Remember all of the discussions by the justices of the peace in Benton County about how they were going to use the county’s share of the half-percent state sales tax increase to speed up improving roads in Benton County and how wonderful it would be to get more county roads paved? Well, it appears from the current decisions that they have moved on and will probably use some of those funds to pay for ambulance service in the unincorporated area of the county. Benton County’s share of the tax was estimated at $1,288,884 per year. Last year they didn’t pave many roads “because of spring fl ooding and personnel issues in the road department” and this year they plan on cutting the road department budget by $450,000 to fund the ambulance services in unincorporated Benton County. This is just not acceptable! That’s not what the voters expected when they voted for the sales tax increase to improve roads. Also, according to an article on the Association of Arkansas Counties website, it appears the attorney general may consider this transfer illegal.
“Since county General Funds are transferred to other county funds to supplement the operations of particular county funds, such as the Road & Bridge Fund, is (it) legal to transfer road and bridge funds or money from other county funds to county general to supplement general operations?”
The general answer to the question is “no” — but there are some exceptions to the rule, according to the opinion. There is no state law that specifically says you can transfer from general to road, but not vice versa. The law is “unwritten” and is a conclusion of deductive reasoning using the laws written concerning county government accounting practices, attorney general opinions and case law.
The premise is this: The county General Fund is made up of unrestricted revenue of the county. General revenues of the county can be spent for any legal expenditure of the county. Therefore, general funds can be transferred to the Road and Bridge Fund or any other fund of the county and spent for whatever purpose the receiving fund is established for.
However, the Road Fund and many other funds on the books of the county are “Special Revenue” funds, restricted use funds. They are used to account for the proceeds of specifi c revenue sources that are legally restricted to expenditures for specific purposes. It is my contention based on my research that even general funds transferred to a special revenue fund take on the persona and expenditure restrictions of that fund. Therefore, “special” or “restricted” revenue funds cannot, as a general rule, be transferred to the county General Fund for general purpose expenditures.
DAVE FREEMAN
Garfi eld