Audit presented during Louisa City Council meeting

By TONY FYFFE

BSN Editor

LOUISA — The Louisa City Council was presented with the city’s 2019-2020 fiscal-year audit during a special meeting last Tuesday, March 16.

Reviewing the audit with council members, CPA Jim Bryant of Wells & Company said the “clean report” showed that total assets in the city’s general fund as of June 30, 2020, were $505,398 and that total cash was $265,559.

“Cash was down from $354,966 from the prior year, about $98,000,” Bryant said. “The mayor and I discussed this, and the main reason was the city paid $104,000 in cash for a rescue vehicle for the fire department.”

Bryant said the total liabilities were $2.4 million, which includes $1.4 million for pensions. He said there was an unrestricted deficit of $1 million, which us “all due to that pension liability.”

“But overall, your total net position of the city was a positive $725,000,” Bryant said.

Addressing revenue and expenditures, Bryant said the general fund had $1,796,176 in revenue as of June 30, 2020, which was “up some from the prior year.” Total expenditures were $1,885,137, which was an $88,961 deficiency of revenue over expenses, he said.

“Again, we can go back to the rescue truck,” he said.

Bryant said the general fund’s beginning balance was $431,000 and its ending balance was $393,099.

“The city is not running a deficit,” he said. “You did spend a little bit more than you brought in last year, but you had excess fund balances from prior years to carry over that you were able to use. So, you still have a positive fund balance in the city’s general fund.”

The city’s total water and sewer assets for the year were $22,874,000, Bryant said, with $21.9 million being capital assets, which include the water and sewer plants, equipment, vehicles and related items.

Total current assets for water and sewer were $959,543, which includes $281,591 in cash and cash equivalents, $390,794 in customer accounts receivable and $161,116 in unbilled receivables.

The total net position of water and sewer was $13,224,560, he said.

Water and sewer’s total revenues were $3,159,081, which was a $100,000 increase from the previous year, and its total operating expenses were $3,064,000.

Operating income was $94,416, which was done from $192,000 the prior year. Numerous repairs and maintenance at the water plant were “primarily the reason for your expenses being up last year,” Bryant said.

“Actually, you had an increase in your net position for the water and sewer of $676,000 last year,” he said.

Bryant added that this was the first time since he began doing the audit that the principle payments and interest payments due combined were $792,000.

“So, you generated $758,000, which was a little bit less than what was needed to cover your debt payment and so forth,” he said. “But it wasn’t really a problem because you’ve got cash in the bank. It wasn’t like you were having a problem meeting your payment.”

He blamed the difference on an increase in water and sewer delinquencies due to the COVID-19 pandemic.

“It wasn’t terrible by no means, but you typically in the past, ever since I did the audits, you always had enough cash generated from operations to meet those needs,” he said.