Similar to a savings account, or rainy day fund, taxing entities keep some excess funds on hand from year to year, usually around 25 percent, but those balances tend to grow to higher levels for a variety of reasons and spending reserves can sometimes become problematic.
Reasons for the different levels of what are referred to as reserve funds depends on the entity, and carrying an excess of reserves can sometimes be viewed as hording money that rightfully belongs to taxpayers, a view that is not generally accurate.
“We are growing so fast that we are setting more money aside,” Collin County Judge Keith Self said. “We are trying to whittle it down.”
Self pointed out that the county is suffering from an embarrassment of riches and currently is carrying a reserve balance equal to 70 percent of expenditures.
By Joe Reavis • [email protected]