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Auditors report 2023 SEFA restatement; Ennis airport fund posted operating losses in 2023–24
Summary
The city’s single-audit presentation reported a restatement to the 2023 schedule of federal awards after provider-relief funds were reclassified (from about $70,000 to roughly $2.1 million); auditors also showed the municipal airport ran operating losses in both FY2023 and FY2024 and recommended staff review revenue options and controls.
City auditors told the Ennis City Commission that a 2023 single-audit schedule of federal awards (SEFA) had been restated after provider-relief fund activity was reclassified, and that the airport enterprise fund has run operating losses in the last two fiscal years.
Rachel Ormsby, the city’s audit partner from Fortis Mazars Group, said the original SEFA reported roughly $70,000 for a program but that additional testing showed that figure should have been about $2.1 million. Ormsby and a manager on the audit team described the issue as a reporting and SEFA-preparation problem related to changing federal guidance during the pandemic, not an improper use of funds. “It was kind of an isolated incident,” the audit team said, and they reported no compliance findings for FY2024 after the restatement and correction.
Ormsby also walked commissioners through an airport fund review that showed operating losses for the airport in both FY2023 and FY2024. The auditors reported negative operating cash at 9/30/2023, a working-capital loan due to the general fund and an unfavorable operating position driven by revenue shortfalls and timing differences between bulk fuel purchases and fuel sales. A manager on the audit team recommended the city consider revenue-side options and tighter oversight of fuel-markup policy, and staff noted the city currently contracts with a fixed-base operator and lacks a dedicated airport manager.
During discussion commissioners asked how fuel inventory and accounting practices might create apparent timing mismatches between expenditures and fuel sales. Staff and auditors explained that inventory accounting and fiscal-year timing can produce a gap if purchases precede sales or if markup practices do not track neighborhood market prices. Staff said a dedicated airport manager position is proposed in the budget and may be included in staff’s upcoming work on the fee schedule; staff will bring fee amendments and additional airport recommendations back to the commission for consideration.
Next steps: auditors will refile the corrected 2023 SEFA with the federal audit clearinghouse within the 30-day period they cited; staff said they will work on corrective controls and report back on airport fund options, including a proposed airport manager position in the FY2026 budget.
