Local finances show slight upturn

Auditors visited Madison, Mayodan and Stoneville town meetings in recent months to present reports on the budgets for the previous fiscal year. Although each report was unique, the overall picture for all three communities demonstrated a positive trend.

Madison

Madison’s Board of Aldermen was the first to receive a report as Eden CPA Rex Rouse delivered his analysis of the 2010-2011 financial statements Nov. 10. The good news came quickly, with the report of a significant increase in the town’s general fund balance, or savings. As of June 30, 2010, the fund balance had grown by more than $171,000 to $1,761,000.

Rouse said the total fund balance was approximately 65 percent of the town’s total budgeted expenses, which was very good. The amount of that fund balance which was not reserved for specific expenditures grew by approximately 11 percent over the previous year to 51 percent.

“The average statewide for towns the size of Madison is 35 percent, which places you well above the average for general fund balance,” Rouse said.

More good news for aldermen came in relation to water and sewer income. The town had been forced in previous years to transfer large amounts from the general fund balance to compensate for shortfalls in the water and sewer fund, which should be self-sufficient.

Rouse reported the 2010-2011 figures showed a net income of more than $13,000 in comparison with a loss of more than $280,000 during the previous year. A decrease of more than $285,000 in water and sewer expense helped generate the additional income, as well as an increase in water and sewer rates. The increased revenue allowed the town to transfer only $50,000 from the general fund to compensate, or more than $140,000 less than the previous year.

“Considering the loss from each of the last three years, this year we believe that the Board’s decision to increase by 5 percent the water and sewer rates for the year ended June 30, 2012 is appropriate,” Rouse said.

Madison’s total assets increased by $129,472 during 2010-2011, while the town’s total debt decreased by $260,096 or about 5 percent. The decrease in debt was primarily due to the retirement of long-term bonds and notes.

Stoneville

Manley Fortune, representing the Winston-Salem accounting firm of Cannon and Company, presented the Stoneville Town Council with its 2010-2011 audit report Dec. 6. Stoneville’s fund balance also increased, although still not up to the state-mandated level of 8 percent of expenses.

Fortune said the town’s ending fund balance on June 30, 2011 was $161,220, up more than $28,000 from the previous year. But that figure remained only 1.97 percent of budgeted expenses and far below the 35-percent average posted by other similar towns across the state.

“But it shows you are working toward that 8-percent goal,” Fortune said. “You’re moving in the right direction.”

Although the town’s water and sewer income grew for the fourth straight year, from $383, 574 in 2008 to $501,930, operating expenses also increased by nearly $100,00 to $559,352. While recent water and sewer rate increases had helped tighten the gap between income and expenditures, other factors elevated the losses in the water and sewer fund to nearly $280,000. That difference required a transfer of more than $70,000 from the general fund.

“The loss associated with the abandonment of the town’s old wastewater treatment plant accounted for $187,993 of the loss in the water and sewer fund for the year ended June 30, 2011,” Fortune said.

Fortune said Stoneville’s actual income in the general fund was $18,733 less than the budgeted amount and $8,573 below 2010 revenues. He indicated the decrease was primarily due to lower local option sales taxes and fire protection taxes.

Expenses also increased from the previous year’s budget, but ended the year below budgeted amounts. Fortune attributed those changes to increases in the police department’s capital outlay expenditures and public works road construction.

Mayodan

Rouse returned to western Rockingham County on Monday evening to deliver his audit report to the members of Mayodan’s Town Council.

Like Madison and Stoneville, Mayodan’s total fund balance grew during the previous fiscal year. Mayodan increased its savings by more than $240,000 to a total of $1,478,563. The available unassigned fund balance was up $134,000 to $848,244, or 39.34 percent of the town’s total budgeted expenses.

“That’s up from last year and still above the statewide average for towns your size,” Rouse said.

Rouse reported the town’s revenues were up from the previous year, as well as coming in above the budgeted totals. Actual expenses for 2010-2011 ended up $314,000 below the projected budget, but were still 7 percent above the previous year. Rouse said the increases in expenditures were primarily due to new police cars and additional FEMA expenses for the fire department.

Mayodan’s water and sewer revenues ended at $2,074,337, which was $14,880 lower than the previous year.

“That’s not really a significant amount on revenues of more than $2 million,” Rouse said.

He also said the town’s water and sewer operating expenses increased by $44,456, or about 2.51 percent above last year’s figures. But Rouse also said that change appeared insignificant.

“That’s less than the inflation rate,” Rouse said.

Mayodan’s total assets increased by more than $756,000 during the last fiscal year, with about 75 percent of that reflecting the town’s investment in capital assets like land, buildings, machinery and equipment. The town’s long-term debt decreased by $272,242 (6.1 percent) in 2010-2011, primarily due to the retirement of installment loan obligations.