City auditors issue clean opinion for FY2023-24; one Urban Renewal finding noted

McMinnville's external auditors presented the city's comprehensive financial statements for the year ended June 30, 2024, and issued an unmodified ("clean") opinion dated Dec. 23, 2024. Tanya Moffett of Marina and Company told the City Council and Urban Renewal Agency that the audit covered the city's annual comprehensive financial report and the McMinnville Urban Renewal Agency financial statements for the period from July 1, 2023, through June 30, 2024.

The audit team applied limited procedures to the management discussion and analysis and certain required supplementary information, and found no restrictions on the audit, no significant difficulties, and no disagreements with management. "We completed our audit and issued an unmodified or clean opinion, which is the highest level of financial statement opinion that we can give," Moffett said.

The auditors identified one Oregon minimum standards compliance item: the Urban Renewal debt service fund exceeded appropriations by $2,599. Moffett said the over-expenditure is common when bills arrive after fiscal year-end and that the Secretary of State is notified but no further response was required because the finding was not deemed material enough to demand a written response. Finance Director Katie Henry and staff confirmed the item will be reported and tracked; Heather (staff member) explained the specific overrun related to late invoices for hazardous-material handling tied to the Northwest Rubber environmental work.

Councilors asked follow-up questions about specific line items identified in the statements, including how the city service charge is reported in "charges for services" on the fund-level statements and how Urban Renewal interest payments tied to a loan for the RB/Northwest Rubber project appear in the debt service line. Moffett explained large estimate items in the statements, including depreciation, compensated absences and the net pension liability provided by Oregon PERS, and said the city's 2023 and 2024 statements are comparable on an "apples-to-apples" basis because no new accounting policies were adopted for 2024.

Moffett thanked city staff for cooperation during the audit and noted Marina and Company will perform the 2024-25 audit; the city will go out for audit bids for the 2025-26 audit year. City staff said any remaining questions from newer councilors can be answered outside the meeting or the acceptance of the statements will be scheduled for a later council meeting to allow time for follow-up.

The council did not take formal acceptance action during this session; staff said the item will return for acceptance at a later meeting after any follow-up questions are resolved.