Monmouth City approves audited 06/30/2024 financial report; council hears positive second-quarter update

Monmouth City Council voted to approve the City of Monmouth 06/30/2024 audited financial report as presented Monday evening; the motion was made by Councilor Lopez and seconded by Councilor Oberst and approved by voice vote. The council also received the city's second-quarter FY 2024-25 financial report, which staff described as generally positive.

Auditor Peter Gaelser of Kunz Vasquez and Associates told the council that "the audited financials were very clean and very well organized" and that the city's independent opinion was unmodified. He said the report showed no material findings and noted two recurring items: timing and documentation of grant expenditures and a self-review step the auditors perform because staff do not prepare the entire 100-page financial report internally. "There was no findings or concerns related to that those monies," he said of the federal expenditures that triggered a single-audit this year.

Finance Director Susie Morrison told the council that overall revenues and expenditures are "on target" for the second quarter and that some variances reflect timing of receipts, such as marijuana tax and franchise fees. Morrison said the city collected $538,000 in interest earnings year to date and that capital spending is concentrated in public works (about 80% of projects by value), with power and light at 14% and general fund projects at 6%.

Council discussion probed two technical items in the audit. Councilor McKeel asked about the audit note that net position improved "in part due to the increase in payments and transfer from business like activities to the governmental activities." Gaelser and Morrison explained that transfers from enterprise funds (utilities) to governmental funds and increases in program revenues and general revenues together produced the change in net position. Gaelser pointed the council to line items showing a $2,500,000 transfer from utilities to governmental funds in the current year as one contributor, and he said program revenues increased about $300,000 while taxes and general revenues rose about $700,000.

There was no formal action on the second-quarter report; council received it for review and staff said a supplemental budget will be proposed later to account for certain capital and ARPA-funded purchases. Councilors asked staff to monitor marijuana tax receipts and to continue outreach about the public safety assistance program administered by Polk County Resource Center. Morrison noted she would present third-quarter results and budget projections later in the year.

Ending: The approved FY 2023-24 audit and the Q2 financial update keep the city on its planned budget timeline; staff will return with any needed supplemental budget requests and the council will review the third-quarter report when available.