While the numbers were better than they've been in years, there is still need for improvement in many areas. That was the report from Kevin Wystup, an outside auditor from the Johnson Mackowiak & Associates, LLP, the accounting firm that performs the city of Dunkirk's annual outside audit.
The city finished its 2011 budget year with all three of its operating funds ending on the plus side of the ledger. Increases over the past few years in property tax, water and sewer rates, along with a higher-than-expected PILOT payment from NRG in 2011 helped the city's funding levels.
According to the report, the general fund had an operating surplus of $63,051 in 2011, compared to an operating deficit of $426,486 in 2010. The water fund had an operating surplus of $70,536 in 2011 versus an operating deficit of $320,328 in 2010. The wastewater treatment fund had an operating surplus of $489,003 in 2011 as opposed to a deficit of $335,202 in 2010.
The report shows costs going up in 2011 from 2010 for the police department ($5,033,000 - $4,774,000); fire department ($3,322,000 - $2,968,000); water department ($2,496,000 - $2,365,000); and wastewater treatment department ($3,209,000 - $2,442,000).
The report shows how adopted budgets can change over the course of a year.
In 2011, the original general fund budget was $14,394,184 while the final total was $15,262,100. In 2010, the budget started at $13,928,419 and ended at $14,519,375. Additional appropriations and encumbrance carryovers made up the differences in starting and ending figures.
The auditors also provided a list of suggested opportunities to strengthen the city's internal controls. Included in these are: reconcile bank accounts on a timely basis; eliminate unnecessary bank accounts; formalize accounts receivable procedures - reconciliations; formalize accounts receivable procedures - collections; taxes receivable should be reconciled monthly; formalize accounts receivable procedures - collections; taxes receivable should be reconciled monthly; improve timing of budget modifications; repay interfund loans.
In addition, the auditors called for eliminating deficit fund balances in the city's water and wastewater funds.
"Failure to eliminate these deficits will erode the city's financial stability and depending on the depth of the deficits, could force a going-concern disclosure in the audit opinion," the report stated.
Closing completed capital projects, updating the city's fixed asset inventory records and clarifying a lease agreement between the city and owners of the Stearns Building are also called for in the report.
Council's Finance Committee officially heard the report with Mayor Anthony J. Dolce, Fiscal Affairs Officer Harry Briggs and City Treasurer Mark Woods also in attendance. Council members had several questions and will bring more to the table in July when Finance Committee Chairman Michael Michalski is planning two meetings to work on the report and other areas of concern.
After the meeting, Dolce was asked for his thoughts on the report.
"I read through the whole audit and I just received the management letter this afternoon. We'll definitely take the time to review it, come up with the most cost-effective way to proceed and make their recommendations," he replied. "The point of all this is to ensure we're getting timely reports that can help us as soon as issues arise."
Dolce has seen eight or nine reports since he joined Common Council and was asked to compare this report to the others.
"These are somewhat of the reports I recall from when I first joined council. It's not all good, but there does appear to be some positive news," he replied. "My administration's job is to make sure that we proceed correctly and in a timely, cost-efficient manner."
Council's Economic Development Committee meets today at 11 a.m. in City Hall with more budget talk a possibility.
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