Coeur d'Alene audit finds 'clean' opinion; council questions large change in custodial credit risk

The Coeur d'Alene City Council heard a presentation June 17 on the city's fiscal year 2024 financial statements and independent audit, which concluded with an unmodified — commonly called "clean" — opinion from auditors.

The audit presentation, delivered by Katie, finance staff, showed the city ended FY24 with a $19,000,000 general fund balance and an unassigned fund balance of $12,000,000, equal to about 22% of general revenues. Katie said the auditors also issued a report on internal controls and that the city was determined to be a low-risk auditee.

Why it matters: the audit summarizes the city's financial position and internal control review, information city officials use when setting next year’s budget and evaluating bond-market readiness.

Council members asked several detailed questions. Councilmember (and presenter of the Juneteenth proclamation) Dan English questioned a large change in a line item the audit labels "custodial credit risk," which jumped from about $500,000 the prior year to about $13,500,000 in the current report. Katie said Idaho law restricts local governments' permitted investments and that the line item requires follow-up; she offered to dig into and explain the change and to add clearer disclosure language in next year's report.

The presentation listed a number of one-time or nonoperating receipts in FY24 that affected fund balances. Katie identified a $1,570,000 settlement from ICRMP related to a police department storage fire and a $1,185,000 land transfer reimbursement from Ignite; she described the latter as a repayment of a loan the general fund had made for a land purchase. Katie also said the city recognized ARPA revenues as allowable expenditures were completed.

The city’s two largest proprietary funds showed mixed results: the water fund had a $118,000 (about 2%) revenue decrease and operating costs up roughly $324,000, while the wastewater fund’s operating revenue rose by about $640,000 and operating expenses rose about $731,000. Katie said the wastewater result aligns with the ongoing rate study and capital projects plan.

Councilmember [last name not provided] pressed for more detail on the audit's note listing lease income (note 5), which lists various leases but not all; Katie said she would follow up with the auditors, Alpine Summit, for clarification on disclosure thresholds.

No formal council action was taken at the meeting on the audit. Staff said they would follow up with supplemental explanations for the custodial credit risk line and lease disclosures and incorporate clearer language in future reports.

Supporting details: Katie said the city meets Idaho state statute requirements for annual audits and that the Government Finance Officers Association's guidance places the city's unassigned fund balance within recommended ranges (Katie reported roughly 75–80 days of operating coverage depending on the metric used). She also noted a $830,000 property tax increase and that several FY24 revenue increases were one-time in nature.

Councilmembers congratulated staff on the clean audit and signaled that additional detail on expenditure increases and fund composition will be part of the upcoming budget discussions.

The presentation concluded with staff taking questions and offering to provide follow-up materials to the council.