The annual audit was presented at the April City Council
meeting. The audit showed we were in
good shape as we received a very favorable outcome. On the revenue side we saw a positive
variance of $76,990 in revenues. The
largest portion of the variance was in funds granted to the city by the state
for road improvements. This was not
budgeted as it was appropriated after the final budget was adopted. Other significant positive variances were
property taxes and special assessment revenues.
These increases were likely due to delinquent property taxes being
paid.
On the expenditure side of the budget we had a positive
variance of $114,231. This is the result
of under spending the budgeted amounts.
The largest variance here was funds that were budgeted for road
improvements. We had anticipated a
larger project than what was approved for completion. Another large variance was in public works
for future equipment purchases.
With the city having only one debt service instrument, the
debt of the city has been decreased substantially. Other good news about debt was the collection
of past due amounts that were collected in taxes. Rather than run somewhat in deficit with a
historical collection rate of about 93%, we collected amounts in excess of
those budgeted and certified. This
resulted in a positive variance of $8,916.
Our ability to manage expenses rests in the annual budget
and levy but also in an account created to address long term and large
expenses. This account is called the
Revolving Capital Fund. Within this fund
we have assigned revenues for future use by category or department. Each year we deposit or spend funds in this
account as they are budgeted and are available.
This fund grew $339,273 this past year.
The majority of this increase were from funds made available for road
improvements that went unspent this year to be used in future years.
All said the balance for the city general fund at year end
was $1,098,546. With the policy to
maintain an undesignated fund balance at 45% of the following years budget it
results in a “surplus” that can be assigned to the Future Improvement line item
in the Revolving Capital Fund. With this
transfer the fund balance is increased by $191,903.
The sewer fund was also audited with good results. Operating revenues and disbursements showed a
positive fund balance of $151,729.
Non-operating revenues show an additional income of $125,590. All told the balance of the sewer fund is
$3,184,543. This balance positions us
well for the future expansion of the wastewater treatment faculties when the
time comes. This allows us to continue
to keep user rates low by anticipating the future.
The auditors were able to give the city an unqualified opinion
on the regulatory basis of accounting. That’s
a good thing! It’s nice to have a great outcome but it’s also nice to get your
auditors blessings.
