LaFayette, GA – 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.
LAFAYETTE, GA – Walker County Sole Commissioner Shannon Whitfield successfully repaid two Tax Anticipation Notes (TAN) before an end of year deadline, saving the county an estimated $12,194 in interest.
Walker County borrowed $4 million from the Bank of LaFayette in January and received a $4 million line of credit from First Volunteer Bank of LaFayette in June to fund the county’s monthly operational expenses. The loans were necessary after the previous administration left Walker County over $70 million in debt, with very little cash on hand and over $3.5 million in past due bills on January 1st.
Commissioner Whitfield pointed out the county actually borrowed less than originally estimated. “We projected we would need $8 million to meet our obligations for 2017. After restructuring some services to manage county government more efficiently, we only had to borrow $7.5 million,” said Whitfield.
Walker County made a $1 million payment on the Bank of LaFayette TAN on November 13th and a $2 million dollar payment on December 12th. Whitfield hand delivered checks to the Bank of LaFayette and First Volunteer Bank of LaFayette on December 22nd to pay off the remainder of both loans.
A $5 million TAN from an out of town bank obtained in 2016 by former Commissioner Bebe Heiskell cost the county $258,393 in fees and interest. Whitfield affirmed, “Walker County borrowed $7.5 million in 2017 from two local financial institutions, receiving lower fees and favorable interest rates that added up to $135,133. Banking local saved the county $123,260 compared to the previous year’s TAN loan.”
Whitfield anticipates another TAN won’t be needed until summer 2018. “As we continue to make progress to return Walker County to solid financial footing, I hope to end the process of borrowing money for regular day to day operations by 2020.”
Rossville, GA – What are you doing for lunch this Friday? Walker County Sole Commissioner Shannon Whitfield invites you to join him for a meal, as he supports Georgia Small Business Week.
Whitfield’s first “Lunch Conversation with the Commissioner” will take place at La Familia at 516 Chickamauga Avenue in Rossville between 11:45 am and 1:45 pm on Friday, March 17th. The public is encouraged to drop by, purchase a meal and enjoy some friendly conversation about the state of Walker County.
Since taking office in January, Commissioner Whitfield has been urging residents to shop and dine within Walker County, which benefits local business owners and the county’s tax base.
Small businesses keep our community and state economies growing strong. According to the Walker County Chamber of Commerce, 63 percent of its members are businesses with less than 10 employees.