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Leesburg posts clean FY2025 audit, unassigned fund balance at 39%; council hears options for stormwater funding and budget tradeoffs
Summary
Finance staff presented the FY2025 Annual Comprehensive Financial Report showing a clean audit, no findings, an unassigned fund balance around 39% of expenditures, and $3.2M of data‑center money reserved; staff outlined pressures on recurring revenues and potential funding options for long‑term needs such as stormwater and collective bargaining.
Finance staff presented the town's Annual Comprehensive Financial Report for the fiscal year ended June 30, 2025. The presenter reported a clean audit opinion with no audit findings for the second consecutive year and highlighted an unassigned general fund balance of about 39% of expenditures (town policy target 20%), which staff described as providing flexibility for unexpected needs and special projects.
Staff highlighted one‑time and new revenue items affecting the year: the first distribution of data center revenue (approximately $3.2 million) was placed in a reserve as of June 30, 2025; annexation revenue also contributed to stronger results. The presenter said the change in total fund balance for the year was about $2.3 million and that the utilities fund cash position increased (cash on hand reported as about 1,079 days in that fund, with a net operating increase and a sizable capital plan).
Councilors asked about how an overage is treated, whether departments were under budget because of unfilled positions, treatment of compensated absences under new accounting guidance, and the timeline for federal compliance guidance. Diane Starkey (deputy director/controller, mentioned in the presentation) explained that new GASB guidance required including certain sick‑leave balances in compensated absences. The town attorney said collective bargaining numbers are expected to be incorporated into the budget submission if tentative agreements are reached; if there is an impasse, the town would include the last offer in the budget as a planning assumption.
Staff reiterated that long‑term sustainability choices (data‑center revenue allocation, potential stormwater fees, or tax rate changes) remain on the table and that council will consider options during the upcoming budget process.
