Oak Park audit: outside auditors issue unmodified opinion as council reviews major capital funding

Oak Park’s external auditors delivered an unmodified opinion on the city’s 2025 financial statements as the council heard a layman’s review of the audit and a summary of the city’s finances.

Deputy Finance Director Carl Johnson walked council through year-end numbers, emphasizing the Hub Construction Fund and the new Community Center Construction Fund. "That project…is about 10 and a half million dollars," Carl Johnson said of the Event Hub; he told council about roughly $800,000 in Hub expenditures to date, about $4.5 million set aside and additional grant proceeds helping reach the project budget. Johnson said the city contributed larger-than-planned transfers from the general fund to the Hub — ultimately transferring about $1.3 million during the past fiscal year — and that those transfers produced a budget overage that auditors required the city to disclose.

City voters previously approved two millages tied to the community center. Johnson said the city issued the first round of bonds near the fiscal year end — roughly $9.7 million of the total $44 million authorized — and expects to issue the remaining series in the next fiscal year as construction and design progress.

Outside auditor Mike Rolka of Yo and Yo summarized the audit opinion and reporting items in straightforward terms. "What we have issued on these financial statements is called an unmodified opinion," Rolka said, calling that "the highest level of assurance you can receive on your financial statements." Rolka said the firm had two required communications: a disclosure of budget overages driven primarily by transfers to the Hub fund and a significant deficiency that resulted from an incorrect allocation between road and water line project costs in the prior year; the allocation has since been corrected.

Rolka also described new and upcoming governmental accounting standards, including GASB guidance that required a restatement related to compensated absences and forthcoming standards that will change how some budgetary variances and proprietary fund presentations are disclosed in financial statements.

Council members asked for clarifications about funding sources. When Mayor Pro Tem Julie Edgar asked whether the general fund dollars applied to the Hub were operating or a mixture of operating and capital-improvement funds, Johnson said they were a combination: operating dollars had been set aside in a Parks and Rec capital improvement fund and transferred into the Hub fund. Johnson said the city intentionally used grants and accumulated operating fund transfers to avoid external borrowing for the Hub and that, aside from the bond proceeds for the community center, the city expects to continue that approach where feasible.

The presentation also covered long-term liabilities and pensions. Johnson said the city's closed general-employee pension plan had roughly $38 million in liabilities and was about 57% funded; the auditors and staff noted the state’s minimum funding requirement of 60% and that the city is following actuarial recommendations to meet long-term targets.

The audit presentation concluded with staff and the auditors taking questions from council; after the discussion the council thanked staff for the clarity of the presentation. The council later approved related accounting items and moved on to remaining agenda business.