Indictment supports county's move to financial management

The indictment last week of a former county official on embezzlement charges seems like a vindication of the county's decision, two years ago this month, to place itself under Tennessee's Financial Management Act of 1981.

Prior to 2006, the county's finances were a hodgepodge. Some individual offices handled their own payroll and purchasing and there was much less central control. Every year, state auditors would point to this fact in the county's annual audit report and recommend that the county adopt financial management.

When the County Commission opted in to the 1981 act, not long after the August 2006 election of County Mayor Eugene Ray, it created the office of finance director. Robert Daniel, who had already been the business manager for the biggest single part of the county budget, the school system, was hired for the new finance director position. What had been the county commission's budget and finance committee became the county financial management committee. It was expanded to include the school superintendent, the county mayor and the highway superintendent as members.

Daniel and Ray worked with various county officials, not all of whom were enthusiastic about the change, to bring them into compliance with the new centralized system.

Last week's indictments were based on financial records from 2003, prior to the adoption of centralized financial management, through 2007, which is around the time new policies and procedures were being put into place. Officials say that it was Daniel who brought irregularities to the attention of the state comptroller's office, which led to the indictments. One wonders how long such a situation might have continued without someone in Daniel's position having access to those records and the power to do something about them.

But that's far from the only impact of the new system. In a time of economic stress, when the county's tax revenue is lagging and every penny of income and expense is a topic for scrutiny and discussion, county commissioners (not to mention observers like you and me) now have much better information at hand about where the county stands each month, and when they have additional questions they know exactly where to turn for answers.

The county can now more easily use its combined purchasing power to save money on things like fuel and supplies.

The financial management system is still relatively young, but it has already provided benefits to the county and its taxpayers. Some people are justifiably skeptical about any new level of control or bureaucracy, but in this specific case I believe it has paid off.

-- John I. Carney is city editor of the Times-Gazette and covers county government and other topics. His home page is lakeneuron.com.