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North Mankato council approves 2024 audit; water fund shows $302,000 revenue shortfall
Summary
The council approved the 2024 financial audit, which carried “an unmodified opinion under GAAP.” Auditors and city staff flagged a drop in water revenues of $302,000 and a Water Fund cash balance of $444,149; the Sewer Fund cash balance may cover the Marie Lane Force Main.
The North Mankato City Council voted June 16 to accept the 2024 financial audit, after a presentation by Tom Olinger of ABDO who said the auditors issued “an unmodified opinion under GAAP” and found no instances of noncompliance with Minnesota statute.
Olinger reviewed key fund balances and performance metrics, noting the General Fund balance stood at 58.3% and Special Revenue Fund balances totaled $8,060,453 (cash $4,935,089). He said Capital Projects Fund balances increased by $1,162,019 and the Debt Service Fund holds about $2.6 million in cash and $5.8 million in assets.
Finance Director Ryan told the council the Water Fund cash balance is below target at $444,149 and that “the water revenue was $302,000 less than budgeted,” which the city attributes to lower resident usage and to meters purchased in 2023 that have not yet been sold. Ryan said proceeds from meter sales in 2025 should improve the fund position.
Ryan also reported the Sewer Fund had receipts exceeding expenditures and a cash balance of $2,806,295, which the council discussed as a possible source to pay for the Marie Lane Force Main and potentially avoid bonding for that project. Council members asked about long-term debt levels and financing for a future Public Works building; City Administrator McCann said recent annual bonding has been about $3–4 million with annual debt service of $2–3 million and suggested the Public Works bond could be stretched to as long as 50 years to lower yearly debt service.
The council approved the audit by voice vote (ayes: Oachs, Peterson, Whitlock, Steiner, Carlson). The city will monitor Water Fund cash as meter sales are completed and before making final decisions about bonding for capital projects.
