MAYVILLE - The Chautauqua County Home will deplete its fund balance and run out of cash by the end of 2013 without financial assistance, according to projections released by the Dunkirk skilled nursing facility.
The news, though, is hardly surprising to some county officials.
The financial report was commissioned last month by the legislature's Audit and Control Committee after a resolution to appropriate $500,000 from the county's fund balance to match a federal grant was drafted.
The intergovernmental transfer could provide the County Home with a multi-million dollar revenue stream, and is dependent on a local share payment from Chautauqua County.
The committee and legislature voted to table the resolution until the projection report could be drafted.
The report, obtained by The Post-Journal, shows the County Home will run a projected deficit of $3.7 million this year. The home is also expected to use all but $1.6 million of its fund balance, which stood at $5.3 million last year.
County Home officials stressed the fund balance and cash flow projections are rough estimates and are subject to change.
County Executive Greg Edwards has shown interest in making the IGT payment, and noted that he had the line item in his 2012 budget before the legislature nixed it during budget negotiations.
"None of this surprises me," Edwards said Monday of the home's financial state. "I've been doing these projections for years so I had IGT in my budget.
"The County Home will be out of cash; it operates at a negative every year. We were fortunate due to smart financial planning to get IGT funding" in the past.
During last month's legislature meeting, several legislators voiced support for the local share payment. Lawmakers tasked the home with developing a projection model to determine how much could be secured through the matching grant. IGT options were included in the home's financial report.
"I continue to believe it makes sound financial sense to support IGT funding for the County Home," said Minority Leader Lori Cornell, D-Jamestown. "Whether one supports or opposes its potential sale, it is important to make the County Home as financial viable as possible going into the future."
"This is an interesting balancing act," added George Borrello, R-Irving. "Funding the IGT makes sense. We know there is going to be a deficit."
Borrello said without the financial assistance, taxpayers would be forced to subsidize the cost of the home. Therefore, he said, any funding options would be a smart move for the county.
"At this point, the taxpayers will have to subsidize that," he said. "Taking the politics out of it, it makes sense on paper. With it, it becomes muddy, and I don't want any part of that."
If the minimum amount were sought, the County Home could receive a $1.3 million payment, according to the report; a $1 million local share contribution would net a $2.6 million return, while a maximum investment of $1.38 million from the county would bring in $3.6 million.
Without the local share payment, the home will lose a half-million dollars in its cash accounts this year alone. Without further IGT funding, that number balloons to $4 million in losses in 2013, $8 million in 2014 and $12 million in 2015, through early projections.
"This affirms everything I've been telling people," Edwards said. "This loses money in increasing amounts. Even with the maximum IGT amount, it still loses more money than it takes in."
As a result, Edwards said, county taxpayers have footed the bill to support the County Home.
"Taxpayers have to support the County Home as long as the county is the owner," he said.
The home has been marketed for sale or lease by the firm Marcus & Millichap. Last month, the real-estate group collected its last bid for the Dunkirk facility, and Edwards said Monday he is still currently reviewing those offers.
The financial report will be discussed during an upcoming Audit and Control Committee meeting later this month.
The resolution to appropriate a portion of the county's fund balance for the IGT payment is expected to be taken off the table and voted on by the legislature.
An amendment to increase the appropriation amount, or a new resolution altogether, may also take place during the legislature's May 23 meeting.