City working to increase revenue

GLASGOW — Cave City officials are looking for ways to generate more revenue, whether it be contracting with a neighboring city for trash pickup service or extending the city limits after a accruing a spending deficit of more than $100,000 in the last fiscal year.

They had already considered these items prior to Monday night’s city council meeting, which was when auditor David Gilbert presented them with the city’s 2009-10 audit report.

The report showed the city spent more money than it took in during the 2009-10 fiscal year.

The city started the fiscal year with a fund balance of $151,860, but ended with a fund of $46,184.

“Obviously that indicates the financial condition of the city has deteriorated this year,” he said. “I wanted you all to be aware of that. Obviously you could not have another year like you did last year, because your fund balance is down to $46,000.”

Gilbert also pointed out three findings he discovered in auditing the city’s financial records.

“The first two are repetitious from the prior year,” he said. “Every year we have to tell you all that you do not have on staff someone who is able to create this financial document including footnotes. That is a limitation that every small organization has, because every small organization does not have a CPA on staff to create that [document].”

He continued that auditors are required by auditing standards to tell city officials to report that finding every year.

The second finding involved several areas where the city exceeded its budget.

“According to KRS [Kentucky Revised Statute] we need to tell you about that,” he said. “In about every one of the funds you all went over budget. Obviously, the goal is to keep your expenditures under budget.”

The third finding involved several instances where the city failed to pay its bills within a 30-day time frame.

“You all had several instances where the money wasn’t there,” he said. “That obviously is the main concern, I know, for you all is getting to the budget to balance. So, if there is sufficient funds, the bills can timely be paid, but that wasn’t a situation that you could quite get done this past year with your financial condition.”

Despite the city being over budget and not paying its bills on time, Gilbert gave the city an unqualified opinion, which is the best opinion an auditor can give a government agency, he said.

After the council meeting, mayor Bob Hunt said he felt the city of Cave City was in better financial shape than a lot of states and other cities.

“We’re not as well off as we could be, but at least we’re in the black right now. I feel like that’s a plus in this economy,” he said. “The audit showed last year was a little bit better than this year as far as the fund balance, but the economy didn’t hit bad until this year. I think that played a big role in the revenue going down.”

The small year end fund balance can be attributed to a loss of revenues, including payroll taxes and occupational licenses.

“If you’ve got a lot of people employed, you’re going to generate a lot of money,” Hunt said. “The less employment you have, the less [revenue] you’re going to have.”

He gave a report during the meeting about Park City officials’ interest in working with Cave City to receive trash pick up, as well as the use of Cave City’s chipper to clean up debris and mulch fallen tree limbs.

The council gave its permission to city attorney Bobby Richardson to create an inter-local agreement regarding the partnership between the two cities.

Councilman Gary Hogan, chairman of the council’s finance committee, pointed out the city has been paying back a $40,000 debt it accrued when it borrowed money last year to fund the purchase of a slightly used garbage truck and fire truck.

“We have retired over half of that debt and have paid the note up and will pay the rest of it up probably before the next meeting,” Hogan said.

The newly purchased garbage truck replaced 70 large dumpsters the city had purchased for residents and businesses to use.

In addition to offering trash pick-up service to the city of Park City, Hogan said he and councilwoman Carol Ford are “very aggressively trying to annex more tax paying citizens and businesses to the city. We’ve got a campaign we’re starting pretty soon.”

The annexation is expected to generate more property tax revenue for the city to help ease it’s financial crisis.

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