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Auditors report $5.2 million town surplus; recommend stronger fixed‑asset and contract controls
Summary
Auditors gave Boonton an unqualified opinion for 2024, reporting a $5.2 million current‑fund surplus and large utility surpluses; they recommended improved fixed‑asset records, cooperative‑purchasing documentation, and tighter change‑order controls, and council approved related audit resolutions.
Auditors told the Boonton mayor and town council that the town closed its 2024 current fund with a $5.2 million surplus — roughly 30% of the town’s operating budget — and that water and sewer utilities also finished the year with large surpluses.
"You have an unqualified opinion with respect to the financial statements for the 12‑month period," said auditor Neil Lurch during the council meeting. He said the town earned about $475,000 in interest on cash deposits and that the water utility closed with about $2.5 million and the sewer utility with about $1.7 million in surplus.
The auditor said those results and strong liquidity help explain Boonton’s AA credit profile and lower borrowing costs. "On any metric we measure, you would get a very strong rating," he said, estimating roughly 10–50 basis points of borrowing savings between rating bands.
Why it matters: large reserve balances reduce near‑term pressure on the tax levy and lower the town’s cost of borrowing for capital projects, but auditors flagged governance and reporting weaknesses to address.
Recommendations and council response
Lurch outlined three primary recommendations: (1) establish and maintain a fixed‑asset inventory to comply with the local finance board directive, (2) document cooperative purchasing agreements to ensure vendor eligibility under co‑op contracts, and (3) strengthen controls and documentation around major change orders on construction contracts. He said the administration and CFO had discussed maintaining records internally, which would satisfy the recommendation.
Administrator Neil Henry and the town’s CFO acknowledged the findings during the exit conference; council members asked how frequently fixed‑asset records should be updated and whether an internal program would satisfy future audits. The auditor said establishing an internal baseline promptly would resolve that recommendation.
Council action
Following the presentation, the council approved resolution 25‑223 certifying compliance with the Division of Local Government Services and resolution 25‑224 forwarding the corrective action plan addressing the auditor’s items. Both resolutions passed on roll call votes of the members present.
Next steps
The council instructed staff to proceed with the corrective action plan and to report back through the appropriate committees on implementation timelines. The auditor recommended that fixed‑asset and contract documentation steps be completed promptly to reduce repeat findings in next year’s audit.
(Article provenance: auditor presentation and Q&A, SEG 337–SEG 675; audit resolution and corrective action vote, SEG 676–SEG 732.)
