Foreclosure and local government general funds

An article referencing “Colorado Counties Foreclosure Fees” was forwarded to my desk, with a big question mark. What was my take on a madly spinning article? There were more questions than answers and the way departments and counties handled the excess does not make them villains.

It was a big discovery that only took 4 years to come to the surface. I suppose that the reporters and citizens never hear of SUNSHINE laws and Freedom of Information. Naturally though, most people do not find local government business meetings, particularly the reams of paper involved with finance and budget, to be particularly exciting.

The article gave figures from the peak of the foreclosure action, but did not address how and when the fees were decided. Very likely, in 2004 fees would barely make the Public Trustees offices self-sustaining. I would not be surprised in fact, if the Public Trustees were operating at a deficit prior to the dates given in the chart at the bottom of the article.

It is no surprise that the revenue the departments achieved was in excess to their expenses due to the increase in foreclosures. There is a distinct possibility, that the offices prior to 2008 were maintaining a balanced budget with a lower number of foreclosures. Personnel and programs could handle the higher workload without increasing work hours or increasing material expenses.

Particularly disappointing was the judgment that releasing the excess to the General Fund was not preferable to funding various counseling programs. A couple of names were given. Counseling programs were identified as not for profit, but not linked to the public county offices. Having a county name for the local counseling center does not mean the center should be funded with county revenue. Using public funding for counseling centers could leave the counties vulnerable to lawsuits regarding conflict of interest and liability for incorrect or poorly executed advise.

I would think the general pubic would be grateful the funds remained in the counties’ general operating funds. Hopefully it helped defray other expenses and made the general operations more efficient or more pleasant. Otherwise the next headline would be “County cuts funds to counseling centers” when foreclosures decline and the excess funds are reduced or eliminated.

In really big government, the excess money would be spent on a “fact finding” mission to some really remote area with an extended expense paid layover in a pricey resort area or maybe finding facts in Hawaii. In big business, the department heads would be rewarded with big bonuses distributed from the funds. Instead counties used the money to buy office supplies and toilet paper. More people should attend town hall meetings, get familiar with SUNSHINE laws, and scrutinize the budget while screaming FOIA.