SPRINGFIELD, Mo. — Auditor Nicole Galloway says Missouri is not prepared for a recession.
On Tuesday, Galloway called Missouri lawmakers to act on Missouri’s “rainy day fund.”
Her audit of the state’s Budget Reserve Fund found Missouri’s “rainy day funds” are used throughout the year for day-to-day expenses, leaving little funding available in case of a recession.
Here in Greene County, it’s a different story
Greene County Treasurer, Justin Hill, says not only is the county prepared but is even more prepared than other counties around the state.
“Beyond the 90-day reserve, we also have a little 3% cushion in every year’s budget,” says Hill.
He says the 90 day is like an account with a bank and is used to fund the county with three months’ worth of funds in the event of a recession. The 3% cushion is decided every year when the county plans the budget. If you visit the Greene County website you can see the budget through their Transparency Portal.
If you do the math, 3% of their total budget for 2019 ($173,944,934.15) would equal to $5,218,384.02 that is used for the cushion.
Hill says the general funds for the county are around $50-52 million so we did some math to figure out how much money would be in that 90-day fund.
We took the $50 million and divided that by 365, the number of days in a year, then multiplied that result by 90, for the 90 days. That total came out to 24.6, which we understood as %24.6. We then multiplied 0.246 to the $50 million and got a little over $12 million that is in that 90-day fund.
Between the two totals, there is roughly $17 million put aside if a recession were ever to hit.
Hill says the county has had to use money from those resources when the recession hit 10 years ago.
“So back in 2008-2009 recession hit. So about that time during those years from 2009-2012, we were dipping into those. About 2012-2013 we got caught back up reestablishing those and I don’t think we’ve had to dip into them since.”
The third aspect Hill talks about how Greene County is prepared is modeled after the Great Game of Business.
“We also have an element in there of projecting and forecasting and watching the numbers every single month so that if a recession is looming on the horizon. We see it coming way ahead of time and we can start to respond before it even hits, whatever that looks like,” says Hill.
Auditor Galloway called on lawmakers to create a true budget stabilization tool to ensure the state is prepared in case of an economic downturn.
According to a press release, without an effective tool to protect citizens, the state would be left with two options according to Galloway: cutting funding for critical services or raising taxes.