Town’s 2017 Audit Shows $380,296 Surplus

by | Apr 17, 2018

The town had a $1.1 million surplus but the schools had a $728,808 deficit.

By Elizabeth F. McNamara

Nine months after the end of fiscal year 2017, the town’s audit shows an overall $380,292 surplus and an unrestricted fund balance of $6.4 million.

The audit was posted to the state Auditor General’s website last week (find it here). It has not yet been posted to the town website and was not available in the town finance department Tuesday.

The audit was due to the state by Jan. 1 – six months after the end of the town’s fiscal year.

Town officials received two extensions through March 31. According to state Auditor General Dennis Hoyle, the state got the audit on April 9.

The Town did not officially seek an extension beyond March 31,” Hoyle said via email. “As a matter of course, if we are in communication with a municipality and they need a few more days to complete beyond the approved extension date we allow that.”

In March, Town Manager Gayle Corrigan issued a letter to residents to explain why she had asked for the extensions, citing among other things an adverse legal ruling on the impact fees collected by the Fire District. According to the audit, the town will use $1.7 million from the fund balance to cover the impact fee settlement (page 16). 

In the town’s Management Discussion and Analysis letter (page 7, signed by Finance Director Linda Dykeman), it is noted that the town’s liabilities exceed its assets by $26.9 million.

According to Auditor General Hoyle, “It is not uncommon for governments, on their government-wide (full accrual) financial statements to have negative net position due to the recognition of pension and OPEB liabilities.”

Hoyle noted that East Greenwich opted to implement the new OPEB standard (GASB 75) standards in 2017, a year before it was required.  

“It appears most of the negative net position at June 30, 2017, resulted from the recognition of the OPEB liability,” he said, referring to audit note 23 (page 74) for details.

Other information from the audit:

The town administration was over budget by $464,913, largely due to legal claims and employee contract payout. Fire Department was over budget by a total of $143,739 – the overtime overage of $225,526 was offset by not filing the fire clerk’s position and lower salary and holiday pay.

In addition, the town’s tax rate for 2018 (the current fiscal year) is $23.66 per thousand, with 39 percent allocated for general government and 61 percent allocated for education. For fiscal year 2017, the town’s tax rate was $24.09 per thousand, with 45 percent allocated for general government and 55 percent allocated for education (page 13).



 

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