Valley’s Auditors Praise City Financial Position

on November 9, 2015

The firm gave the city an unqualified, or clean, audit for the second consecutive year. That's the best audit that can be received.

In a Thursday evening work session, the Valley City Council heard a review of the recently completed audit for fiscal year 2014 and discussed budget priorities for FY 2016. Auditors John Boles and Ruth Blessing of Himmelwright, Huguley & Boles, LLC, Auburn, talked to Mayor Leonard Riley, members of the council and city department heads about the city's finances for the period beginning on Oct. 1, 2013 and ending Sept. 30, 2014. "We continue to be pleased with a turnaround we see," said Boles. "It's really, really impressive. We didn't see this several years ago." The firm gave the city an unqualified, or clean, audit for the second consecutive year. That's the best audit that can be received.

The city made a $2.2 million profit in FY 2014. According to the audit, Valley needed to bring in $6 million to cover its costs and brought in $8.2 million. It had a net ending position of approximately $13 million. That does not mean the city has $13 million in the bank, but it does indicate the city is very healthy financially. Two factors are in play here. The city is bringing in more revenue than it was a few years ago and at the same time has reduced its expenses. In FY 2014, for example, municipal expenses were down some 19 percent over the previous year. Some refinancing and consolidating emergency communications with Chambers County E-911 helped with this.

There's also some good news with solid waste. The city made a $55,000 profit on this in 2014. "That's much better than what we'd seen lately," Blessing said. "The city has lost money on this in the past." "There's definitely been some improvement made here," Boles said. A total of $30,460 more in cash came in over that period than had come in over the previous fiscal year. "There are a lot of positives from the financial point of view," Blessing continued. "There's very good news in the $2.2 million profit. Paying for the ballpark renovations with cash helped with this." Mayor Riley reminded council members that the Sportsplex renovation project extended over two years. There will be some carryover of that in the audit for 2015. There will also be a principal of approximately $500,000 for a bond issue, something that will extend over a four-year period.

"This is a good audit. It's unqualified with no findings," Riley said. "We've just about met all the goals we set when we came into office (in 2012). We still want to improve our credit rating to triple A." The mayor said much credit for this needs to go to the department heads. "They have to stay in budget every day for us to stay on track," he said. While an audit for recently completed 2015 won't be in for some time, Riley thinks that will be a good report as well. "We spent a lot, but we got a lot accomplished," he said. "We paid cash for the Sportsplex and for the paving we did. We ended the year with our reserve intact."

City Clerk/Treasurer Regina Glaze reviewed 2015 in some detail. "Our revenue was really good," she said. "We projected a budget of $9.6 million and collected $9.8 million." The numbers were up across the board pretty much in every category except for beer sales. Sales tax collections were up, despite falling fuel prices motor fuel taxes were up, and the city had a record year for collections on business licenses — $1,118,000. Motor vehicle taxes were the best they'd been in four years. Rental fees collected by the city were up, EMS collections were up some $84,600 from the previous year and memberships at Valley Community Center showed an increase of around $43,000. Most city departments came in under budget at the end of FY 2015. Valley Parks and Recreation was slightly over budget but that should change on Monday. A budget amendment on the agenda for Monday's council meeting will put the department back under their budget for the end of the fiscal year. The city departments will see slight increases in their budgets for next year. Mayor Riley said there are some changes in the budget from what was talked about at a work session in July. This includes some salary increases for city employees, some adjustments made for health insurance costs, costs relating putting in new lighting on Valley's side of Exit 77 off I-85 and the expected cost for a city election next August.

When everything is totaled, personnel will cost the city a little over $4.4 million in 2016. The city was caught off guard by having to make two insurance payments in October. This was due to switching to a new type of health coverage. One payment was for around $67,000 and another for $57,000. A two-step increase for police officers will see the new ones making over $14 an hour. "That's much better than it was a few years ago," the mayor said. "Hopefully that will do what we want it to, help keep our officers here and not leaving for other departments that had been offering better pay." The city currently has 20 people drawing retirement pay. The city is OK on this as long as it's funded at over 80 percent. Right now it's 91.4 percent. It got close to the 80 percent mark following the 2008 economic crash but is in better shape now. If it ever drops below 80 percent the state won't fund that amount; the city has to pick it up.

Mayor Riley expressed some concern about paving bids coming in higher than expected. In its capital improvements budget, the city had set aside $300,000 to resurface the portion of Columbus Road at McGinty's Crossing to the south side city limits. The lowest bid came in at $365,000. It's been negotiated down from that, but it's still over budget. That project should be completed by Dec. 1.

Two more paving projects will be taking place in FY 2016. If these bids are up as well, it might be necessary to find ways to cut back on the costs or move one of them to the next year. "It will be an excellent year if we can do the projects we've planned and stay in budget," Riley said. "We'll update this as we move along."

Mayor Riley asked Police Chief Tommy Weldon to talk about a new drug dog that's going to be in the schools. Chief Weldon said that "Goose" had been purchased by the Drug Task Force earlier this year. The cost of the dog, plus training and some needed equipment, comes to around $12,000. Some of this cost is covered by forfeiture money. Officer Lawrence Howell has undergone several weeks of training in the use of a drug dog. "We're excited about having a K-9 in service," Chief Weldon said. Some of the new equipment includes a "hot dog" system. This keeps the dog from getting too hot when he's in the back of an SUV. The windows will automatically roll down a bit to keep it cool back there.

Riley said the merry go round should arrive by mid November and should be ready for its annual holiday season run by the latter part of the month. City employees and their families will be able to ride it on Employee Night, which will be taking place on Nov. 30. The carousel opens to the public on Friday, Dec. 4.

Qualifying for the upcoming city election will be taking place in July with the election taking place on Aug. 23.

"We've just gotten a really good audit," Mayor Riley said. "We want them to keep getting better and better and better. We've maintained a reserve of $2.8 million while getting a lot accomplished. I appreciate your support. Working together, we have accomplished some good things for the city."

(Article By WAYNE CLARK Times-News News Editor)

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