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Town auditor reports strong reserves, OPEB liability and control issues in FY24 audit presentation
Summary
The town auditor told the Select Board on May 14 that Nantucket’s reserves remain strong, OPEB liabilities total roughly $115 million with 6% prefunding, and several operational controls should be tightened including inventory tracking and Chapter 90 reimbursements.
Tony Roselli, partner at Roselli, Clark & Associates, presented the Town of Nantucket’s fiscal year 2024 audit to the Select Board on May 14 and summarized the town’s financial position and several recommendations for internal controls and reporting.
Roselli highlighted that the town’s combined reserves (stabilization fund plus undesignated general fund balance) have risen in recent years and noted Nantucket’s triple‑A bond rating with Moody’s. "When you add those two numbers up, you have the reserve balances," Roselli said, describing a multi‑year trend of strengthened reserves.
The auditor also reviewed long‑term liabilities and recommended continued attention to other post‑employment benefits (OPEB). Roselli reported an OPEB liability of approximately $115 million at the end of FY24, with plan assets funding roughly 6% of that liability. He recommended that the town continue contribution strategies and noted pension funding for Barnstable is stronger and could in the future free resources to address OPEB.
The audit identified several operational control issues and recommendations: better perpetual inventory tracking for the water department (inventory previously counted and reconciled by auditors), cleanup and filing of Chapter 90 state reimbursement claims that had accumulated to about $1.21 million, and review of "stagnant balances" in special revenue and grant funds that had built up to several million dollars and warranted departmental reconciliation.
Roselli also flagged cybersecurity vigilance, noted improved investment returns (about $6.4 million in interest income for 2024 compared with prior year), and summarized that the town remains in a strong financial position while recommending periodic housekeeping and controls.
Why it matters: The auditor’s report provides a public, independent assessment of municipal finances, offering assurance on reserves and debt capacity while identifying control areas that affect financial accuracy and recovery of state reimbursements.
Next steps: Finance staff and department heads were advised to implement quarterly inventory reconciliations, pursue Chapter 90 reimbursements and review special revenue fund balances; staff said many of these actions are underway.
