Hughes not fan of 1981 finance act for Sullivan

Rick Wagner • Mar 2, 2020 at 11:30 AM

BLOUNTVILLE — Sullivan County Board of Education Chairman Michael Hughes says he’s unsure of the intent and all the details of a County Commission proposal to move the financial management of the school system under the county’s Accounts and Budgets umbrella.

However, Hughes said he knows at least three things about the situation: The commission can make the change without school board approval; the commission still will have to meet maintenance of effort requirements in Tennessee law; and school system Business Manager Ingrid DeLoach won’t be going to work for Accounts and Budgets Director Larry Bailey in the old county courthouse instead of for the school system in the nearby health and education building.

The 24-member commission is considering a resolution by Commissioner Herschel Glover of Bluff City to adopt the County Financial Management System of 1981 to replace the currently adopted Local Fiscal Control Act of 1957, although county officials also have discussed requesting a General Assembly private act to replace the 1957 act. Changing acts or going to a private act would require a two-thirds (or 16-vote) commission majority.

“I don’t know what the intent of any kind of private act,” Hughes, of Hickory Tree, said. “Nothing they could do in a private act (or the 1981 act) would do away with maintenance of effort.”

He was referring to a state requirement that the commission fund education at its current level. However, a year-to-year decrease is allowed in proportion to any reduction in student population. Last year, a disagreement over revenue estimates and losses from the so-called “city-county split” of revenues led to a standoff, during which school leaders said a system shutdown could have occurred in October. 

That possibility was averted after Jason Mumpower of the Comptroller of the Treasury visited Blountville and the two sides came to an agreement. Mumpower, a former state House member from Bristol, again came to Blountville Thursday, this time to talk about the 1981 act versus the 1957 act. Sullivan, Hawkins, Washington and other area Tennessee counties each year have comptroller audit results that call for a move to the 1981 act. In the region, only Carter County operates under that 1981 act. Carter is among 25 counties across the 95-county state that operate under the 1981 act.

The commission and school board also have sparred over the opening and other details of the new Sullivan East Middle School, which welcomed students in January, and West Ridge High School, to open in August 2021.

“Some people on there (the commission) think it will give them more control over the budget,” Hughes said, adding that he thought the commission would “have to hire a finance director” in addition to Bailey and DeLoach since “Ingrid won’t be moving.” However, Bailey Thursday night said current school system finance employees, including those doing payroll and benefits, would transfer to the county Accounts and Budget office.

“I think this law was intended for much smaller systems,” Hughes said.

However, he said he understood the comptroller’s office would benefit from a “one-stop shop” for audits. “You don’t get any more control, but you get a lot more responsibility,” Hughes said. “We’re still going to get the same amount of money. We may have to fight to it a different way.”

Hughes said he worried such a move might cost jobs.

“Ingrid’s staying with us,” Hughes said. “We’re not giving up Ingrid.”

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