniques on the part of the former administration. At the conclusion of that fiscal year, state officials noted that Andrews’ internal controls and water/sewer fund ranked “high” on a risk assessment scale, while the town’s general fund was in a state of “moderate” risk.
At the conclusion of the 2019-20 fiscal year, state officials noted that the town’s internal controls remained high risk; however, the general fund had improved to a “low” risk ranking, and the water/sewer fund had improved to a state of “moderate” risk.
Last year, state officials encouraged Andrews’ personnel to comply with the town’s bill collection and enforcement policy, while monitoring its water/sewer rates on an annual basis to ensure they are sufficient to cover the cost of providing the service. Town officials say a decrease in collections was caused by the pandemic, which adversely affected utility customers who in turn were allowed to delay payment per state regulations.
“We have set up payment plans for the customers of Andrews Water & Sewer in order for customers to recover from the COVID set back,” Town Administrator Sandy Dobson said via email, explaining progress the town has made since then. “We have also, as suggested by the Local Government Commission, implemented a cutoff policy for late accounts [that had not set up] a payment plan.”
Dobson said the town is also monitoring water and sewer costs in hopes of avoiding a rate increase.
“One of the ways we are doing this is by seeking grants for major repairs versus funding from current operating income,” she said.
Meanwhile, town officials say the issues that resulted in a “high” risk assessment in the internal controls category were caused by employee turnover at the finance officer and tax collector positions. The issues have been corrected.
The town has until Oct. 31 to submit the audit for the 2020-21 fiscal year. Local officials are optimistic it will show enough improvement to shift Andrews into the low-risk category for all measures.
“According to everything I’m hearing, I think so,” Mayor James Reid said when asked if he believes the town will soon be removed from the state’s unit assistance list. “It looks good. Our finances are the best they have been since 2013.”
The LGC removed 38 government entities from the list earlier this year; however, nearly 160 units of government are still on it.
“It's our responsibility to make sure that we scrub these,” State Treasurer Dale Folwell said. “We need to make sure that there are examples out there for cities who are maybe in the first or second inning of uncertainty of financial viability. We need for them to be able to look to other people who are in the eighth and ninth inning of some of these issues who've actually had the discipline to make the tough choices to get through it.”
Meanwhile, legislation signed into law by Gov. Roy Cooper on Aug. 30 will allow the LGC to take additional steps to help distressed units.
Senate Bill 314, dubbed The Local Government Commission Toolkit, creates a process that allows the LGC to dissolve municipalities and transfer their liabilities, assets and other obligations. It gives the LGC authority to mandate special training for officials from struggling units. It also requires a statement from the LGC be included in a petition to the General Assembly in plans for new municipalities.
"This toolkit was developed in an effort to make sure that when we did need a tool that we statutorily have the tool to do the job," Folwell said.
Nyamekye Daniel of The Center Square contributed to this report.