2017-06-15 / Front Page

Auditor sheds light on budget matters

810-452-2645 • tterry@mihomepaper.com

BURTON — An auditor shed light on budget matters which council members and others had questions about at a recent budget meeting. Pam Hill was at the meeting to do so, representing the city auditing firm, Plante Moran.

Mayor Paula Zelenko said she felt what Hill said confirmed her stand on an issue she and the council have been debating.

“I still believe, even if I vetoed and they override the veto, they don’t have the ability to remove money in the current budget,” Zelenko said.

Zelenko said she needs to run the city.

“You can’t plan day to day activities if they have the right to pull money they’ve already approved,” she said.

The city charter says in 7.6 (c): If it shall appear that the revenues are less than anticipated, the Council may, by resolution, reduce appropriations, except amounts required for debt and interest charges, to such a degree as may be necessary to keep expenditures within the revenues.

Councilman Vaughn Smith said he looked at an estimate.

“Our personal property taxes were down $119,000 from what we anticipated,” he said to Hill at the meeting. “So, the council said we can’t afford to do a seawall and maybe a parking lot we had wanted to do. So, we voted to remove that from the current budget-not the proposed budget, but the current budget.”

Hill said a lot of people think a balanced budget means revenues equal expenditures, but that’s not technically the case.

“You have to take a look at your revenues and expenses, but also your fund balance,” she said. “I’m not saying you always want to be dipping into your fund balance. But, if you have enough fund balance to cover something, you’re technically not in a deficit budget if you use fund balance to fund some type of project.”

Hill gave an example of having big roof repair that needed to be done right away.

“If you don’t have the money, but you have it in fund balance, you are allowed to make an amendment to have an expenditure for that item even though you’re projecting that your revenues can’t cover it,” she said.

Hill said this is so under the authority of The Budget Act, which is a law at the state level.

Zelenko said if the city were in a deficit budget it would be acceptable for council to move money that had already been appropriated.

However, she confirmed she will receive at least $149,000 for delinquent property taxes from the county June 19, and that the taxes will not be down $119,000.

Hill said she has not seen the proposed 2018 budget, but she is assuming the city is not budgeting into a deficit.

Zelenko said the city has the fund balance to cover all expenditures.

“We are not in a deficit budget,” Zelenko said. “We don’t expect to be.”

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