Auditor gives Old Orchard Beach an unmodified opinion and flags rising general assistance costs

Ron Smith, principal at RHR Smith & Company, presented the town's June 30, 2025 financial and federal compliance audits and said the firm issued an unmodified — the highest — opinion on the town's financial statements.

"You received our highest opinion and unmodified opinion," Smith told the council, adding that the firm also completed a federal compliance audit tied to the town's wastewater infrastructure work. He noted the town is using a state revolving loan fund for the wastewater project and described the overall undertaking as a multiyear, multidepartment effort.

Smith singled out the town's general assistance (GA) program as the largest concern in the audit commentary. He summarized the GA finances presented in the audit: the town recorded approximately $1.2 million in GA-related expenses and received roughly $900,000 in state reimbursement during the reporting period, leaving an unreimbursed town commitment Smith described as on the order of several hundred thousand dollars as of June 30, 2025. Smith said the GA trend is the single biggest expenditure item the auditors observed.

Smith also reviewed fund-balance trends and liquidity measures, saying the town had the equivalent of roughly four and a half months of operating budget on hand — a level the auditors view as prudent given Old Orchard Beach's seasonal and infrastructure cashflow profile. He told the council the audits were submitted on time and that the department transitions in finance were handled without material deficiency findings.

Why it matters: The audit's unmodified opinion confirms the town's fiscal statements are materially correct for FY25, but the growth and timing of GA reimbursements and the long-running wastewater infrastructure program will be ongoing budget drivers as the council reviews the FY27 budget.

Ron Smith said he is available to answer follow-up questions as council and staff work through budget workshops.