Spencerport Mayor Joyce Lobene says the village will comply with recommendations in a State Comptroller’s audit of the village’s financial management practices and is grateful for the assistance of the Office of the State Comptroller in the process.
“We intend to follow what they recommend,” Mayor Lobene told the Suburban News. “Any advice coming from outside people can be very helpful to any government,” she says. “We are doing what they are encouraging us to do.”
The audit – released September 13 – was critical of the Village Board for consistently underestimating revenues and overestimating expenses in village budgets over the past five years.
“As a result, although the board appropriated $3.73 million in fund balance for the general and sewer funds, over $2.9 million of this amount was not used,” the audit states. “Consequently, the village has accumulated excessive unexpected surplus funds amounting to $833,139 and $522,373 in the general and sewer funds (or 43 and 52 percent of expenditures), respectively.”
Auditors said that maintaining a substantial fund balance in addition to budgeting very conservatively results in a higher tax levy than necessary.
The audit states that the Village Board should develop and implement a formal comprehensive long term plan to guide its budgeting decisions.
“This will help the Board effectively use and reduce the fund balances in the general and sewer funds in a manner that benefits taxpayers,” auditors said. “Such uses could include … paying off debt, increasing necessary reserves, financing one-time expenditures, or reducing property taxes.”
Mayor Lobene explained that when she was first elected to office in 2009, village finances were not in good shape.
A new treasurer was hired and the village began to utilize conservative budgeting practices to help turn things around.
“We were really trying to get us in good shape,” Mayor Lobene says. “We tightened our belt and now we are in good shape. We don’t have to keep adding to those accounts.”
She noted that the village has come in under the state mandated two percent tax cap the past two years and that there were no concerns or complaints voiced by residents during this year’s budget hearing.
“We’ve worked hard. We did what we had to do to get the village finances in A-1 shape,” Lobene said. “The new treasurer has helped us a great deal.”
In addition to developing a long-term financial plan, the audit recommends the Village Board adopt policies or procedures to govern budgeting practices and the level of fund balance to be maintained for each fund; and to adopt budgets with realistic estimates of revenues and expenditures and the amount of fund balance to be used to fund operations.
“The Board must make responsible decisions to adopt and monitor more structurally sound budgets that include realistic estimates of revenues, expenditures, and fund balance that will be available and actually used to fund operations,” auditors said. “This will help to ensure the Village maintains reasonable fund balance levels and does not levy more property taxes than necessary to fund annual operations.”
In her written response to auditors, Mayor Lobene stated the Village Board will formulate a Corrective Action Plan (CAP) in the upcoming weeks.
“The intention of our Board is to apply the OSC recommendations to supplement our existing planning documents by developing a more formalized, comprehensive long-term capital and operating expenses strategic plan, and by considering the recommendations and resulting strategic plan in the 2014-2015 and future budgeting process,” she wrote.
9/29/13
