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Smithville auditors report one-time grants boosted utility surplus; board approves $1M CDBG application
Summary
An independent audit presented to the Smithville board showed a $1.4 million increase in the water and sewer funds net position largely driven by grants; the board voted to approve Resolution 2026 a to apply for up to $1,000,000 in Community Development Block Grant funds for sewer and water work.
John Gould, CPA, told the Smithville board that the city closed the fiscal year with modest surpluses but that those results were influenced heavily by one-time grant awards.
Gould, the contracted auditor, said the water and sewer fund showed a $1.4 million increase in net position but that about $1.28 million of that figure came from grants. "You can see it's a huge number, dollars 1,400,000.0," Gould said, and he noted that without the grant funding the utility fund would show an approximate $200,000 surplus. He described the general fund as essentially balanced, reporting a net change in fund balance of roughly $4,000.
The Mayor asked whether a large planned upgrade at the citys water plant, which the board discussed could cost between $1.7 million and $2 million, would be feasible without raising rates. Gould said he had not run detailed projections for that specific project but cautioned that "anytime you spend $2,000,000 ... there's always the possibility down the road that you may ... have to look at rates," while also noting the utility fund does have reserves.
Following the audit presentation, the board considered Resolution 2026 a to apply to the Tennessee Department of Economic and Community Development for Community Development Block Grant (CDBG) funds. The resolution, as read aloud to the board, states Smithville is eligible for a maximum grant of $1,000,000 for construction and $420,000 for equipment under the CDBG program, including available scoring bonuses.
Danny Washer moved to approve Resolution 2026 a; Shawn Jacobs seconded. The board approved the resolution by voice vote. The Mayor announced, "Resolution passes." The application is intended to support construction and equipment for sewer and water projects; additional project details and funding matches were not specified in the meeting record.
The board also approved the January 5 meeting minutes (motion by Bess Chandler; second by Donnie Crook) and then recognized city staff for emergency work during recent weather; a member identified as David publicly thanked the police, fire and electric utility personnel.
What happens next: the resolution authorizes staff to submit the CDBG application. The board did not vote on any specific construction contract or appropriate project funds during the meeting; any decision to award contracts or change utility rates would require future board action and additional fiscal analysis.
