Should continued financial successes by the city of Mount Airy be shared with taxpayers?
That was the question Thursday night surrounding the presentation of an audit for the 2012-2013 fiscal year showing that city government maintained a trend in recent times of adding to its “savings,” or available fund balance. It stood at $11.9 million as of June 30, when the fiscal year ended.
This was a gain of between $1.5 million and $1.6 million from the city’s $10.3 million fund balance at the close of the 2011-2012 budget year.
The fund balance was boosted by the municipality “keeping expenditures down drastically” during the last budget year, according to Matt Braswell of the Martin Starnes & Associates accounting firm. It has audited the city’s books for the past three years and again issued a clean opinion for the most recent one during Thursday night’s meeting of the Mount Airy Board of Commissioners.
“Your revenues outpaced expenditures by about $1.2 million,” Braswell said of the performance during the 2012-2013 period. The city produced general fund revenues of $11,973,190, which are separate from its water and sewer division, while spending $10,778,901.
Such money that is left over goes into the general fund balance available for appropriation, which builds from year to year. As of June 30, 2007, that fund was $4.1 million and grew to the $11.9 million level based on the most-recent audit, according to additional information from City Manager Barbara Jones.
With municipalities recommended to maintain a fund balance representing a certain percentage of their general fund expenditures for a budget year, the $11.9 million figure is 110 percent in Mount Airy’s case.
“How often do you see this kind of report?” Mayor Deborah Cochran asked Braswell, whose firm performs between 120 and 140 audits annually.
“It is quite rare,” Braswell answered. “Most of the time I have not seen an increase in the fund balance of that much.”
“I think Mount Airy is a model for financial stability,” the mayor added. “I think other cities, especially those who have filed for bankruptcy, would appreciate our situation here.”
Commissioner Jon Cawley said that although revenues have decreased, municipal services have been maintained.
“The fact we continue to put money in the bank every year, I don’t know where it comes from,” Cawley added. “When I look at the budget, I do not see excess.”
“Major” Tax Cut Sought
While the positive news in the audit was cause for much praise and back-patting Thursday night, it did present a double-edged sword: a suggestion that the municipality share its financial success with the citizens.
It came from Paul Eich, who made the suggestion during a public forum at the start of Thursday’s meeting, even before the annual audit report came. Eich anticipated correctly that the audit again would show about $1 million more going into the city’s general fund reserve, as has been the case in recent years.
But Eich reminded that it all belongs to the people.
“It’s not just general fund money,” the 2009 mayoral candidate said of revenues accumulated and allocated as city officials see fit, “but taxpayers’ money over and above what was spent.”
Eich said property taxes should be trimmed in response to the growing savings, more than the tax cuts that have averaged about 2 cents per $100 of assessed valuation annually in recent years.
“You claim you want to reduce taxes,” he said of a continuous pledge by Mount Airy leaders, “but they’re so high right now, you’ve got a slush fund built into it.” The city has a 52-cent tax rate this fiscal year.
Eich said with the city banking so much money, it can support a substantial tax reduction, such as 10 cents.
“I would ask you to consider a major tax cut, not just a penny or two.”
And this could be in the offing, based on a comment by Commissioner Scott Graham at the end of Thursday night’s meeting.
“We’ve got some money we could do some stuff with, and I think property taxes is probably at the top of the list,” Graham said.
Water Project OK’d
Also Thursday night, the city commissioners voted unanimously to award a contract to a local company, Steve Tate & Son, to extend a municipal water line to North Street.
Steve Tate & Son had submitted the lowest bid for the project among five companies, with the largest of $146,831 from Jimmy R. Lynch & Sons of Pilot Mountain. Two other Mount Airy companies also bid on the job along with one from Boonville.
The commissioners had voted in July to extend the 6-inch line, to correct a rare situation of an inner-city area lacking city water service. Although businesses had previously been located in the area of North Street in question, which is now vacant, no usable water line could be found there when property owner Dr. Dean Simmons sought to construct an office/warehouse building.
Officials say the project has a 60-day timetable and is expected to be completed in February, but maybe sooner. It could be done in four weeks or less if everything goes well, including the weather, city Public Services Director Jeff Boyles said.
Not only is the project seen as aiding Simmons’ plans to locate an existing family owned business in the new structure, officials have said it could bring further development along North Street. Also, water flow will be improved to inadequate hydrants in the immediate area.
The commissioners also gave their nod to a plan to donate one surplus vehicle in the police department and sell another.
Surry Community College will be the recipient of both cars, a 2010 Dodge Charger and a 2007 Ford Crown Victoria.
The board went along with a recommendation by Police Chief Dale Watson to donate the Ford to the college and to sell the Dodge to it for $5,000, which will be used for training purposes.
Watson said the deal with SCC reflects the fact that it “has been a great community partner in the area of law enforcement,” including providing training.
Reach Tom Joyce at 719-1924 or firstname.lastname@example.org.