City Of South Lyon Earns High Opinion, Positive Audit Report
October 18, 2019
The City of South Lyon has received a positive audit report, earning the cleanest opinion an auditor can give regarding a municipality’s financial recording.
A presentation of the audit conducted by Plante Moran was given at a recent city council meeting. CPA Spencer Tawa said the presentation is the conclusion of a longer process as they began the planning and risk assessments back in the spring, prior to the end of the fiscal year. He notes that the city’s revenue increased by over $470,000 this last year due to an increase in property taxes, which is South Lyon’s largest source of revenue at $4.2 million. The increase was also caused by a hike in taxable values, the city’s millage rate, and permit fees.
Tawa then spoke to the municipality’s general fund, which had $5.7 million in expenditures this last fiscal year. He noted that the city saw in uptick in general fund expenditures, but added that the increase is due to capital improvement purchases like a police vehicle, as well as wages, fringe benefits, and contributions to pension plans. The city did, however, add about $670,000 to its general fund. Tawa says the audit found that the fund balance is sufficient for city operations, and that the municipality has just over $50 million as a total net position.
Tawa also stated that revenue from water and sewer users has exceeded expenditures, but that officials need to understand infrastructure needs. As a result, auditors will be working with city staff to perform a sewer and water rate analysis, which will be coupled with a review of the sewer and water systems and development of the municipality’s Capital Improvement Plan to develop a proper rate structure to ensure a solid plan moving forward for city-wide utility system improvements. Officials are also working on a corrective action plan for finding other post-employment benefits for city employees.
As a result of the audit, Plante Moran had a few suggestions; including limiting wire transfers for best practices and to consider legal options for safer investments that have a higher rate of return. City Manager Paul Zelenak says some of those recommendations were instituted at the beginning of this budget year and others are currently be initiated. The audit is available at city hall and on the City of South Lyon’s website. It will also be made available at the Salem-South Lyon District Library or can be viewed through the link below. (DK)