Walker County Commissioner Shannon Whitfield signed two resolutions Thursday authorizing the county to partner with two local banks to improve cash flow.
The Bank of LaFayette and First Volunteer Bank each agreed to loan Walker County up to $3 million through a Tax Anticipation Note (TAN). These short term loans, which must be repaid by the end of the calendar year, will help fully fund government operations until budgeted revenue is received.
“We originally thought we would need to do this in May. We’ve gone three months longer than anticipated, which means we’ve had good money management. Our entire county government team has committed to make sure every citizen’s dollar is spent wisely,” said Commissioner Shannon Whitfield. “We are getting our financial house in order and Walker County is earning its credibility back.”
In January 2017, Walker County faced an $8 million shortfall in operating expenses for the year. The county addressed the financial crisis through a series of moves to cut expenses, improve efficiencies and using $7.5 million of an $8 million line of credit, which was paid off early on December 22, 2017. This year, TAN’s are $2 million less than the amount authorized last year. Commissioner Whitfield aims to reduce the need for TAN’s by $2 million each year until the cycle is broken.
“I cannot say enough positive things about The Bank of LaFayette and First Volunteer Bank,” added Commissioner Whitfield. “They both stepped up last year and stood in the gap for this county when everyone else was running for cover. Their boards took a risk, but they also took pride in their community by doing their part to support the direction the county is moving in.”
Walker County remained committed to continuing its relationship with these local lenders because of their steadfast support last year. The Bank of LaFayette will charge a 3.10% interest rate on its TAN, while First Volunteer Bank will charge 3.25% interest.