By Abbie Newton
Mason Times staff writer
Mason received a positive financial statement for the 2013 fiscal year after adding almost $2.5 million to its fund balance, the city’s auditor reported at the City Council meeting on Oct. 21.
William Tucker IV of Abraham and Gaffney audited the city and said Mason is doing fiscally well compared to many other communities in Michigan.
“In our opinion, the financial statements present fairly in all material respects,” Tucker said. “That is a clean opinion and it is the best you can receive.”
A clean opinion states that there are no issues with the financial statements, Tucker said. He also said Mason added $2,467,200 to its unassigned fund balance.
“Unassigned fund balances can be used for expenditures in future years,” Tucker said. “If the city revenues do not come in as strong in future years, they can use some of the fund balance to continue operations within the city.”
Mason Finance Director Eric Smith said he was pleased with the balance. He said about 60 percent of the balance came from property tax and the other 40 percent came from revenue sharing from the state.
“It is a high fund balance, which means we will be able to meet our needs and move forward,” Smith said.
Tucker said he recommends that cities have fiscal reserves totaling about 20 percent of annual expenditures. Mason’s reserves represent 58.1 percent of expenditures.
“A lot of communities are spending more than they are bringing in, so it is unique to Mason to bring in a fund balance,” Tucker said.
Mayor Pro Tem Robin Naeyaer said she was excited about the high budget reserves.
“When you are hearing of other small municipalities on the brink of bankruptcy, having a 58 percent reserve is absolutely unheard of. Our residents should be thrilled with that, knowing we have a rainy day fund if something should happen.” –Mayor Pro Tem Robin Naeyaer
Naeyaer said she was proud of the City Council and the finance director for providing the city with financial security.
“Our job as a council is to provide public safety and services for the city,” Naeyaer said. “We can continue to provide public safety, our police force, our fire department, fresh water and other things.”
Tucker said the city added another $843,033 to its general fund because the city had lighter expenditures than expected. Smith said the city is required by the state to allocate money toward a 5-year street program that develops and enhances streets and infrastructure.
Smith said the timing of the street program allowed Mason to have lighter expenditures during this fiscal year, resulting in the surplus. However, expenditures are expected to be heavier during the next fiscal year.
Smith said he was satisfied with the surplus and hopes the economic growth continues. In addition, he said he would like to see Mason’s tax base expand.
“We would like to see more businesses locate here,” Smith said. “We would like to see diversified, industrial, commercial and residential growth.”