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City's strong reserves are enough to eliminate annual tax note

By Jim Fair, Editor
Published on Tuesday, December 23, 2014

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'Our cash position is strong enough this year we haven’t needed to borrow money to pay our bills.'
City Administrator Ed Driggers 
 

'Our cash position is strong enough this year we haven’t needed to borrow money to pay our bills.'

City Administrator Ed Driggers 

 

There’s good news from the Greer city finance team.

The city will not have to borrow for a tax anticipation note (TAN) for the first time in City Administrator Ed Driggers’ tenure in Greer.

David Seifert, director of the city’s finance department announced, to City Council at its last meeting, the extraordinary financial position during the city’s annual audit review.

Driggers explained the tax anticipation note for the city. “It’s exactly what it sounds like, we borrow money in anticipation of our taxes coming in,” he said. “That last quarter of the year is when we get the tightest on cash.”

The city’s $19.7 million 2014-2015 fiscal year budget means about $5 million would have to be borrowed for a TAN, if not for reserves. The city, annually, tries to keep about 35 percent, 3-4 months of its budget, in reserves for operating cash.

Driggers said historically, “It looks like for the past 20 years we’ve needed to borrow money in the fourth quarter of the year.

“Our cash position is strong enough this year we haven’t needed to borrow money to pay our bills,” Driggers said. “That is where we are right now, and that’s because we’ve been putting money into our reserves and our reserves enable us to not have to borrow money when it’s the leanest (October, November, December).

Driggers said the city gets huge cash infusion from the county treasurers (Greenville and Spartanburg) from people who pay their taxes by Dec. 31.

Eliminating the TAN has been a long-term goal for Driggers. “We set financial goals and one of our goals in our strategic plan is to position ourselves to not need to issue a tax anticipation note.”

 

 

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