Shoshone County gets results of special review

WALLACE –– A recent report shows that Shoshone County may not be in as big of a financial hole as they once believed.  

Earlier this month, county officials received the final report from consulting firm Eide Bailly, who reviewed portions of the county’s financial statements from the previous three years to help them identify a reported $1.7 million in overspending.  

Last summer, as the county prepared its annual budget, there were reportedly several places where figures didn’t add up. This forced the county commissioners to ask the other departments to reassess their proposed budgets and make cuts where they could.  

After almost a million dollars in cuts and using funds from a recent property sale, the county was able to pass a budget, but the reported deficit was still hanging over the heads of the county officials.  

The results from Eide Bailly came just weeks after the county reviewed its annual audit, which had to be completed before Eide Bailly could conduct their review.  

During that time, both the commissioners and the county clerk made statements where they alleged that the county wasn’t in as bad of shape as they previously believed.  

The report from Eide Bailly showed breakdowns from sections of the county’s budget from 2021, 2022, and 2023 – with the 2023 portion covering both the county’s general and justice funds.   

In all three years, the budgeted amounts for expenditures in these funds were greater than the budgeted revenues. However, in terms of actual spending, none of the reviews showed any deficiencies except in the 2023 justice fund, which outspent its revenue by $451,165.   

Eide Bailly’s report pointed out a few things that stood out to them as they reviewed these financial statements. 

The first issue they pointed out is that the county’s expenses were not always categorized consistently from year to year, making it hard to compare and could affect future decision-making. The second problem they noticed was that budgeted amounts for income and expenses don't match up with the actual numbers from past years, making it difficult for the commissioners to make informed decisions on the budget. Finally, there were several different ways of calculating payroll are used across the county, which can cause confusion about what pay rate should be used for different types of employees. 

Specifically, the Shoshone County Sheriff’s Office, which operates on a separate pay matrix with funds that come out of the Justice Fund.  

According to the 2023 Fiscal Year report, the staff in the sheriff’s office saw wage increases between 10 and 15%. These increases were based on that updated wage matrix, which was approved based on estimated revenues that reportedly had not been received.  

Eide Bailly’s report offered the county some suggestions that they believe could help them avoid similar confusion in the future.  

To ensure consistency and better control of salary amounts, all funds and departments should use a unified salary matrix for various functions. The County should review the budget process to improve decision-making and can seek assistance from the Idaho Association of Counties for best practices. Additionally, the County needs to establish a policy on reserve and minimum fund balances, develop a 5-year capital expenditure plan, and enhance the monthly closing process for better financial decision-making. 

The good news is that Shoshone County appears to not be in a multi-million dollar hole, but this special report shows that the county is overestimating its revenue in regard to how it is spending.  

“The multi-million dollar hole was inaccurate,” Commissioner Tracy Casady said. “The economy and inflation have been insane since COVID. This left us with more expenses than revenue in some areas. Since we have been cutting back on expenses, it is better now, except for the sheriff’s department. Now that they have their own justice fund, they need to find revenue avenues to support their salaries and expenses.”  

The full report from Eide Bailly is on the Shoshone County website on the clerk’s page at www.shoshonecounty.id.gov.