Finance director flags $18 million Pioneer underbilling; council reviews enterprise fund statements
Loading...
Summary
City finance staff presented general and enterprise fund statements showing higher revenues and planned fund‑balance growth and reported an approximate $18 million underbilling claim against Pioneer; Pioneer disputes the figure and legal counsel is engaged.
Kayla, presenting the city's financial statements at the Nov. 11 workshop, said general fund revenues were at 114% of the original budget while expenditures were at about 77%, and she projected a general fund balance increase of about $21.2 million.
On the enterprise side, Kayla said she adjusted how capital projects were displayed after discovering $16,100,000 in CIP expenditures had been mixed into operations. She said, based on contract review and advice from city counsel and outside auditors, the city believes it underbilled Pioneer approximately $18,000,000 and that the amount was recognized in the fiscal‑year‑end statements with an offsetting allowance for doubtful accounts.
"In our opinion and opinions that we received from the attorney at the time... it does appear we underbilled Pioneer about approximately $18,000,000," Kayla said. She added that Pioneer disagrees and that attorneys are working on the matter, noting legal issues such as statutes of limitations may affect collection.
Kayla also said the water/sewer enterprise fund is estimated to increase by roughly $4,000,000 in fund balance but reminded council that enterprise funds roll CIP and reserves differently than the general fund; she said the reported $87,000,000 fund balance does not include the city’s preferred 3–6 months of reserve and she will begin including that figure in future reports.
Council members pressed for more detail on large line‑item shifts, water meter lease accounting (a $23,000,000 lease was cited as affecting comparisons) and overtime accounting in public safety. Staff said detailed line‑item narratives and supporting calculations are available and that adjustments will be made for clarity in future packets.
The presentation was informational; no formal council action was taken on the Pioneer dispute during the workshop. Staff said legal review and negotiations will continue.
