Another positive audit report for Fernandina Beach in FY 2015

Submitted by Suanne Z. Thamm
Reporter – News Analyst
April 7, 2016 1:19 p.m.

 

During the April 5, 2016 Regular Meeting of the Fernandina Beach City Commission (FBCC), Ryan Tucker of Purvis Gray and Company presented the Annual Audit Report for the last fiscal year. Tucker had previously reviewed the report with key city staff and commissioners. He provided an overview and highlights for benefit of the public and the FBCC. He said that the audit process went well and that it was “a very positive, clean report.” The city had a good year financially as well, he added. Federal and state single item audits also were positive. He said that the auditor’s unmodified opinion reflected the highest level of assurance that an outside auditing firm can provide.

All expenditures were within budget in every department.

Total revenues were up $3M over the previous year to $39.6M. Most of the increase was attributable to capital grants and contributions. He reported a $600K increase from franchise fees and taxes and $500K increase in building permit revenues.

Expenses totaled $33.1M compared to 34.8 in the previous year. He noted reduced expenses overall, but attributed much of the difference to litigation fees to settle the impact fee lawsuit and a drop in CDBG (Community Development Block Grant) activity.

The General Fund showed excess revenues over expenses by $700K. Accounting standards recommend that the city hold 2-3 months of expenditures reserve. The city improved its position in this regard and exceeds this amount by 32 percent.

Tucker reported on status of the following funds prior to city adjustments:

• Golf course – lost $344K
• Airport – lost $530K
• Sanitation – income exceeded break even by a small amount
• Water and Sewer – $2.5 income
• Stormwater – lost $5K
• Marina – $28K income

Tucker reminded commissioners that this was the first year with a new accounting requirement for pensions. Unfunded pension liabilities in previous years had been included, but in notes. The benchmark toward which the city should aim is 80 percent funded liability. Current city pensions are funded in the 64-67 percent range.

In summarizing his report, Tucker said that he had no compliance issues or internal control issues to report.

“Overall the audit went well,” Tucker said. “We appreciate all the work that Patti [Clifford, city comptroller] and her staff do to prepare for the audit. I would say they are in the top 5 percent of all the audits we perform, as far as getting ready for the audit.”

Commissioner Len Kreger expressed concern over the low level of pension funding. He asked if that matter would be discussed during the upcoming budget. City Manager Dale Martin replied, “Correct.”

Commissioners voted unanimously to accept the audit report.

Editor’s Note: Suanne Z. Thamm is a native of Chautauqua County, NY, who moved to Fernandina Beach from Alexandria,VA, in 1994. As a long time city resident and city watcher, she provides interesting insight into the many issues that impact our city. We are grateful for Suanne’s many contributions to the Fernandina Observer.