Officials in Cherokee County are trying to prepare for possibly not being able to pay employees and bills. County commissioners are working to collect $1.7 million in unpaid real estate taxes that date back from as far as 1993. But there's another issue that may prove detrimental soon.
Cherokee County officials say there could be a time of reckoning come the end of this month.
"I don't know if I would use the word crisis, but we do have a serious situation," says Cherokee County Clerk Rodney Edmondson.
Cherokee County Clerk Juanita Hodgson says, "It's a big issue. If you don't have the funds to pay your employees, pay your bills, what happens?"
What could happen has the potential of affecting more than 100 county employees, including ones with the Cherokee County Sheriff's Office, who all get paid from the county's general revenue fund. County officials say revenue going into the general revenue fund has been decreasing.
"Cherokee County, we don't have any utilities. We're pretty much at the mercy of tax revenue," says Edmondson.
How much revenue comes to the county within the newt few days will dictate how dry the general fund gets, and how much money the county will need to borrow. County officials estimate the shortfall could be between $300,000 to $800,000.
"Sales tax revenue is down $147,407 from last year to this year," says Hodgson.
County commissioners have asked the county clerk to solicit closed bids from local banks for loans. One of them is called a no fund warrant, issued by the State of Kansas.
"The drawback on that is that could take 90 days, even longer," says Edmondson.
Another type of loan would involve the county putting a lease on equipment the county already owns.
"The negative would be that's money that's going to have to be paid back under the current budget for next year," says Edmondson.
The long-term solution, no matter what, is the county somehow collecting more revenue. Two Wal-Marts have recently closed in Cherokee County. One of them, in Baxter Springs, generated more than $200,000 a year in county sales tax revenue.
"If those same sources of revenue continue to decline, then more cuts are needed. Then you get into the reductions of services, reductions in personnel. It snowballs from there," says Edmondson.
Right now, there's no telling how big that snowball will get.
The amount of revenue coming to the county before the end of this month is so uncertain, some county commissioners say there could be no need to borrow money. County commissioners will review the bids from local banks on Monday.
KOAM - Licensed to Pittsburg, Kansas