Tryon’s finances improving, audit saysPublished 12:15am Sunday, December 9, 2012
Deficit fund balances in 3 departments
Although the Town of Tryon finished fiscal year 2011-2012 with negative fund balances in three departments, the overall general fund balance increased to 15.67 percent, according to the 2012 audit report.
Tryon Town Council met Nov. 20 and heard from Melanie Starr, with Bowman, Pegg & Starr Certified Public Accountants regarding the town’s 2012 audit.
Starr said the town increased it fund balance by approximately $35,000 last year and the state Local Government Commission recommends that local governments keep between eight and 12 percent available in fund balance, or savings.
Starr also spoke of the fire department, Harmon Field and sanitation funds that are operating with a negative fund balancesß.
She said the fire department’s total expenses decreased by about $40,000 last year, but there’s still a fund balance deficit. Fund balance deficits occurred in the fire department of $10,481, the Harmon Field fund of $32,747 and the sanitation fund of $72,714, according to the audit report. The deficits were the cause of three findings for the town. The other two findings were for the town expending amounts of money in excess of the budget and for lacking technical expertise to draft or prepare the financial statements. Most small towns receive findings for not having appropriate financial employees.
The finding for money being expended that was not appropriated excesses in several departments and the town’s failure to amend the budget to cover those expenditures. The governing body fund was over budget by $666, administration by $$13,132, police by $53,531, parks by $3,053, the fire department by $13,164, Harmon Field by $23,184, water plant operations by $209,533, wastewater plant operations by $$10,188 and the sanitation fund by $$9,177, according to the audit report.
“G.S. 159-8(a) states that all monies received and expended by a local government or public authority shall be included in the budget ordinance,” states finding 11-1 in the audit report. “Town of Tryon expended amounts in excess of the amounts appropriated.”
Finding 11-3 states that state general statutes also require that individual funds should not maintain deficit fund balances.
The cause of the finding states that “Town of Tryon has not monitored the funds to ensure compliance and expenditures were spent in excess of appropriations,” in the fire department, Harmon Field and sanitation funds.
Auditors recommended that general statutes require that the governing body appropriate the full amount of the prior year’s fund deficits when adopting the budget ordinance for the subsequent year. Therefore, these deficits should be funded immediately by a budget amendment.”
The town’s planned corrective actions said the town agrees with the finding.
“Action will be taken to eliminate deficit fund balances as soon as possible.”
The audit states that the fire department deficit was caused as a result of increased costs related to the purchase of the new uniforms and equipment and that, “the town anticipates additional grant monies, new revenues and continued diligence in minimizing expenditures to restore a positive fund balance.”
The Harmon Field deficit fund balance was due to increased costs related to the purchase of the old Tryon Middle School with the town also anticipating additional grant monies and new revenues and minimizing expenditures to restore a positive fund balance.
The sanitation fund balance deficit was caused from increased costs including fuel and tipping charges, according to the audit report.
“The town anticipates increased charges for services and continued diligence in minimizing expenditures to restore a positive fund balance,” states the audit report.
The water/sewer fund had increased revenues of approximately $24,000 with expenditures down last fiscal year, Starr told council.
Tax collections for year-end 2012 included collecting 94.69 percent of property taxes and 84.68 of motor vehicle taxes, according to the audit.
Commissioner George Baker asked Starr if she could speak of the town’s ABC store financials. Starr said she did not have all the financials for the store from 2012 but is working on obtaining all the information.
Tryon’s ABC store has been closed since September due to lack of revenue with town officials indicating they want to reopen the store.