By Erin Smith
He said the audit is late this year for a number of reasons. Scott said those reasons have been addressed. He told the board there is someone available that can assist Town Clerk Kentrina Woods with the closing out of the books and posting of items for last fiscal year.
Scott said an issue for the board to address is that of a declining fund balance. He reminded the board that the majority of the future tax base growth for the town is the expansion of area industry. Scott told the board they also need to be mindful of controlling expenses and improving the town’s tax collection rate, which is at 92 percent compared to 90 percent the previous year. The statewide tax collection rate is 95 percent.
According to Scott, the audit reflects the town had cash in all funds of $1.4 million in 2014 and $1.42 million in 2016. The audit reflects the town had $762,000 in revenue in 2016 and $859,000 in expenditures for a deficit of $97,000. The town’s fund balance for the year was $775,000.
“When you look at the percentage of expenditures to the unassigned fund balance, that is 70 percent,” said Scott. The statewide average is 108 percent. Scott said by comparison to other towns the size of Clarkton, the town is 37 points below the state average. He said the Local Government Commission monitors that, but the town’s fund balance has not been dropping rapidly.
“If it gets too low or takes too big of a drop you will certainly start getting more attention from the Local Government Commission and possibly getting a management team to visit again and it will be a little more extensive and trying to do what they can do to help,” said Scott.
The Water account has $455,000 in revenue compared to $508,000 in 2014 and $437,000 in 2015. The account had expenditures of $512,000 last year which is lower than $586,000 the previous year but the account still had a deficit of $57,000 for the year, said Scott.
The available fund balance in the Water and Sewer fund is $4,189,000 and because it is a propriety fund it is not measured like a general fund is, said Scott. He said the available fund balance in the account is $116,000 and steadily declining.
Scott said the Local Government Commission monitors a town’s financial situation. He said Clarkton’s fund balance is not dropping rapidly, but it is declining. If the town’s fund balance drops below a certain level, the Local Government Commission will request a plan of action be submitted to them from the town. The plan of action must describe how the board plans to build up the town’s fund balance.
Town Attorney Cliff Hester said the drop in the fund balance for the town is due to two major capital projects the town board has undertaken in recent years. They are the installation of security cameras to monitor the town and work which was performed to the town hall building. He advised the board they may need to consider increasing water and sewer rates or increasing taxes when they begin to plan for next year’s budget.
In other business, the board held a closed session to discuss personnel matters. In open session, the board voted to grant town employee Angie Dorsett a leave of absence through August 31, 2017, and approved advertising the position.Share: