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Auditors give Martin County a clean opinion but flag water district balances and lack of reserves
Summary
Carr, Riggs & Ingram presented a clean FY 2018‑19 audit for Martin County while highlighting interfund receivables from two county water districts and noting neither district has reserves for future projects; commissioners pressed for clarification on historical accounting treatments.
Martin County’s independent auditor reported a clean opinion on the county’s FY 2018‑19 financial statements but highlighted accounting issues in two water districts that have relied on General Fund support for years.
Chris Burton of Carr, Riggs & Ingram told the Board of Commissioners on Jan. 8 that both water districts had been supplemented by the General Fund and showed receivables at year end: Water District 2 owed the General Fund $1,256,529 and Water District 1 owed $379,145. Burton also commended the county for establishing and maintaining an OPEB trust and noted a fund balance available of 26.84 percent and a tax collection rate of 95.18 percent.
Commissioner Ronnie Smith asked for clarification about an agreement from 1999 and subsequent accounting changes. Burton pointed the board to the CAFR notes explaining the 1999 Water System Management Agreement with the Town of Williamston and a similar 2005 agreement for District 2 that allocate a proportionate share of debt service to the town. Finance Director Cindy Ange explained that certain management fees had historically been treated as operating revenue when they should have been treated as capital lease activity; the classification was corrected in the current audit.
Vice Chairman Dempsey Bond Jr. said he was unhappy with the historical arrangement and worried town customers inside Williamston’s extraterritorial jurisdiction were not helping county finances. “Someone made a bad judgement twenty years ago with this project,” Bond said.
County Manager David Bone explained how joint projects and grant relationships commonly require the county to act as lead agency and that the accounting language needed adjustment to reflect those arrangements and remain in compliance with the Local Government Commission’s guidance. The audit presentation noted the matter was addressed with the Local Government Commission to ensure compliance.
No formal board action was taken beyond the audit presentation and associated questions; the auditors provided the CAFR and audit presentations to the board for review.
