Auditors issue clean opinion on Roseville's 2024 financial statements; council receives report

Auditors from Plante Moran reported Jan. 14 that they are issuing an unmodified (clean) opinion on the City of Roseville’s financial statements and its administration of major federal awards for the year ended June 30, 2024. The City Council voted to receive and file the audit.

Ali Hejazi, an audit partner with Plante Moran, told the council the clean opinion is the highest level of assurance and indicated the city’s financial statements were presented in accordance with accounting requirements. The auditors also issued a clean compliance opinion on the city’s administration of its major federal grant, which this year included ARPA funding.

Audit staff reported a roughly $12.1 million increase in total General Fund revenue from fiscal 2023 to 2024, largely reflecting ARPA receipts that rose from about $68,000 to about $7.7 million. The auditors said property taxes remain the single largest revenue source for the General Fund (nearly half of general fund revenues) while state and federal grants accounted for slightly more than a quarter. Total General Fund expenditures increased about $9 million year over year, with a significant portion of that increase driven by transfers to other funds, including an $8 million transfer to the capital projects fund for capital projects.

The audit showed the city’s unassigned General Fund balance rose by about $4.9 million to roughly $12 million (about 27% of expenditures) and that personnel costs accounted for roughly 80% of General Fund expenditures, with police and fire representing a large share of personnel allocations. Reported pension and OPEB funding levels were: city employee retirement system about 72% funded, police and fire system about 60% funded, and retiree health care plan about 22% funded. Combined unfunded pension and OPEB liabilities were reported around $134 million.

Auditors and staff discussed that state law (Public Act 202) requires corrective action plans for retirement-related plans that fall below certain funding thresholds; auditors advised the council to continue monitoring funding levels and strategies. After the presentation, Councilman Knox moved and Councilman Leticia seconded a motion to receive and file the audit. The motion passed by voice vote.