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Lincoln County audit shows clean opinion as revenues, fund balance rise
Summary
An external audit delivered an unmodified (clean) opinion for Lincoln County and reported revenue growth driven by a revaluation; commissioners discussed fund balance, sales tax caution and spending priorities for upcoming budgets.
Brandy of Martin Starnes and Associates told the Board of Commissioners on Nov. 18 that the firm issued an unmodified opinion on the county’s financial statements — a clean audit.
The auditor said general fund revenues rose from about $147.1 million to $166.8 million, an increase of roughly $19.7 million (13.4%), and general fund expenditures increased about $10 million (7.8%). The county’s unassigned general fund balance increased to about $35.9 million, roughly an 8.7% rise from the prior year, the audit found. Brandy attributed a $16.7 million jump in property tax revenue primarily to a county revaluation effective July 1, 2023. "In the current year, we issued an unmodified opinion. That's a clean opinion," the auditor said.
Commissioners and staff discussed reserves and budgeting. County staff noted that ad valorem property taxes make up about 57% of the county’s revenue, sales taxes about 24%, and restricted intergovernmental revenue about 7%, and cautioned that sales tax is an unpredictable revenue source. Diana Rios, finance/utility staff, confirmed the county holds revenue bonds that impose reserve requirements for some enterprise funds and said the county’s quick ratios and unrestricted cash measures are well above typical thresholds for water, sewer and solid-waste funds.
Why it matters: The audit and the size of the unassigned fund balance influence the county’s policy on reserve levels, credit ratings and how the board prioritizes one-time and recurring spending in future budgets. Commissioners discussed that the board had previously targeted a 20% unassigned balance but can briefly drop that floor with a plan to restore it.
