City auditors give Galesburg a clean 2025 audit; water fund buoyed by one-time settlement

Baker Tilly presented the City of Galesburg’s annual comprehensive financial report for the year ended Dec. 31, 2025, and told the council it issued an unmodified opinion — the highest level of assurance an auditor can provide.

"We issue what's called an unmodified opinion, which is the highest level of assurance that we can provide," said Mike Blott, the engagement principal from Baker Tilly. He told the council that the opinion indicates the city's financial statements can be relied on by citizens, bondholders and municipal officials.

Auditors said governmental funds experienced a small spend-down where expenditures exceeded revenues, while the water enterprise fund posted a substantial surplus of about $5.2 million, roughly half of which resulted from a one-time legal settlement. Pension and OPEB plans also recorded strong investment performance, with returns of about 17% in 2025.

Blott also reviewed required supplemental reports: TIF compliance reports, a single-audit of federal awards that included a review of the CDBG sewer replacement program, and an IDOT agreed-upon-procedures report tied to state fiscal-year reporting. He said staff and the city’s processes produced no findings across those reviews.

The auditor closed by noting the reports were issued on June 26 and encouraged council and staff to read the transmittal letter and management’s discussion and analysis for the highlights and context of the financial statements. The council raised questions about overall surplus calculations; Blott said that when pension trust increases are included the city shows an overall surplus but that pension assets are restricted and not available for general operations.

The council accepted the audit in both its city-council and town-board capacities later in the meeting.