Cave Creek receives clean audit; council hears FY2024–25 financial report highlighting capital spending and Phoenix interconnect costs

Auditors told the Cave Creek Town Council on Jan. 20 that the town’s fiscal year 2024–25 financial statements received an unmodified, or clean, opinion and that testing revealed no material weaknesses in internal control.

Richard Gillespie, senior manager with Advicent, reviewed the audit scope and timeline and said the audit—performed under generally accepted auditing standards—produced a clean opinion and no corrected misstatements. He said auditors found no reportable internal-control deficiencies and no other noncompliance matters.

Town finance staff presented highlights from the annual comprehensive financial report. Governmental funds expenditures increased by $2.2 million to $17.5 million in fiscal 2025, a 14% rise driven largely by capital spending: about $1.4 million in streets maintenance and roughly $1.1 million for fleet acquisitions, including water tender trucks and a fire engine. Revenues in governmental funds rose about $1.0 million (6%), primarily from construction-related sales tax.

Fund balances decreased by about $5.4 million (15%), primarily because of one-time capital projects and subsidies: the general fund supported wastewater and Cave Creek Water with subsidies that totaled roughly $2.4 million to the Cave Creek Water fund. The unassigned fund balance was reported at about $8.0 million, with $5.2 million held as operating reserves. The finance presenter said the ending general fund balance finished at about $28.7 million versus a budgeted estimate of $23.6 million.

On utilities and projects, the presenter said ARPA (COVID-relief) funds of roughly $1.9 million were recognized and used toward the Phoenix interconnect project; an additional $2.0 million in congressionally directed funding will also go to that project. WIFA loan draws increased long-term obligations; the town reported debt-coverage ratios of about 2.95 for Desert Hills and 3.47 for Cave Creek (the latter figure reflected a $2.4 million general-fund subsidy).

Council members asked several questions about grant recognition, the composition of construction activity driving sales-tax increases and why $8.0 million of CIP budget capacity was not spent in FY25. Finance staff said timing, project startup scheduling and staff capacity explained much of the unspent CIP and noted that some grants are one-time receipts that are recognized when eligible costs are incurred.

That procedural business item: the council approved the Dec. 2, 2025 regular meeting minutes by voice vote, announced as a 7–0 approval.