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Oxford staff report accounting-system errors, reserve requirement and possible water-rate increase
Summary
A Small City Resource Institute representative told council the new financial system is producing incorrect numbers; he advised transfers from capital funds, suggested considering a water-rate increase, and warned of a new law requiring a three-month operating reserve next year. Clerk Taylor will seek updated bank-rate information.
Clint, a representative of the Small City Resource Institute, told the Oxford City Council at its June 9 meeting that the city's new financial system is returning incorrect numbers and staff are working to resolve the discrepancies. He advised the city could move street-project expenses into a capital fund and perform an internal transfer to restore operating balances rather than immediately amending the budget.
Clint also recommended the council consider a water-rate increase and warned of an upcoming statutory requirement that will require the city's general fund to maintain a three-month operating balance next year. He said city-held certificates of deposit currently show relatively low yields and suggested staff consider cash-management or high-yield accounts for liquidity given potential near-term project needs. Clerk Taylor Tvedte said she will contact the bank and report back to council with current rates and options, including inquiries to Hills Bank.
Councilmembers discussed the recommendations and agreed they could use transfers to cover immediate shortfalls while staff examine rate and reserve options. The report was presented as the treasurer's item; council gave staff direction to follow up with banks and include any recommended water-rate options in a future agenda.
