Independent auditors give Clinton a clean opinion; city hears midyear finance update and approves budget amendments

Clinton's independent auditors delivered a clean opinion on the city's 2024 financial statements and reported two audit findings, city officials said during the council meeting.

Scott (auditor) told the council the city's net position increased by about $4 million in 2024 and total revenues rose to roughly $29 million from $26.5 million the prior year, driven by stronger sales and property tax collections and a change in the school funding formula. The general fund's unassigned fund balance at year-end was reported at about $8.5 million, approximately 45% of annual expenditures.

In the auditors' report on internal controls, the auditors noted two issues: a duplicate payment of $85,000 on a construction invoice that city finance detected and recovered, and an overspending of roughly $3,000 in the drug enforcement fund relative to budget. The auditors recommended stronger invoice controls (standardized invoice numbers and accounts-payable checks) and more frequent monitoring of fund-to-budget comparisons and timely budget amendments.

Council members asked about long-term risks and debt. Auditors said the majority of the city's debt is expected to be retired by fiscal 2026, when a large payment is due; remaining debt is modest through 2030, the auditor said.

City Finance Director Chris reported the city is about halfway through its fiscal year. Revenues collected equal about 41.2% of budget and expenditures are about 51–52% of budget, reflecting a recent one-time employee bonus and several capital outlays. Sales-tax collections were slightly up versus the prior year even after a state clawback, the director said.

Council approved two budget amendments during the meeting. The Board of Education's Budget Amendment No. 2, which includes a one-time staff bonus and grant-funded adjustments to federal projects and cafeteria accounts, passed on roll call. The city's Budget Amendment No. 1 primarily funded capital expenditures (including a Ridgeview calming/parking/traffic signal project) and added approximately $41,000 for separation pay; funding sources included assigned capital project funds, $4,400,750 in grant reimbursement, and roughly $41,000 from unassigned fund balance. Council later voted to formally adopt budget amendment No. 1 after an initial discussion and confirmed it by voice vote.

Council also authorized staff to file for state and federal grants for building renovations, water and sewer improvements, drainage and infrastructure projects, vehicles, equipment and potential employee funding, consistent with prior practice.

The auditors provided additional detail on minor audit adjustments: a $35,000 change to accumulated depreciation and minor uncorrected misstatements related to timing of grant revenue recognition. The auditors did not report disagreements with management. City staff said they are working on implementing the auditors' recommendations.