Finance committee recommends internal control, grant and debt policy updates; backs bond reallocation and IDB interlocal

The finance committee of the Board of Mayor and Aldermen recommended several financial-policy updates and a bond reallocation during its meeting, and asked staff for follow-up analysis on debt capacity.

Ms. Holden, the city finance staff member who led the presentations, told the committee the fiscal 2025 audit has not yet been published because auditors requested additional information late last week and staff returned the requested documents. "We do not have an audit published at this point in time," she said, adding that an internal quality-control review — which she estimated takes about two weeks — would be the final step before publication.

On budget monitoring, Holden said FY26 financials were distributed ahead of the meeting and the sales-tax numbers would be updated on the dashboard after the meeting. She described overall financials as "looking pretty good," noting a strong Christmas sales-tax intake.

The committee approved two changes to the internal control manual aimed at preventing payroll delays: allowing the city administrator to designate a delegate to approve payroll when absent and enabling directors to designate delegates for approving time sheets. After discussion the committee voted to recommend the revised manual to the full Board of Mayor and Aldermen.

Holden also reviewed a new section in the grant-management policy that creates administrative approval thresholds for certain awards. The thresholds include time-sensitive applications that would otherwise miss deadlines, awards that are 100% grant-funded, and total grant awards under $200,000 that do not create ongoing financial obligations. She said any grant that would create continuing obligations — for example hiring that extends beyond the grant period — would still come to BOMA for approval.

On debt management, Holden said she restructured the policy into three separate 'buckets' to reflect different funds: the 18.75 bond fund (dedicated to capital projects), the general fund (a guideline of roughly 15% of expenditures across governmental funds), and the water and sewer enterprise fund (no fixed cap at present but with a requirement that rates support debt payments and cash flow). Alderman Fuqua pressed the idea of including an explicit percentage cap (suggesting 85% as an example), and Holden said a fixed cap is possible but might constrain capital funds over the long term; the policy retains the requirement that a fund must demonstrate the ability to service debt before borrowing.

The committee also endorsed a staff request to reallocate bond proceeds from the 2024 bond package so that the CSA site plan would come out of the existing $11,000,000 in '24 bond funds and specifically from $18.75 bond funds. Holden said roughly $6,500,000 was identified for that purpose as part of the capital plan.

Members supported moving forward with a draft interlocal agreement with the Industrial Development Board to have city finance staff provide services to the IDB (including handling TIF and PILOT agreements and accounting for related collections). Under the draft agreement the IDB would reimburse or otherwise offset general-fund costs for services it receives; staff will take the draft to the IDB for review before placing it on a voting agenda.

Alderman Fuqua requested staff provide, within 30 days, a clear calculation of the 18.75 fund's current borrowing capacity; he referenced a dashboard figure of 22.43 percent and asked staff to email the precise number and bring it back to the committee. Mr. Allen, speaking from the floor, notified the group that the wrong version of a contract (Resolution 2683) had been placed on the consent agenda and asked that it be pulled for correction and moved to new business with corrected copies distributed.

The committee made motions to recommend the internal-control manual changes, the debt-management language, the bond reallocation and the IDB interlocal agreement to the full Board of Mayor and Aldermen; motions were seconded and recorded as approved in the meeting record. The meeting adjourned at approximately 5:23 p.m.

Next steps: staff will (1) finalize and publish the FY25 audit after completing quality control, (2) update sales-tax figures on the dashboard, (3) provide a written calculation of borrowing capacity for the 18.75 fund ahead of the next meeting, and (4) take the IDB interlocal draft to the IDB for review and return the corrected contract version to be placed on new business.