Government and public entities use their reserve accounts, sometimes called rainy day funds, for a variety of reasons.

Some organizations have that money on hand for emergencies. Others use reserve funds for upcoming projects that may need to be accomplished sooner than later.

Here's a look at the reserve fund accounts for Aiken County, the City of Aiken, the Aiken County School District and the state.

Aiken County

For the County, funds from the reserve accounts assist in the cost of operations before it generates a good chunk of its revenue through real property taxes that come in halfway through each fiscal year.

County Administrator Clay Killian said that, currently, the County has enough in the reserve account to cover operating expenses for five months if an emergency were to occur.

The total amount in the County's reserve funds is $143,740,287 but that amount is broken down into designated pots of money.

Some of those reserve funds are “restricted,” and require a super majority vote by Council, meaning those funds can't be touched without approval from six, rather than five, of the nine council members. Those funds can be used for such investments as incentive packages for companies willing to make big investments in the County.

For example, the County sold its Mattie C. Hall Health Care Center located on Highway 19 several years ago. The money generated from the sale was put in the County's reserve account, and later used for an approximately $11 million incentive package for Bridgestone, which included some road work and purchase of property.

Killian said that without those reserve accounts on hand, it would be hard to find incentive funds for what he called a “once-in-a-career type of investment.”

Killian said it's an action the County cannot take at this time until that money is replenished through Bridgestone's fee-in-lieu of taxes.

Monies from the reserve accounts also were advanced for Capital Project Sales Tax projects, such as the new County animal shelter and the new health department on Beaufort Street. Those funds are replenished as new money comes in.

City of Aiken

The City of Aiken has $27,723,471.56 in its reserve account. Those funds are broken down into different accounts and designated for specific purposes.

City Manager Richard Pearce cited the Capital Project Sales Tax accounts as one reason the City may dip into the reserve funds, which have been used in the past to accelerate a project before actually receiving that money. The City later reimburses itself when those funds come in.

For example, Council approved advancing $1 million in Capital Projects Sales Tax money for the new SPCA Albrecht Center for Animal Welfare. The City wanted to continue its partnership with the nonprofit and locate its animal services in the new shelter, but shovels were going to hit the dirt before the sales tax money was received.

Pearce said the City also has funds in the account saved for items it will need later, such as a new police cruiser.

For the City, the reserve funds are more about saving for the future. Pearce said it's wise to keep three to six months of operation expenses on hand, but that the municipality has been fortunate enough to rarely need to use those funds for emergencies over the years.

“The City of Aiken has historically tried to pay as we go. The last thing we want to do is go to Council and say they don't have the funds to meet budget,” Pearce said.

Aiken County School District

Around the time the unexpected, disastrous recession struck the U.S. about five years ago, the Aiken County School District had a reserve fund balance of $11 million.

This fiscal year, the district's fund balance is about $24 million. That increase in part was made possible by federal stimulus funds, which allowed the School Board to use other revenue sources to replenish the fund.

Some residents at times have questioned the need for such a large fund balance. School District staffers have cited one factor as the need to manage expenditures throughout the fiscal year – July 1 to June 30.

The district doesn't begin to receive significant revenue through county and state allocations until October and November. This year, the district is obtaining a Tax Anticipation Note of $2.6 million to cover payroll and other needs until the revenue begins to arrive.

The $24 million fund balance is considered, through accounting recommendations, a sufficient amount. About a decade ago, school districts throughout the state began experiencing mid-year cuts in state appropriations. The Aiken district had to resort to using some fund balance money to make up for lost revenue during that period of time.

The School Board also utilizes the account for one-time uses. Its members voted this spring to loan $265,000 to the North Augusta High School athletic booster club for a new scoreboard. The club's officers intend to repay the Aiken County School District within five years.

In the spring of 2012, the Board agreed to use $1.9 million from the fund balance for a new technology platform. That program, too, was a one-time expense.

The State of South Carolina

The State of South Carolina has two reserve funds, which total 7 percent of the general fund revenue from the most recently closed state fiscal year, 2011-12. According to information supplied by Rebecca Griggs, a governmental affairs analyst with the S.C. Budget & Control Board, these funds are known as the general reserve fund and the capital reserve fund, and both are constitutionally mandated.

Both funds are legally mandated to have a specific percentage of general-fund revenue from the most recently closed state fiscal year. The general reserve fund is required to have a balance of 5 percent, and has a fiscal year 2013-14 balance of $292,889,764. The Capital Reserve Fund is required to have a balance of 2 percent, and has a fiscal year 2013-14 balance of $117,155,905. The two funds combined have a total balance of $410,045,669.

Both rainy day or reserve funds are funded from the state's general fund, which primarily come from taxes (income, sales etc.). Both accounts are funded as a part of the state's budgetary process involving the governor and the legislature. After the new budget takes effect, the funds are transferred into the appropriate accounts.

The general reserve fund money can only be used to cover year-end operating deficits. The capital reserve fund can be used to cover year-end operating deficits and to replenish the general reserve fund. In any year the capital reserve fund isn't used in those situations, it can be used for the following: To finance, in cash, previously authorized capital improvement bond projects, to retire interest or principal on bonds previously issued, to fund capital improvements or for other nonrecurring purposes.

For example, in fiscal year 2007-08 and fiscal year 2008-09, the general reserve fund was used to cover year-end operating deficits. In fiscal year 2007-08 and fiscal year 2009-10, the capital reserve fund was used to cover operating deficits.