BOCC dips into fund balance for charitable trust

Charles County, like most other jurisdictions nationwide, sometimes has to dip into its fund balance to supplement costs when certain needs come up during a fiscal year. This is not an uncommon occurrence and has happened in Charles County before.

But when the county’s fiscal team recommended the board of county commissioners move $191,900 from the county’s fund balance within its general fund to fund the county’s charitable trust program starting in September and to cover the costs for a county consultant, things became contentious between the officials.

The county’s approved amendment for this fund transfer would go on the fiscal year 2017 budget, according to Jennifer Ellin, the county’s chief of budget.

Overall, according to documents provided by county staff, $176,300 of the county’s $191,900 transfer would go to administrative positions and requirements such as office space, insurance and professional services for the county’s Charitable Trust program.

Ellin said she does not know if these same costs will occur annually after the 2017 fiscal year. But there are not any projected figures at the moment, she said.

“Our hope was that it could be less each time as the organization gets up and running,” Ellin said.

Commissioners’ Vice President Debra Davis (D) said that while she sees the benefit of the county’s Charitable Trust program, she does not feel comfortable transferring so much spendable money to the program for administrative positions going forward.

There are “big issues,” Davis said, with taking 25 percent of what the county actually grants to charitable organizations. The county grants $800,000 to charities every year, she said, and this is not what the money was meant for.

“That is unacceptable. The vision for this was not to spend $200,000 on administration out of $800,000 worth of grants,” Davis said. “The idea that we need $100,000 for a CEO, I don’t even know where to start.”

This is not proper use of taxpayer dollars, Davis said. The $190,300 could be used in the community somewhere rather than being put into the organization’s administration.

When the county approved the $800,000 in grant money for charity, Davis said, they discussed putting limits on how much could be spent on administrative costs.

“I think we need to go back to the drawing board,” Davis said.

Vivian Mills, a consultant for the Charles County Charitable Trust organization, said the vision of the county was to set up a nonprofit organization that will serve and aid other smaller nonprofit organizations within Charles County. The trust will be in a “prime position” to deliver services to those other organizations, she said, and make them more effective.

This will not all happen in one year, Mills said, and it will take strategic planning over a five year time frame to get done. But the organization does plan to absorb more of its budgetary needs as it continues to grow.

“The Charles County Charitable Trust will have a very strong commitment to bringing in other sources of funds to make this program really work and replace the county moneys,” Mills said. “The current budget in front of you, I would encourage everyone to look at it as our startup money.”

Mills said promoting the development of a new nonprofit entity and not having it funded sufficiently would be “sad.” The company needs to get a start and as it moves forward, she said, costs will dwindle down.

Commissioner Ken Robinson (D) said having this organization is “really, really important” and the ability to grow the organizations funding resources will continue to bring the funds down.

“Let’s also realize that up to this point there have been administrative costs. There have been county staff that have been working on this,” Robinson said. “I don’t know if we have a breakdown of how much hours and money have been spent on this, but it’s not insignificant.”

There is no current breakdown of how many hours county staff has spent working on developing the Charitable Trust fund and getting the organization running.

Davis said there is “obviously” a difference of opinion, but still, she said, the job was done professionally by Mills and the organization is primed to have a good start. “I commend you for that,” she said.

However, Davis said, some of the duties of the organization mirror what the College of Southern Maryland is already doing for different nonprofit organizations.

“The duplication disturbs me a little bit,” Davis said. “I hope as we move forward and review applications for charitable organizations that we’re not funding any charitable organization that has 25 percent administrative costs.”

Mills said she welcomes questions about administrative salaries and that is something the organization can look into, but the range of salaries on administrative positions has a high variance within the state and the costs associated here are no different.

“There’s a tremendous range,” Mills said. “Some of the larger nonprofit organizations in Charles County, the CEO ranges up to $150,000.”

Overall, Mills said, it is like comparing apples and oranges. The Charitable Trust organization has a broad base and wants to serve the entire nonprofit community.

It would be “really wise,” Mills said, to have a good look at salaries in future budgets to make sure everything is in line.