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City audit: Chadron reports healthy reserves but general fund drawdown prompts caution
Summary
Auditor AMGLPC issued a clean opinion on Chadron's 2024'25 financials, noting decreased overall debt and strong cash in many funds, while flagging a general fund drawdown, segregation-of-duties limitations, and utility fund depreciation concerns.
Chadron's 2024'25 audit, presented by Michael Hobec of AMGLPC, received an unmodified opinion and shows a mixed picture: strong cash reserves in many funds and reduced outstanding debt, but a notable general fund decrease that officials say merits attention.
Hobec said the auditors issued an unmodified opinion, meaning the financial statements were presented fairly. He identified several major capital expenditures during the year: about $137,000 for ADA improvements at the plaza restroom, $38,000 for airport snow-removal equipment, $210,000 for a loader for the street department, and roughly $370,000 on street improvements.
The report lists total outstanding debt at $3,279,000 as of Sept. 30, 2025, down from $4,242,000 the prior year — a reduction of about $964,000 (roughly 22%). The general fund showed total assets just under $4.4 million, with about $3.7 million in cash, but recorded a $335,000 decrease in fund balance for the year.
Hobec also summarized management letters and 10 findings or suggestions. Among them: limited segregation of duties in finance operations (common in small municipalities) and timing issues with receipts and check-signature controls. "We're never going to get rid of that comment," Hobec said of segregation of duties, noting staffing limits for a city this size.
On benchmarking, Chadron compares to a peer group of cities with populations roughly between 3,000 and 10,000. Sales-tax revenue per capita performed well at $471 (above the peer average cited), while some per-capita spending categories (police, airport and pool) ran higher than averages. Utility fund analysis showed the water fund produced modest operating increases while the wastewater fund showed a depreciation-driven operating loss; Hobec recommended continued monitoring of wastewater operations and reserves.
Council accepted the audit (Resolution 2026-46) by unanimous vote and directed staff to post the report and follow procurement and oversight recommendations during the next budget cycle.
Key numbers cited in the presentation: total debt about $3.28 million; general fund cash ~ $3.7 million; general fund decrease $335,000; capital outlays highlighted above; peer-group population average ~5,435 versus Chadron ~5,200.
