- Special Sections
- Public Notices
Finances are looking better for the city of Springfield, according to auditor and certified public accountant Danny Hardin. He spoke at the city council meeting on Jan. 10.
“Things are a little bit better, but we still feel uneasy,” he said. “The city has taken a lot of steps to improve, and watch over things. So, we want to ask you to continue a vigilant effort to keep expenses under control, and to make sure all the taxes are collected and managed also.”
Hardin presented the results of his audit that looked at the fiscal year ending on June 30, 2011.
Last year, Mayor Dr. John Cecconi appointed a committee of three council members, Paul Borders, Lisa Haydon and Debbie Wakefield, to consider finances in a troubled economy.
Hardin said he was pleased with the results of the budgetary committee.
“I’ve seen some positive results from it, and I hope that we will continue having council people involved, and looking for savings, and anything that can reduce cost, and at the same time manage the money properly to provide the proper services,” he said.
Cuts were made last year, with a shift in some departments toward using seasonal employees instead of full-time employees.
Hardin touched on the rising cost of fringe benefits during the city council meeting.
“I know first-hand people whose fringe benefits are costing them a whole lot more this year than in previous years,” he said. “So every city has the same problems. No one is exempt from it.”
Hardin said that the city was still benefitting from the tourism tax, which has proved to be a great revenue-raiser, he said.
He added that he was encouraged by some of the things that happened in 2011, including the annexation of the St. Catharine property into the city.
Hardin said that property taxes, occupational taxes, insurance and franchise taxes levied all increased in the last fiscal year.
He said he was most encouraged by the increasing occupational tax.
“That was the one that was up the most, so that’s encouraging that jobs were better and people were making more money this past year compared to the year before,” he said.
Hardin said he was pleased with the economic state of the city.
“Overall, more money is coming in,” he said. “We’re going to have a few more expenses also, but everything is holding, so I am encouraged about the economy.”
Last year, Hardin reported that the net change in account balance of the general fund should be considered net income for the city.
In last fiscal year report, that number was $42,000. The year before it was $180,000. For the most recently ended fiscal year, the number was minus $37,524.
General fund revenues were $3,041,531 for the most recent audit, up from $2,223,696 in 2010. Expenditures also rose, totaling $3,079,055 in June 2011 and $2,181,266 in June 2010.
“When you look at the bottom line, the bottom line does not always reflect the cash flow,” Hardin said. “In the expenses we do have depreciation, and it’s large amounts of money that we’ll cover later.”
City administrator said via email on Monday that a $1.2 million grant (East High Street redevelopment) also skews the bottom line.
He added that while the city saw a loss, the water and sewer company saw a $253,000 gain.
The audit report noted that general fund debt increased by $137,315 in the last fiscal year. The money was used to buy police cruisers. The water and sewer systems borrowed $44,896, according to the audit report.
Hardin noted that the city owes $318,000 in long-term debt, while the water and sewer company owes $7.5 million in long-term debt.
He also said the city spent $626,000 in federal money last fiscal year, most of which was spent on the East High Street redevelopment project.
“Springfield has been very fortunate in their funding from the federal and state government,” he said. “Many people would not have water today probably if it hadn’t been for the funding that we’ve had.”
Hardin said that financial statements change drastically each fiscal year.
“Expenses go up, some go down,” he said. “The same way with the income. Just because you have more money doesn’t mean you have any more in the bank. In your case, we do have.”
He said that depreciation for the city was $209,000.
“So that’s how you can show a loss on the bottom line, but still have more cash and more assets,” he said.
Depreciation for the water board was $747,000, he said.
“A lot of their things like the water plant, incoming water lines, your outgoing water lines, they’re set up on 40 to 50 years,” he said. “It’s just a huge amount of money to depreciate.”
In the “management discussion and analysis” section of the audit report, which is written by city employees, tourism is discussed.
“Currently, a Lincoln Legacy museum is slated to open in the spring of 2012,” it states. A Phil Simms museum committee is working on this venture to highlight the lifetime achievements of the Super Bowl champion. The Children and Community Theatre is continuing its momentum.”
The report also notes that two grant applications for the Robertson building are “underway now to restore and reuse the facility in a way to provide for more commerce and economic development opportunities.”
Caution is also expressed in the section of the report.
“City officials must continue to closely monitor their economic standing,” the report states. “Guarding the city’s certificate of deposit for emergencies and a ‘rainy day fund’ is important. To this end, city officials should consider reinstating their financial review committee to monitor progress, consider additional cost-saving measures and weigh-in on long-term growth planning.”
The report also listed topics the committee, should it be reinstated, could review in order to achieve the city’s financial goals.
Those items include: review areas that can be annexed, release deed restrictions to sell the pool property and get releases to sell the landfill property, consider an increase in the property tax rate, consider increasing the insurance premiums tax rate, review franchise taxes and agreements with utilities, education on the benefits of buying locally, review current services to see if and how Springfield can become more ‘college-friendly’ and work with fie officials on the lease agreement proposed for the new fire facility.
Smith notified the council that the city had been approached by an anonymous donor about a donation of public art. She said the donation was coming in the next few days or weeks. The city had not received the donation as of Monday.
She noted that the donation was revenue neutral to the city, and that art could possibly hang in the judicial center.
All members of the council were in attendance. The next regular scheduled meeting is Feb. 14 at City Hall.