City auditor reports clean opinion and finds no ARPA compliance issues

Colby Jensen, director with audit firm Forbus Mazars, told the Pavilion City Council on March 17 that the city's financial statements for the year ending Sept. 30, 2025, received an unmodified, or "clean," auditor's opinion. "On page 11 of that document, you will see the independent auditor's report stating that there's a clean or unmodified opinion," Jensen said.

Jensen said the city expended about $3.8 million in federal awards during the year and that auditors subjected roughly $3.6 million of American Rescue Plan Act (ARPA) funds to a federal single-audit for compliance. "We issued an opinion on the compliance over those ARPA dollars and again nothing to report," Jensen said, adding auditors found no material instances of noncompliance.

Jensen highlighted other fiscal items in the management discussion and analysis, noting net debt rose by just over $2 million after the city issued nearly $9 million for a police renovation project. He also said sales-tax-related incentive liabilities reported to the state have declined versus the prior year and that building-permit and emergency medical-service revenues came in above projections, reflecting local growth.

Council members thanked Jensen and city staff for the report and noted the audit ad hoc committee had already reviewed the materials. The mayor said the full audit report and the city's comprehensive financial report will be published on the city website for public review.

Next steps: the council received the audit and took no formal action at the meeting; the report will be posted online for public inspection.