Pictured are members of the Chautauqua County Legislature. P-J photo by Gregory Bacon

Chautauqua County’s Financial Management Policy had given lawmakers leeway on how much or how little the county should have in reserves.

A new updated policy is more specific on what that percent should be.

On Wednesday, the legislature voted 14-6 to update its Financial Management Policy, with only Republican support.

The biggest topic of discussion was that the new policy recommends a 12.5% reserve fund.

The old policy recommended a reserve of somewhere between 5% and 15%, but didn’t specify an amount.

Last year during budget discussions, it was stated the county’s reserves were at 13.9%.

In an interview with The Post-Journal/OBSERVER in December, state Comptroller Thomas P. DiNapoli said the 5-15% range was “appropriate” but declined to give a further recommended amount.

On Wednesday, Legislator Fred Larson, D-Jamestown, called the reserves a “slush fund,” noting there are no legal restrictions on the money.

“It’s not a reserve fund for roads or bridges. It’s not a reserve fund for our buildings. it’s not a reserve fund for building a new jail someday. It’s a slush fund because we can use it for anything. Not that anybody in this legislature would ever do this, but we could raise our pay by 67% and pay for it out of the fund balance,” he said, taking a veiled shot at the Republicans who voted to increase their pay earlier this year.

Larson proposed two different amendments to the financial policy resolution. One amendment called for removing the 12.5% recommended reserve amount. Of the 19 legislators, only eight voted in favor. They were the five Democratic legislators — Larson, Susan Parker of Fredonia, Tom Nelson of Jamestown, and Bob Bankoski and Marcus Buchanan, both of Dunkirk — along with Republican Legislators Fred Johnson of Westfield, Jamie Gustafson of Lakewood, and Marty Proctor of Mina.

After that amendment failed, Larson proposed changing the 12.5% to 10%, saying that is the middle of the current policy’s 5-15%. That proposal also failed with only Johnson joining the five Democratic legislators in opposition.

Before the vote, Johnson joked about how he found himself agreeing with Larson.

“Partly seriously, and partly humorously, it chaps me to find a Democrat more fiscally conservative than I,” he said.

During the discussion Wednesday night, county Finance Director Kitty Crow said she proposed the 12.5% after reviewing other counties’ financial policies. Some policies had reserves higher than 15%, some were the same as Chautauqua County’s, and at least one had a goal of 12.5% reserves.

Crow said examples of needing reserves include if sales tax revenue goals are off or if there’s an emergency.

In the end, she said it was up to the county lawmakers to determine if they support her recommendation or not. “If it needs to be amended, that’s fine. It was merely a recommendation,” she said.

Legislator Terry Niebel, R-Sheridan, noted when he was first elected, the county’s reserve funds were below 5%. He said he doesn’t mind the 12.5% goal, adding that it’s not a requirement.

“If this body wants to set a target amount, I don’t care. It’s nothing that’s written in stone. … It’s nothing that we absolutely have to abide to,” he said.

Gustafson added that reserve funds protect the county taxpayers.

“No one is really talking about the fact that, number one, the county is earning interest on this money that is lessening the tax burden and, number two, if we were to have to go and borrow money for the mid-year … the interest rate environment that we’re in right now would would be detrimental to our taxpayers. So whether we have a fund balance target of 10 or 12.5%, we have to have a healthy fund balance in cases of emergency,” she said.

When the vote came, all 14 Republican legislators voted in favor and all five Democrats voted against it.

There were other changes as well, one of which recommended the county not use reserve funds for ongoing expenses.

In 2023, the Democratic caucus proposed using $1 million of the county’s reserves to lower taxes. That proposal was defeated.

During committee discussions the week before, Legislator Bob Scudder, R-Fredonia, asked Crow if the new policy would be opposed to proposals like that.

Crow replied, “I would say this is not prohibiting you from doing that. It’s not binding language in here. It’s recommending how the fund balance should be used.”