The County Clerk’s Cost Fund, established by Act 1765 of 2003, has not been the topic of as much discussion as other cost funds or automation funds – because as a general rule the County Clerk’s office does not generate as much revenue. No Attorney General Opinions have been issued concerning the County Clerk Cost Fund – and there have been no court cases involving this fund as of late 2011.

Although this fund is probably handled differently from county to county – here is what the law says concerning the County Clerk’s Cost Fund.  

Fees collected by the County Clerk pursuant to A.C.A. 21-6-413, 21-6-415 and 16-20-407 are to be paid into the county treasury to the credit of the “county clerk’s cost fund”.  In strict accordance with the law 100% of these fees are to be credited to the fund – even though only 35% of the fees are restricted and considered “special revenues”.   

Many counties probably credit 35% of the fees to the County Clerk’s Cost Fund and 65% of the fees to County General.  To be in full compliance with the law 100% of the fees should be credited to the County Clerk’s Cost Fund with 65% then transferred to County General as an appropriated transfer or the 65% can actually be appropriated and expended from the County Clerk’s Cost Fund for “any legitimate county purpose.”

A.C.A. 21-6-413(e)(1)(A) says that the county clerk fees “shall be paid into the county treasury to the credit of the fund to be known as the county clerk’s cost fund.”  The law goes on to say in subsection (e)(1)(B) that “with the exception of those funds referred to in subdivision (e)(2) of this section, all funds deposited into the county clerk’s cost fund are general revenues of the county and may be used for any legitimate county purpose.”

The funds referred to in subdivision (e)(2) are the 35% “special revenue” funds.  These funds, in accordance with A.C.A. 21-6-413(e)(2)(A)(B) “shall be used to purchase, maintain, and operate an automated records system.  The acquisition and update of software for the automated records system shall be a permitted use of these funds.”

Normally “special revenues” or “restricted funds” are just that – they can be used only for the purposes set out in law…..unless there is an exception laid out in the law.  In this case the exception is espoused in A.C.A. 21-6-413(e)(2)(C) which says, “Funds set aside for automation may be allowed to accumulate from year to year or at the discretion of the clerk may be transferred to the county general fund by a budgeted appropriated transfer.

Special Notes concerning the County Clerk’s Cost Fund:

1. In those counties having combined offices of county clerk and circuit clerk/recorder or in those counties having combined offices of county clerk and recorder, the clerk must decide to utilize the county clerk’s cost fund as authorized by A.C.A. 21-6-413 or the county recorder’s cost fund as established by A.C.A. 21-6-306.
2. The clerk’s decision must be made in writing and filed in the office of the circuit clerk. 
3. The clerk is not allowed to use both funds – except for the revenue generated under A.C.A. 16-20-407(b). [The $2.00 kept locally from a $13.00 additional marriage license fee.]
4. In the case of a dual clerk who has chosen the County Recorder’s Cost Fund as their “automation fund” of choice – he or she will still have a County Clerk’s Cost Fund specifically and only for the $2.00 they retain from the $13.00 additional marriage license fee levied under A.C.A. 16-20-407.  This money (the $2.00 retained from the $13.00 additional marriage license fee) MUST be appropriated and expended exclusively for the operation of the office of county clerk [A.C.A. 16-20-407(b)(1)].