To the editor:
I read portions of an article authored by Mr. Jerry Kidd in the June 19 edition of the Lafollette Press (“Making up lost revenues”) wherein Mr. Kidd states that Campbell County Government is $96 million in debt. The official audit report of Campbell County as performed by the State Division of County Audit demonstrates that the total outstanding indebtedness of Campbell County amounted to $53,662,761 ($687,499 + $43,650,000 + $9,325,262) as of June 30, 2013. Additionally, assuming Mr. Kidd meant to reflect the total future debt service payments to be made in association with retirement of the $53,662,761 outstanding debt amount, inclusive of payments for both the principal balance along with interest payments, the correct amount of future debt service payments (principal and interest) amounts to $78,447,836 ($765,656 + $66,981,165 + $10,701,015).
As you can see Mr. Kidd’s assertion that Campbell County is $96 million in debt is more than slightly incorrect.
He is either overstating the amount of outstanding debt by $42,337,239 ($96,000,000 less $53,662,761) if his $96,000,000 amount is intended to represent the outstanding principal amount, or he is overstating the amount of future debt service payments (principal and interest) by $17,552,164 ($96 million less $78,447,836) if his $96 million is intended to represent the amount of future debt service payments (principal and interest).
Furthermore, the amounts as of June 30, 2013 have now been reduced by the payments made during the current fiscal year, which ends on June 30, 2014.
The payment amounts for the year ending June 30, 2014 are also reflected in the attached document.
Specifically, the principal payments for the year ending June 30, 2014 amount to $2,300,375 ($166,667 + $720,000 + $1,413,708) and the interest payments amount to $2,306,080 ($26,016 + $1,881,626 + $398,438). As such the outstanding principal amounts to $51,362,386 ($53,662,761 less $2,300,375) as of June 30, 2014 and the future debt service payments (principal and interest) amounts to $76,141,756 ($78,447,836 less $2,306,080) as of June 30, 2014 making Mr. Kidd’s asserted $96 million amount even that much more incorrect such that Mr. Kidd is overstating the county’s debt by either $44,637,614 ($96 million less $51,362,386), or $19,858,244 ($96,000,000 less $76,141,756) depending upon whether his $96 million amount intends to represent the outstanding principal amount or the future debt service payments (principal and interest).
In regards to the future debt service payments in the amount of $76,141,756 (principal and interest), $27,952,954 of this amount is provided for by education funds which must be made available to the school system whether these funds are spent for debt payments or some other purpose, and $4,375,741 is provided for directly from the federal government as part of the Build America Bonds Initiative created through the Stimulus Program established by Congress a couple of years ago. As such, the net amount of future debt service payments which relate to county funding amounts to $43,813,061 ($76,141,756 less $27,952,954 less $4,375,741) which is $52,186,939 ($96 million less $43,813,061) less than the $96 million asserted by Mr. Kidd.
Campbell County Director of Finance