LISBON – The state Comptrollers office found the town to be unnecessarily reserving money in its fund balance in an audit published last week.
According to the report, the town Council did not adopt a policy or develop procedures to govern the level of fund balance maintained. Additionally, the [Council] has not developed accurate budget estimates or a formal, comprehensive multi-year financial and capital plan to adequately address the Towns long term operational and capital needs . The general fund has retained excessive amounts of unexpended surplus fund balance.
For example, the report continued, in the 2010 budget, actual revenues were $98,661 or 19 percent more than the budgeted estimates while actual expenditures were $101,087, or 14 percent less than the amount budgeted.
Lisbon has maintained unexpended surplus funds in excess of $600,000 between 2008 and 2011, including just over $1,000,000 in 2009 and 2010.
Town Council member Alan D. Dailey said the report is the opinion of the Comptrollers office and the town has not been found in violation of any laws.
As far as Im concerned, as much as any government entity can keep in fund balance is a good idea, Mr. Dailey said.
Mr. Dailey said the Council maintains a large fund balance to act as a safety net in difficult financial times. He pointed to the towns ability to keep taxes the same or lower them over the past three years.
In the 2013 budget the town lowered the tax rate from $5.37 per $1,000 in 2012 to $5.35 per $1,000.
I dont see how Lisbon tax payers can complain because weve either kept taxes the same or reduced them, Mr. Dailey said.
But the Council has taken steps to address the concerns of the Comptrollers office.
The Council hired a budget analyst to assist them with preparing budgets and planning for using and/or reserving unexpended surplus funds, the report said adding that long term planning and a more organize distribution of fund balance monies is necessary.
Town Supervisor James A. Armstrong said in a statement, The Town of Lisbon has used the fund balance as an unofficial reserve account to address one time purchases and unexpected expenses to prevent spikes in the tax rate for its citizens.
It is the goal of the Town Board to work on a long term financial and capital plan in 2013 to help with the appropriate use and monitoring of the reserve accounts, Mr. Armstrong said.
Mr. Armstrong added that the town has begun to reserve fund balance money in specific accounts as opposed to keeping it all in one pool. Were putting some aside for capital projects.
In the 2013 budget, for example, the town set aside an account set to accrue $200,000 in three years to be applied towards a new snow plow. A written corrective action plan is due within 90 days. The Comptrollers office recommended the plan be made public in the Town Clerks office.