&dquo;Polk County has a very good fund balance. It&squo;s good we have had an excess the past few years,&dquo; says Whitson. &dquo;But I don&squo;t think we&squo;re going to have excess funds at the end of this fiscal year. I&squo;m hoping to break even.&dquo;

The county&squo;s fund balance has risen dramatically over the past several years as the county took steps to recover from a financial crisis in 2000, and property tax revenue jumped during a wave of development.

In 2000, the county&squo;s fund balance dropped to just $90,598, or 0.7 percent of general fund expenditures. Spending on construction of the Womack Building and renovation of the historic courthouse contributed to the low fund balance, along with a $520,000 accounting error that led the county to believe it had more money than it had.

The Local Government Commission (LGC), which requires a fund balance of 8 percent, or enough to cover one month of expenditures, sent Polk County a letter of reprimand. LGC urged the county to rebuild the fund balance promptly or face state government intervention.

The county quickly took steps to rebuild the fund balance, cutting spending and raising property taxes by 9.3 cents per $100 of property valuation in the next fiscal year.

The fund balance jumped to $2.1 million in 2001 and has increased every year since then.

Last year the county added $402,857 to its reserves even though it used some money to pay for new courthouse renovation work and an addition at Sunny View school.

In the current fiscal year, the county is planning again to tap its reserves, this time for the purchase of Lake Adger and new water lines in the Green Creek area. The county has agreed to purchase Lake Adger, which will become the county&squo;s primary water source, for $1.6 million. The county also has estimated it will spend about $1 million for water line extensions in the eastern part of the county.

Unlike in previous fiscal years, however, the county is not likely to fully replenish those funds with another rise in property tax revenue. The slumping economy has stalled revenue growth.

As a result, Polk County Manager Whitson is forecasting the county will end this fiscal year with a fund balance of close to $5 million, or about 21 percent of general fund expenditures.

While that&squo;s well above the required 8 percent minimum, it will put the fund balance at the lowest level it&39;s been since 2002, as a percent of expenditures. Over the past several years the county&squo;s fund balance has ranged from 25 to 35 percent.

Whitson says he would like to keep the fund balance between 20 to 25 percent. He says a fund balance below 15 percent is &dquo;getting into the danger zone.&dquo;

&dquo;I feel comfortable with where we&squo;re at, but I&squo;m keeping a close eye on the budget,&dquo; says Whitson.

Polk&squo;s fund balance has been a source of debate among citizens and even commissioners in recent years. Some fiscal watchdogs have said the county has been keeping too much in reserve, and should return the surpluses in the form of a property tax cut. Others have said the county needs a substantial reserve so it has funds to cover large, unexpected expenses and weather financial downturns.