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Erie County audit: clean opinion, minor restatements, general fund stronger than budgeted
Summary
An external auditor reported an unmodified (clean) 2025 opinion for Erie County, noted several restatements that did not affect the general fund, and said the county ended the year with stronger unrestricted reserves and manageable debt service.
Natalie Caponi, the presenting auditor, told the Erie County Finance Committee the county’s 2025 financial statements received an unmodified opinion — the highest level of assurance auditors issue. She said the audit used risk‑based sampling and that the firm identified some corrected misstatements affecting prior‑period, nonroutine accounts but not the county’s general fund.
“The most sensitive estimates are pension and OPEB liabilities,” Caponi said, and she pointed stakeholders to related disclosures in the notes to the financial statements. Caponi said restatements touched custodial and capital asset accounts and adjustments within the Pleasant Ridge Manor entity but did not change the general fund totals.
On the general fund’s performance, Caponi reported total revenues of $121,950,000 and expenditures of about $90,900,000 before transfers. After transfers out of $31,350,000, the general fund posted a net change in fund balance of a $299,000 deficit — substantially better than the $4.1 million budgeted deficit for 2025. She said the county’s ending unrestricted general fund balance represents roughly 41% of annual expenditures and transfers, well above the two‑month policy benchmark.
Caponi also reviewed Pleasant Ridge Manor’s results: the long‑term care facility ran an operating gap in 2025, with revenues of $28.9 million and expenses of $34.8 million, increasing the county subsidy to $2.5 million in 2025 versus $1 million in 2024. She said Pleasant Ridge’s unrestricted net position remained in deficit at year‑end.
On debt, Caponi said the county’s outstanding principal fell from about $13.6 million at the start of 2025 to $7.21 million after principal payments, with debt service below 2% of noncapital expenditures — a profile she described as supportive of the county’s strong ratings.
The auditor noted a reporting‑entity change: Erie County Care Management was removed from the county’s reporting entity as of Jan. 1, 2025, following a 2025 ordinance. She also reported the firm is completing a single audit of federal awards and will issue a management letter and governance communication when that work concludes.
Next steps: the committee did not take a formal vote on audit acceptance during the meeting; staff said they would circulate the single‑audit results and management letter when complete.
