BROWNSVILLE, Texas – By profession, former Cameron County Judge Carlos Cascos is a certified public accountant.
In this capacity, he and his firm advise clients to maintain at least 60 to 90 days of operating reserves, in case of emergency.
Cascos says this is very important for municipalities, many of whom are expecting to see sales tax revenues plummet due to the negative impact the coronavirus is having on the economy.
On a posting on Facebook, Cascos had some advice for city leaders.
“For all our public officials, keep an eye out for the days of operations of your respective local governments. Maintaining an adequate rainy-day fund is just as important as keeping taxes low & expending taxpayer funds with efficiency and effectiveness.”
Brownsville Mayor Trey Mendez said Cascos is right to highlight the issue. Before becoming mayor, Mendez was a trustee on the board of Texas Southmost College (TSC).
“Great advice Judge. As you know, we followed this at TSC, and now, I am a big advocate for fund balance reserves. I think the city currently has approximately 80-plus days. Fiscal conservatism is always best,” Mendez said, in a response to Cascos on Facebook.
Cascos replied: “Good job (Mayor Mendez). When I first became County Judge, we had less than 30 days of operations, when I left we had about 88 days.”
In addition to serving as Cameron County judge, Cascos was the 110th Secretary of State for Texas. A Republican, he was born in Matamoros and attended the University of Texas at Austin where he earned a BA.
“As we trek through COVID-19 crisis, our personal, social and business protocols have changed and will have to change into the foreseeable future,” Cascos said. “We can control for the most part, our personal and social behavior, but can businesses and/or local governments influence or control how they operate and provide services?”
Cascos pointed out that his firm’s primary audit clients are governmental bodies or non-profits.
“Regardless of the type of audit and aside from the numerous audit standards we must follow, my firm has long focused and emphasized the importance of unrestricted reserves (a rainy day fund) and informed all our clients what their days of operations are at the end of each of their fiscal years.”
Cascos said his firm has numerous clients that have in excess of 90 days of operational reserves, which help to mitigate layoffs and reductions in services during a crisis period.
“We also have numerous clients that are dangerously below 30 days of operations. Why is this more relevant today? Simple. We hear of local governments furloughing or laying off employees, cutting services or now even considering raising taxes,” Cascos wrote on Facebook.
“Our recommendation to clients is to maintain at least 60 to 90 days of operating reserves, to avoid these issues should something happen, whether hurricanes, floods or other natural disasters, including pandemics.”
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