FRANKFORT, KY. (December 14, 2021) – M E M O R A N D U M TO: County Treasurers
FROM: Robert Brown - State Local Finance Officer
DATE: December 14, 2021
SUBJECT: Tornado and Severe Weather Assistance
The disastrous tornadoes of December 11th brought Kentucky and her counties a level of destruction never seen before. As a direct result, many counties are in declared states of emergency, with many operating out of makeshift offices. Our thoughts are with all the counties, towns, and communities as we move to the next phase of recovery.
In the past couple of days, we have seen a flood of generous donations and assistance from caring people and corporations from across our great nation. This assistance is so helpful to our people, and it is something that we hope continues for the immediate future. With this in mind, we want to remind counties that donations should be handled responsibly and used for the public good of all as authorized by statute. We want to provide counties some guidance in how to handle these funds in a fiscally responsible and legal manner.
First, monetary donations should be separated into a special fund (#75- #88). We recommend the use of code 4728 to receive the donations in whichever fund your county chooses.
Second, these donations will need to be amended to the budget by the fiscal court before they can be expended.
If your county is in a declared state of emergency under KRS 39A.100, then the expenditure of the funds is likely an immediate priority, and the proper procedure may be suspended. We advise counties to review the statute with the county attorney to ensure that operations are within limits of the statute.
If the county has not declared a state of emergency pursuant to KRS 39A.100, and the need to expend the donated funds is not immediate, then we would ask counties to consult with their county attorneys to conduct meetings according to KRS 61.823 and amend the budget according to the provisions of KRS 67.078, as the situation in your county requires.
While the fiscal court has the implied power to receive monetary donations from private persons and corporations, the funds must be expended for county governmental purposes as authorized by statute . Thus, the fiscal court should avoid accepting donations with conditions that surrenders the statutory responsibility of the fiscal court to determine the governmental functions necessary for the operation of the county.
Lastly, if the fiscal court appropriates any of the funds to nonprofit entities they must be for a “public purpose”. To determine whether an appropriation or expenditure is for a public purpose, the fiscal court must consider several factors, including whether the receiving organizations provides services that will be for the general good and welfare of their citizens and whether the fiscal court retains some control and accountability over the expenditures, such as a follow-up reporting requirement by the non-profit entity noting how the funding was utilized.
DLG is committed to serving you. We sympathize in the hardships you are currently enduring. Please know that if you have any questions or concerns, we are here for you. Do not hesitate to contact any member in our Counties Branch.
