Curtis Averette of the accounting firm William L. Stark and Company presented the comprehensive annual financial report for the City of Henderson to the FAIR Committee yesterday.
According to Averette, the City enjoyed an increase in its general fund balance of 8.98% in fiscal 2005 to 15.26% in 2006.
Of that 15.26%, which represents $1,987,682, only a portion can be used by the City for any purpose. $570,582 represents drug seizure or public safety funds, which may only be spent for police, crime prevention, or purposes which fall within related Federal guidelines. $608,230 of the fund balance is in the form of Powell Bill funds which may only be used for street and/or sidewalk maintenance and repair. The balance of the general fund, $808,870, may be employed by the City for any legitimate purpose.
In fiscal 2005, the amount of funds in the general balance was $822,402, or 6.28% of the total budget, with only $22,268 in unrestricted funds. North Carolina’s Local Government Commission mandates a fund balance between 8% and 24%.
A spreadsheet prepared by Assistant Finance Director Sandra Wilkerson comparing fiscal 2005 and 2006’s projected figures may be viewed here.
According to the summary prepared by Averette, municipalities in North Carolina with a population between 10,000 and 49,000 had an average fund balance of 36.92% with an average available (unrestricted) fund balance of $5,540,559. Although Henderson’s fund balance has more than doubled in the past year, it still has less than half the average fund balance of similarly-sized cities.
Averette’s summary also noted that municipalities of similar population to Henderson had a tax collection rate last year of 97.36%. It was noted that last year’s tax collection rate was 93.76%. The summary recommended that “…the City Council should express its discontent with Vance County concerning the current tax collection rate.”
The complete text of Averette’s summary may be viewed here.
It was expressed by Henderson City Council member Elissa Yount and City Manager Jerry Moss that if taxes were collected at the average rate of 97.36%, it would represent $200,000 or $.03 on the city tax rate.
Moss stressed to City Council members present his desire to build up City capital reserve funds. He stated that there is only $125,000 left in three funds where years ago there was significantly more. He told members that these funds need to be built up for emergencies and to provide monies for matching funds grants.
The City Manager also took an opportunity to compliment Sandra Wilkerson and the City’s Finance Department. He said that three people did “five or six jobs” in a period with many job vacancies in that department and accomplished the task of getting through the audit process.
It was agreed by FAIR Committee members that the group would ask that the audit be accepted at Monday’s City Council meeting.