HomeMy WebLinkAbout2021-088 - Res. Amending Mason County Code Title 2 Chapter 2.151 Financial Policies and Procedures RESOLUTION NO. 101\- Q&
AMENDING RESOLUTION NO.2020-72 AND AMENDING MASON COUNTY CODE
TITLE 2,CHAPTER 2.151
MASON COUNTY FINANCIAL POLICIES AND PROCEDURES
WHEREAS,financial policies and procedures play an important role in a strategic,
long-term approach to financial management.
WHEREAS,the Board of Mason County Commissioners recognize that it is in the best
interest of Mason County to establish financial policies and procedures in order to promote
sound financial management.
NOW,THEREFORE,BE IT RESOLVED,that the Board of Mason County
Commissioners does hereby adopt the Mason County Financial Policies and Procedures
(Attachment A).
APPROVED this day of Oe�2021.
BOARD OF COUNTY COMMISSIONERS
Rand Neatherlm,Chair
i�7&:��
Kevin Shutty, C mmissioner
Shar�Tr , ommissioner
ATTEST:
McKenzie Sm>< , Cler f the Board
APPROVED AS TO FORM:
Tim itehea , ief DPA
C: Accounting,Treasurer,Public Works,Budget&Finance
Co
Mason County
Financial
POLICIES & PROCEDURES
Table of Contents
I. Overview of the Mason County Financial Policies& Procedures 4
II. Budget 4
1) Purpose 4
2) Schedule 4
3) Budget Adjustments 4
4) Operating Budget 5
5) Capital Budget 6
6) Internal Rates Calculated for the Budget 6
III. Basis of Accounting 7
IV. Accounting Policy, Financial Systems, and Reporting 7
1) Accounting Policy 7
2) Financial Systems 7
3) Financial Reporting 8
4) State Audits 8
V. Cash 8
1) Receipting 8
2) Petty Cash/Revolving Funds 8
3) Bank Accounts 9
VI. Investments 9
VII. Grants & Federal or State Funding 9
1) Grant Project Form 9
2) Year End Program Contract Worksheet 10
3) Federal Policy 10
Vill. Debt 10
1) Authority for County Indebtedness 11
IX. Revenue 11
1) Accounts Receivable 11
2) Wage Overpayments 11
3) Collection Policy 12
4) Refunds vs. Reimbursements 12
5) Public Fees & Charges 12
X. Expenditures 13
1) Budget Appropriation and Monitoring 13
2) Travel/Business Expenditures 13
3) Non-Travel Food Purchases 13
4) Purchasing 14
5) Lost Warrants 14
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X. Expenditures (continued)
6) Registered Warrants 14
7) Credit Cards 14
8) Outside Vendor Credit Accounts 14
9) Miscellaneous 14
XI. Adjusting Journal Entries 15
XII. Payroll 15
XIII. Capital Assets 15
1) Real Estate Excise Tax (REET) Funds 15
XIV. Fund Balance 16
1) Classification 16
2) Minimum Level 16
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1. OVERVIEW
This Financial Policies and Procedures handbook is intended to provide guidance to Mason
County department heads and elected officials in properly discharging their financial
responsibilities. The procedures, policies, and practices set forth below do not create an
express or implied contract between Mason County and its employees, nor are they to be
viewed as making any promises or creating contractual rights of any kind. The information
contained in this notebook represents guidelines only, and Mason County reserves the right
to limit, modify, or terminate any of these policies, procedures, or practices at any time, at its
sole discretion.
'` IL BUDGET
1) Purpose
The budget serves a number of functions. At the most basic level it is a legal document
that gives County officials the authority to incur obligations and pay expenses. It is also a
comprehensive business plan that should provide the following elements: public policies,
a financial plan, an operations guide, and serve as a communications device. Mason
County budgets on an annual calendar year basis.
2) Schedule
RCW 36.40 prescribes the major steps in budget preparation along with a suggested
schedule for completion of each step. However, the Board of County Commissioners may
also set other dates relating to the budget process, including but not limited to the dates
set in RCW 36.40.010, 36.40.050, and 36.81.130 to conform to the alternate date for the
budget hearing. Mason County typically adopts the alternate dates in July.
The major steps in budget preparation include:
a) Call for Estimates. County Auditor notifies all officials to file budget requests and
projected revenues for ensuing fiscal year. RCW 36.40.010
b) Filing of estimates with Auditor or Chief Financial Officer by all officials in the format as
requested by the Auditor. RCW 36.40.010
c) Preliminary County budget prepared by Auditor or Chief Financial Officer submitted
to Board of Commissioners. RCW 36.40.050
d) Preliminary budget hearing presented to the Board of County Commissioners by the
Auditor's Office. RCW 36.40.070
e) Alternative preliminary budget hearing by the Board of County Commissioners, on the
first Monday in December. RCW 36.40.071
f) Final budget adoption by the Board of County Commissioners. RCW 36.40.080
3) Budget Adjustments
Budget Transfers are used when changes in spending during the year result in a deficit in
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one expenditure line item and an excess in another line item, in accordance with
Resolution 26-17.
• Transfers within Department's Budget
Budget transfers may be made from the excess line to the deficit line to keep their
operating budget correct with the Budget Manager's approval
• Transfers Inter-Departments
All requests for budget inter-department transfers shall be submitted, with
department head approval and justification, to the Board of County
Commissioners for consideration and approval. The Board of County
Commissioners' approval is required prior to budget expenditure.
Supplemental Appropriations are required when a department receives a new funding
source that was not planned for during the budget process and will result in additional
expenditures or when there are additional expenditures that weren't planned for during the
budget process. Supplemental appropriations must be advertised for two weeks prior to
Board approval.
Non-Debatable Emergency adjustments may be made due to an emergency caused by
fire, flood, explosion, storm, earthquake, epidemic, riot, or insurrection, or for the
immediate preservation of public health or any other emergency as defined by RCW
36.40.180.
Emergencies Other than Non-Debatable may be made when there is a public emergency
that does not fall under the qualifications of RCW 36.40.180. Emergencies other than
non- debatable must be advertised for one week prior to Board approval.
All requests for supplemental or emergency appropriations will be submitted by the
department head to the Board of County Commissioners for consideration and approval.
The request shall be in writing, containing the facts constituting the supplemental or
emergency appropriations and the estimated amount of additional budget required.
Supplemental appropriations are done as needed.
4) Operating Budget
The operating budget is the central financial planning document that encompasses all
operating revenue and expenditure decisions. It establishes the level of services to be
provided by each department within the restrictions of anticipated County revenues.
Current expenditures will be paid for with current revenues. One-time expenditures, or
revenues of a limited or indefinite term, should be used for capital projects or one time
operating expenditures to ensure that no core services are lost when such revenues are
reduced or discontinued. No operating deficits in any fund balance shall be incurred at
yearend.
High priority will be given to expenditures that will reduce future operating costs, such as
increased utilization of technology and equipment and prudent business methods.
If expenditure reductions are necessary, complete elimination of a specific, non-
mandatory service is preferable to lowering the quality of existing programs.
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5) Capital Budget
A comprehensive six year plan for capital improvements will be prepared per RCW 82.46,
updated, and included in the yearly budget. Capital project proposals should include cost
estimates that are complete, reliable, and attainable. Cost estimates should be based on
a thorough analysis of the project and are expected to be reliable and complete. Funding
sources should also be reliable and complete and the capital project will not be budgeted
unless there are reasonable expectations that revenues will be available to pay for them.
Changes to the comprehensive six year plan may be made annually during the budget
process or concurrently with an amendment of the County budget, per RCW 36.70A.130
(2)(a)(iii). Any revision to the comprehensive plan would have to go to the state for review
sixty days prior to adoption.
The County will provide for adequate maintenance and appropriate replacement of capital
facilities and equipment. The County will also provide for maintenance schedules to
ensure that facilities and equipment are maintained so as to maximize its useful lifespan.
These amounts will be reflected in the capital budget plan. The intent of the Capital
Budget Plan is to maintain all assets at an adequate level in order to protect the County's
capital investment and to minimize unexpected future maintenance and replacement
costs. Funding of repair and replacement schedule projects will be the funding priority
before discretionary capital projects.
Decision making for capital improvements will be coordinated with the operating budget
to make effective use of the County's limited resources for operating and maintaining
facilities and capital projects.
6) Internal Rates Calculated for the Budget
Internal rates are those in which one County fund charges another County fund for
services. Internal rates calculated for the budget each year include but are not limited to:
The Annual Internal Allocation, Information Technology, and Equipment, Rental &
Revolving. The rates shall be prepared using actual data from the previous full year for
the next year's budget. To maintain appropriate internal controls, the preparing
department's calculation of rates shall be checked by either the Budget Office or Auditor's
Office before being charged out.
a) The Internal Allocation is the annual charge to non-General funds for the services
provided by the General fund. Internal allocation rates shall be prepared with a detailed
indirect cost allocation plan. The internal indirect cost allocation plan shall be
developed each year with audited expenditures to identify and distribute costs of
services provided by internal service departments to funds outside of the General
Fund. The Auditor's Office and the Budget Office will prepare this after the close of
the previous year and incorporate the charges into the following year's budget, which
is adopted by the Board of County Commissioners. These will be the actual costs
charged to funds outside of the General Fund.
b) Information Technology (IT) is an internal service fund with rates charged to all users
of the fund. Rates are calculated by the Budget Office. IT purchases that benefit the
County as a whole are budgeted for and paid out of the IT fund. IT purchases specific
to an individual department are budgeted for and paid out of individual departments.
All direct and indirect costs of the IT fund shall be incorporated into the rates.
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c) Equipment Rental and Revolving (ER&R) is an internal service fund with rates
charged to all users of the fund. Rates are calculated by Public Works. Capital
equipment specific to an individual department may be budgeted for and paid out of
ER&R or the individual benefiting department(s) at the BOCCs' approval. All direct
and indirect costs of the ER&R fund shall be incorporated into the rates.
Ill. BASIS OF ACCOUNTING
The basis of accounting used determines when revenues and expenditures/expenses are
recognized in the accounts and reported in the financial statements.
All funds are accounted for using the cash basis of accounting, in accordance with Resolution
67-17.
Only the minimum number of funds consistent with legal and operating requirements should
be established, because unnecessary funds result in inflexibility, undue complexity, and
inefficient financial administration.
In order for a special revenue fund to be created, the following two criteria must be met:
1) Expenditure for specified purposes — Such a limitation on spending may be imposed by
external parties, constitutional provisions, enabling legislation, or board action, and
2) Proceeds of specific revenue sources—A substantial portion of resources must be derived
from one or more specific revenue sources. A surplus in the General fund does not constitute
a revenue source
The Board of County Commissioners has the authority to create or delete funds by resolution.
IV. ACCOUNTING POLICY, FINANCIAL SYSTEMS &
REPORTING
1) Accounting Policy
Mason County will establish and maintain the highest standard of accounting practices.
Accounting and budgetary systems will conform to the State of Washington Budgeting
Accounting Reporting System (BARS) and local regulations.
2) Financial Systems
Mason County will strive to provide the technological tools, information systems support
and uninterrupted level of information systems service to sustain the successful
implementation and maintenance of a sound, reliable and efficient financial management
system.
The financial system shall also protect County departments against unauthorized access
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through information systems security and controls while allowing staff the ability to access
information directly from the system.
Munis is currently the County's primary financial system. The primary financial system
serves as the County's principal journal of record.
3) Financial Reporting
Full disclosure will be provided in all County financial reports and bond representations.
Reports outlining the status of revenues and expenditures shall be prepared monthly on
cash basis by the Budget Office. It will be distributed to the Board, elected officials,
department heads, and any other interested party.
An annual financial report will be prepared by the Auditor's Office in a timely basis to meet
or exceed the State Auditor's Office standards.
4) State Audits
An annual audit will be performed by the State Auditor's office and include the issuance of
a financial opinion.
Cash deposits from the various operations are remitted to the Treasurer's Office and RCW
36.29.010 stipulates the Treasurer's responsibilities over cash. All County employees or new
hires who handle cash are required to review, sign, and follow the department's procedures
for cash handling. For additional information and detail see Mason County Revenue (Cash)
Handling Policies and Procedures.
1) Receipting
Departments that receive cash for services or fees are required to evidence receipt by
pre-numbered cash receipts. Cash shall be deemed to include cash, checks, or other
financial instruments that can be converted to cash. Checks should be endorsed
immediately and must be maintained with other cash items in a locked and secure
location. Cash receipts must be balanced and deposited with the Treasurer's Office on a
daily basis, unless exemption is approved, pursuant to RCW 43.09.240. The size and
amount of deposits vary by location and department. Alternative receipt practices may be
adopted only by approval of the County Treasurer. Where ever possible, the functions of
receipting, balancing and depositing should be performed by different personnel to
ensure adequate safeguards.
21 Petty Cash/Revolvina Funds
Departments may maintain petty cash or revolving funds for the payment of incidental
expenses only with the Treasurer's prior approval and evidence of accounting ability to
maintain the fund to the County standard. These funds are not intended for repository of
cash receipts in the normal course of business and must not be commingled.
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3) Bank Accounts
The use of bank or other financial institution accounts for the purpose of depositing or
maintaining public funds is forbidden without the prior consent and knowledge of the
Mason County Treasurer, his/her office and staff.
Vl. INVESTMENTS
The County Treasurer has responsibility for the investment of public funds under RCW
36.29.020. Investments are carried at book value and investments are made by fund.
Investments are held by a third party trust agreement on a delivery versus payment basis
and are booked electronically. Authorization to invest funds of a district or related entity is
required in writing by an appointed investment officerfor the district. The County Treasurer
invests the County's short term cash and reserves for maximum return according to the
investment policy established by the Mason County Treasurer and the County Finance
Committee.
Vll. GRANTS & FEDERAL OR STATE FUNDING
Grant applications will be reviewed by the Board of County Commissioners with due
consideration being given to whether locally generated revenues will be required to support
these programs when outside funding is no longer available. Approved grant agreements will
be signed by the Board of County Commissioners or their approved designee. Grants may
be accepted if the County can be assured that the total costs and requirements of accepting
funds are known and judged not to adversely impact the County's funds. Future impacts on
the budget will be identified and analyzed prior to approval of grant contracts
Grant related revenue and expenditures (including matching funds provided by the County)
shall be authorized,within policy, and properly accounted for in the project accounting module
of the financial management system according to Federal, State and local
regulations and the terms and conditions of the grant award. The department receiving the
grant award will budget for and expend any costs related to obtaining the grant, unless an
agreement with the Board is made otherwise.
The responsibility for understanding and adhering to County, State and Federal regulations,
policies or procedures belongs to the managing department of that particular grant.
Continuing education for state and federal grants is expected for all grant managers within
the County.
1) Grant Project Form
When an application for grants is approved, or when a new federal or state funding source
is secured, the department must complete and provide to the County Auditor the grant
project form as prescribed by the County Auditor. A signed copy of the grant must be
submitted with the grant code request form to the Auditor's Office. This helps ensure the
required funding source information has been gathered so the Auditor can assign the
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proper revenue number in accordance with the State Auditor's BARS manual.
2) Year End Program Contract Worksheet
At the end of each fiscal year, the County Auditor will provide a listing of all federal and
state funding sources that were reported to the State Auditor's Office on Schedule 15 and
Schedule 16. Each department must complete and provide to the County Auditor the
program contract worksheet as prescribed by the County Auditor. These worksheets are
considered the final Schedule 15 and Schedule 16 data, which is compiled by the County
Auditor into a single document.
3) Federal Policy
The departments shall also use applicable cost principles from the US Code of Federal
Regulations Title 2, part 200 (2 CFR 200) to determine the reasonableness, allow ability
and allocation of costs applicable to federal grants and contracts.
The County shall recover the full cost of providing internal services to funds with grant
revenue as permitted under the grant agreement and 2 CFR 200.
Any instance where a potential conflict of interest may arise must be disclosed in writing
by the responsible department to the federal awarding agency or pass-through entity in
accordance with applicable Federal awarding agency policy. The definition of a conflict
of interest is described in 2 CFR 200.318(c) Reference Mason County Conflict of Interest
Policy. Any instances of violations of federal criminal law involving fraud, bribery, orgratuity
violations potentially affecting federal awards must be disclosed in writing to the federal
awarding agency or pass-through entity by the responsible department.
Elected Officials, Department Heads, and grant managers within each department are
authorized to sign the required certification as stated in 2 CFR 200.415.
For billing indirect costs to grants, use the rate determined by the simplified external
indirect cost allocation plan, which is calculated by the Auditor's Office.
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Deficit financing and borrowing will not be used to support ongoing County services and
operations. Expenses will be reduced to conform to the long term revenue forecast.
Interfund loans are permissible to cover temporary gaps in cash flow, but only by resolution
that states a short term repayment schedule and at an interest rate based on the Washington
State Local Government Investment Pool. The lending fund must have excess funds
available and the use of those funds won't have an impact on the fund's current operations.
For additional information and detail see Mason County Interfund Loan Policy.
If the Board of County Commissioners approves lease purchasing, the useful life of the item
must be equal or greater than the length of the lease. The fixed asset information form must
be provided by the department concurrent with the submission of the lease documents.
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Debt payments shall not extend beyond the estimated useful life of the project being funded.
Mason County will maintain good communications with bond rating agencies concerning its
financial condition, and will take all appropriate and responsible measures to sustain quality
bond ratings with continuous financial management efforts to enhance the County's bond
ratings. Mason County follows the Mason County Debt Policy which is maintained by the
County Treasurer.
1) Authority for County Indebtedness
Department heads do not have the authority to commit Mason County to any
indebtedness beyond current budget authority. For additional information and detail see
Mason County Purchasing Policy.
Indebtedness includes, but is not limited to leases, lease-purchases, rental agreements,
contracts, grants, and other obligations of short and long term debt.
The Mason County Commissioners shall be signatory to any obligations requiring short
or long term indebtedness beyond current budget authority, unless the Commission has
given written authority to exempt certain contracts.
IN
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The County will follow a vigorous policy of collecting all County revenues.
Revenue will be coded to the correct account per the Washington State BARS (Budgeting,
Accounting, and Reporting System).
Grant revenue must be deposited with the Mason County grant project code as assigned by
the Auditor's Office.
11 Accounts Receivable
Currently, billings for services, goods, and reimbursements for funds are done through a
de-centralized financial accounting system.
If revenue is anticipated, the department anticipating the revenue shall notify the
Treasurer's office by Treasurer's ACH form or deposit form prior to receipt to ensure
proper recording.
There will be adequate segregation of duties relating to accounts receivable. To
accomplish this, the billing, cash collection, recording, and reconciliation functions should
be separated. If this level of segregation of duties is not possible, compensating controls
should be implemented to ensure a proper division of functional responsibility.
2) Wage Overpayments
Debts due to the county for the overpayment of wages to their respective employees will
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be recovered by following the processes in RCW 49.48.200 and RCW 49.48.210.
3) Collection Policy
The collection policy and any action plan shall be established by the elected official or
department head, recognizing State requirements and the unique characteristics of the
clients served by that department. It is the responsibility of each department to collect their
accounts receivable.
Departments will review their outstanding receivables on a timely basis for past due
accounts. Accounts Receivable aging reports should be run in the de-centralized
accounting system in order to determine which accounts are past due. The oldest
outstanding accounts receivables will be reviewed on a regular basis.
Departments have the ability to handle past due accounts along reasonable business
practice guidelines.
An example of reasonable business practice could be as follows:
A past due notice is issued for all accounts that are 30 days past due. Notices
are issued by the responsible department every 30 days over a 90 day period.
Notices are distinguished as "first notice""second notice"and "final notice", with
the final notice indicating that the account could go to a collection agency if not
paid. At the discretion of the department or elected official, the initial notice
period can be extended in limited circumstances. No receivables should be due
for longer than 90 days without past due notices being issued.
It is imperative that departments practice due diligence to collect past due accounts, as
the writing off of bad debt may be viewed as a gift of public funds if collection actions are
not implemented.
As soon as accounts receivable are identified as uncollectible, the department should
request a write-off approval from the Board of County Commissioners.
3) Refunds vs. Reimbursements
Cash refunds from vendors are payments received for returned goods; for services paid
for, but not used; or for overpayments. These are the only items that may reduce
expenditures. Payments received by any outside agency as reimbursements for goods
or services are not refunds and should be recorded as revenue, not as a reduction of
expenditures.
If the refund is received after the end of the accounting period in which the original
expenditure was made, and the dollar amount of the refund is not material, a BARS revenue
account established bytheTreasurer's offioewill be credited for the amount of the refund.
4) Public Fees & Charges
The full cost of services shall be evaluated by each department regularly to provide a
basis for setting the charge or fee. Full cost incorporates direct and indirect costs. Fee
calculations should be reviewed by the Budget Office or Auditor's Office before being
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charged to customers.
X.EXPENDI TURFS
Expenditures will be coded to the correct account per the Washington State BARS
(Budgeting, Accounting, and Recording System).
The Elected Official, Department Head, or approved designee will be verifying with their
signature on the voucher that the payment of the indebtedness is authorized by the
Commissioners through the budget process.
Overall responsibility for the County's expenditures belongs to the County Auditor, per
Resolution 37-07.
1) BudaetApgronriation and Monitoring
The Board of County Commissioners adopts the General fund budget at the department
level and the special funds at the fund level. The County will not process expenditures in
excess of the total appropriation for that fund. Departments are responsible for monitoring
their budget expenditures. This is especially important during the last quarter of the
budget year. Invoices in excess of budget will not be paid until the budget allows.
Expenditures will be approved by the Board of County Commissioners at their next
regular business meeting.
Departments within the General Fund may exceed the approved budget within individual
line items, but shall not exceed total departmental budgets without Board approval of a
budget adjustment, per Resolution 26-17.
No fund shall exceed total fund budget without Board approval of a budget adjustment.
2) Travel/Business Expenditures
For additional information and detail see Mason County Personnel Policy, Travel Expense
Reimbursement.
3) Non-Travel Food Purchases
Food and beverages (not including water) may not be purchased for employees with
County funds unless the County is hosting an official meeting at which non-County
employees are in attendance or, in accordance with RCW 43.03.050, each of the
following criteria is met:
1) The purpose of the meeting is to conduct official County business or to provide
training to County employees or officials: and
2) The meals are an integral part of the business meeting or training session, and
3) The meeting or training session takes place away from the employee's or official's
regular workplace, and
4) The County obtains a receipt for the actual costs of the meals with meetings and the
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price does not exceed the corresponding Washington State per diem rate.
4) Purchasing
For all new individual vendors, a completed Vendor Info Form or W9 must be submitted to
the Auditor's Financial Services Department before payment to that vendor can be made.
Vendors may receive funds by Electronic Funds Transfer(EFT) by filling out the authorization form
provided by Financial Services.A prenote confirmation of the vendor's banking information will be
sent to their bank prior to any payment being made.
Departments that report directly to the Board must receive verbal Board approval during a briefing
before making purchases of items$25,000 or more, even if the authority is in the department's
budget.
For additional information and detail see Mason County Purchasing Policy.
5) Lost warrants
The County will not reissue a warrant, due to the loss of the original warrant, until a lost
warrant affidavit is turned into the Auditor's Financial Services Office. A lost warrant
affidavit may be turned in three weeks after the issue date of the original warrant, except
in the case of a payroll warrant.
6) Reaistered Warrants
Restricted cash flow and decreasing cash reserves require that Mason County enlist the
aid of other financial institutions to hold registered warrants. The Mason County Treasurer
reserve the statutory authority to issue registered warrants but has available several other
alternative arrangements to cover short term financing.
7) Credit Cards
Personal charges may not be made with a County credit card. Any charges which cannot
be properly identified or which are not properly allowed shall be paid promptly by the card
user. This includes finance charges, late fees, etc.
Retain credit card receipts with detail of purchases throughout the month. Once the credit
card statement is received, reconcile receipts to the statement, attach to an invoice edit
and send the edit, statement and receipts to the Auditor's Financial Services Office for
payment. For additional information and detail see Mason County Credit Card Policy.
8) Outside Vendor Credit Accounts
When the County has a credit balance on an outside vendor account, the balance must
either be used within 90 days, or a reimbursement must be made to the County from the
vendor.
9) Miscellaneous
Volunteer Recognition
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Mason County frequently receives assistance from volunteers in the community.
County departments may provide non-monetary recognition for volunteers not to
exceed the limitation on gifts, per RCW 42.52.150.
Other Recognition
Celebrations/Memorials/Flowers -
No County funds shall be used to purchase gifts or flowers for County employees or
relatives, except for retiring employees. For retiring employees, a gift with a value not to
exceed the limitation on gifts, per RCW 42.52.150, may be given by the County.
Xl. ADJUSTING JOURNAL ENTRIES
All adjusting journal entries will be accounted for by maintaining a file including the date,
posting number, description, preparer's and approver's initials.
There will be adequate documentation attached to the adjusting journal entry that will explain
the reasoning for the entry.
Departments may request an adjusting journal entry, but only Financial Services or
Treasurer's Office may post. The approver may not be the same person as the preparer.
Xll. PAYROLL
Please see the Mason County Employee Handbook and/or the Payroll/Human Resources policy
for detailed payroll and benefit policies.
Xlll. CAPITAL ASSETS
Capital Assets owned by the County that are required to be registered will be recorded in
the name of"Mason County" and not of an individual Department or Fund. For additional
information and detail see Mason County Capital Asset Policy.
1) Real Estate Excise Tax (REET) Funds
The State of Washington is authorized to levy a real estate excise tax on all sales of real
estate. A locally-imposed tax is also authorized. REET I and II taxes are collected by
Mason County. RCW 82.46 governs the REET funds.
REET I funds can be imposed by all cities and counties. In order to impose REET Il, the
County must be planning under the Growth Management Act.
REET I dollars must be spent solely on capital projects that are listed in the capital
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facilities plan element of their comprehensive plan. Those include public works projects
of a local government for planning, acquisition, construction, reconstruction, repair,
replacement, rehabilitation, or improvement of streets; roads; highways; sidewalks; street
and road lighting systems; parks; recreational facilities; law enforcement facilities; fire
protection facilities;trails; libraries; and administrative and judicial facilities.
REET II dollars must be spent on public works projects in the capital facilities plan element
of their comprehensive plan such as planning, acquisition, construction, reconstruction,
repair, replacement, rehabilitation, or improvement of streets, roads, highways, sidewalks,
street and road lighting systems, traffic signals, bridges, domestic water systems, storm
and sanitary sewer systems, and planning, construction, reconstruction, repair,
rehabilitation, or improvement of parks.
XIV. FUND BALANCE
1) Classification
Mason County fund balances are classified by reserved or unreserved.
The Department of Community Development's permit fee revenues and expenditures will be
analyzed by the Financial Services Department at least annually to ensure resources are property
used.
2) Minimum Level
Maintenance of an adequate fund balance for the General fund to ensure sufficient
resources for cash flow and to mitigate revenue shortages or emergencies shall be a
priority.
The General fund's long-term fund balance target is a year-end unassigned fund balance
of 15-25% of annual expenditures, in accordance with the County's Financial Reserve
and Contingency Policy, Resolution 2021-034.
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