Montgomery County’s secret government budget totals tens of millions of tax dollars

Conroe, March 6 – Montgomery County’s annual budget is far greater than the $381 million that County Judge Craig Doyal and the four County Commissioners disclose when they vote upon and publish the Annual Budget, because those funds do not include tens of millions of dollars of monies carried over and unspent from previous years. There are few restrictions on the expenditure of those funds, as the Commissioners Court hides most uses of the funds through “budget amendments” and “payment of accounts” tucked within the secretive “consent agenda.” The amount of money involved truly is staggering.

By press time, the current amounts of the “slush funds” for each of the four Commissioners Precincts during the current Fiscal Year 2017 remains unknown. During Fiscal Year 2016, the carried over funds in four off-budget accounts with the accounting suffix “-7997” were:

Precinct 1 Commissioner Mike Meador    $11,107,727.20

Precinct 2 Commissioner Charlie Riley     $1,157.857.47

Precinct 3 Commissioner James Noack     $7,105,898.09

Precinct 4 Commissioner Jim Clark            $2,552,904.25

Total “7997” Accounts                                   $21,924,387.01 (!!!)

In fairness to Commissioner Meador, $7,613,304.60 comprised funds earmarked for the extension of League Line Road. Even without including those funds, the carryover funds comprised $14,311,082.41.

Either way, it’s a lot of money.

There’s a positive aspect to these facts. They represent funds which the current or previous officeholders of the Commissioners Precincts did not spend.

There are many negative aspects of this situation. First, these funds are not subject to budget restraints (to the extent that the Montgomery County government, in all of the secrecy of its spending methods, even has such restraints.) Second, these funds reveal a fundamental mis-allocation of monies. Portions of the County, especially Commissioners Precincts 2, the southern portion of 4, and arguably 3, which are experiencing the vast majority of the County’s population growth, are not receiving appropriate amounts of funds for road and bridge development. Clearly, the carryover of $3.5 million of unspent road funds in Commissioners Precinct 1 either reflects Commissioner Meador’s failure to attend to road and bridge projects or an inordinate amount of funds budgeted for that Precinct (or possibly both). Third, the reality is that Montgomery County’s government budget for Fiscal Years 2017 and 2016 is actually considerably higher than the $381 million which the County publishes in its budget report on the County’s website.

Another frightening aspect of this data is that it only represents carryovers of funds from certain accounts, primarily unspent road and bridge accounts. There are millions of dollars of other off-budget accounts which the Commissioners Court has not included in the Annual Budget. For example, during Fiscal Year 2016, Commissioner Charlie Riley held just under $2 million in Account 7487 earmarked for the “SJRA project.” There are several other carryover accounts for each of the four Commissioners Precincts.

These funds do not include the “ghost employees” which both the Citizens Budget Committee and The Golden Hammer have previously discussed. Those “ghost employees” included budgeted funds for positions which remain unfilled often for years but keep a Department’s budget “bloated” in that amount. The best example of such a “ghost employee” is the approximately $58,000 which County Judge Craig Doyal has kept funded in his Departmental 400 account. Doyal has listed “5” employees in his department during his entire tenure as County Judge. Nevertheless, he actually only as four people working there, Doyal himself, two secretaries (Patti Werner and Sylva Olszowy), and his “chief of staff” jim fredricks (earning $118,000 per year in salary to “manage” himself and two secretaries, in addition to the two outside businesses he operates on the side).

From audit and accounting viewpoints, the County should address these funds far more responsibly. County Commissioners should not have millions of dollars with which to play with little, if any, transparency.

Bill O’Sullivan, a longtime political activist and Vice Chairman of the Citizens Budget Committee, described the situation: “It’s a practice known as ‘Rat Holing.’ This group of accounts is how [County Auditor] Phyllis Martin ‘found’ $1 Million in a few minutes in one Commissioner’s Court. First, a Court Order should freeze those funds and they need to be segregated preferably by Court Order in conjunction with the District Judges. Second, Phyllis has to know about this situation so she should go. Third, the funds should become a ‘Rainy Day Fund’ of sorts subject to restrictions on accessing it. At first, administered by the District Judges. Once the Road and Bridge Fund has been audited, a ring fence needs to be placed around all R&B funds thereby ending the ‘slush fund’ aspects of them. All unspent funds need to be swept into the ‘Rainy Day Fund’ or the ‘Road and Bridge Fund’ by formula for each Precinct. A Commissioner who is able to do this sweep should not be penalized in succeeding budgets.”

O’Sullivan explained that his reference to the “District Judges” arises from their duty to oversee and audit the use of all Montgomery County funds under the Texas Local Government Code.

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