Greenville received the best audit opinion that can be issued, the city’s finance director said, even though it had to be amended because of how state money for street maintenance was entered.
Finance Director Byron Hayes and a representative of the auditing firm Cherry-Bekaert presented an overview of the city’s fiscal year 2020-21 audit at the end of Monday’s five-hour City Council meeting.
Cherry-Bekaert issued an unmodified opinion, the best audit opinion that can be issued for the audit of the city’s fiscal year ending June 30, 2021, Hayes said. It’s the second year an audit had to be completed during COVID, he said.
More staff was included in the statement process to improve continuity in case staffing changes occur. Greenville also added cloud data storage to provide redundancy of city records.
Hayes said the outside auditor made one finding about an accrual entry of Powell Bill money, which is funding from the state that pays for street resurfacing and other maintenance.
Hayes said an entry that was recorded in the current fiscal year should have been entered and recorded in the previous year. The error was corrected and staff implemented a corrective action plan where financial services will increase oversight of department invoices greater than $10,000. Financial services approval will be required within the city’s finance software.
The city will also be required to send a letter to the state’s Local Government Commission, a division of the state treasurer’s office, addressing what the commission calls a financial performance indicators of concern, said April Adams with Cherry Bekaert. It’s the first year the commission has required local governments to send letters, Hayes said.
The issues Greenville must address involve submitting its audit after Dec. 1 and the commission’s concern that the city’s available fund balance is less than 25 percent of its budget.
“I am not as worried about (the fund balance) because you have an extra $ 4.5 million in your capital reserve and if you would include that in your general fund (balance) you would hit the 25 percent,” Adams said.
She doesn’t think the city needs to make changes, but it needs to respond to the commission’s concerns within the next 60 days.
The state requires local governments to keep an amount equal to 8 percent of its general fund in a fund balance, which is a type of savings account. Most local governments, including Greenville, have fund balances larger than 8 percent.
Hayes said Greenville had a 25 percent fund balance but several years ago transferred some of the money to a capital reserve fund in preparation for street improvement projects.
Hayes said the Local Government Commission will get a copy of the City Council’s policy on fund balance, which states the city will keep a minimum fund balance of 14 percent with a goal of keeping it at 16 percent to 18 percent.
Hayes said the commission has 21 performance indicators and the fund balance is the only one that was questioned.
As for the actual 2020-21 general fund overview, the city’s revenues were $909,645 greater than expenses. City revenues were $89 million as of June 30 and expenses were $88.1 million, Hayes said.
Seventy-two percent of the revenues came from property and sales tax, he said. While some revenue sources were negatively affected by COVID-19, the city’s sales tax increased by 18 percent.
The bulk of the budget, 45 percent, was spent on public safety, Hayes said, followed by “other expenses” at nearly 19.4 percent, other departments by 16.6 percent, public works and engineering nearly 11.5 percent and recreation and parks 7.4 percent.
About $1.3 million of public safety salaries were funded through coronavirus relief funds, so that money was accounted for in a different line item.
COVID didn’t impact the city’s fund balance as projected because of the relief dollars spent on public safety salaries.
Other business
Monday’s council meeting was dominated by a nearly three-hour public hearing on a text amendment that will permit two types of data processing facilities to operate in the city and unincorporated areas under the city’s planning and zoning rules.
However, there were a number of other public hearings and three items on the agenda that the council unanimously approved:
- Resolutions closing portions of Truman Street and Line Avenue.
- Annexing 29 acres located at the end of Cobblestone Drive.
- Annexing nearly 1.6 acres on the northwestern corner of the intersection of West Arlington Boulevard and Dickinson Avenue.
- Annexing 1.3 acres near the southeastern corner of the intersection of Davenport Farm Road and Frog Level Road.
- Annexing Springshire Retirements property containing 17.296 acres located north of the intersection of N.C. 43 North and Rock Springs Road.
- Rezoning 23.5 acres located along the western right-of-way of Allen Road and adjacent to the Pitt County Landfill from residential-agricultural heavy commercial for 3.8 acres and unoffensive industry for nearly 20 acres.
- Rezoning nearly 66.9 acres located along the western right-of-way of Allen Road and adjacent to the Pitt County Landfill from residential-agricultural) to heavy commercial for 6.7 acres and unoffensive industry for 60.2 acres.
- Amending the future land use and character map for 50 acres located along the northern right-of-way of Frog Level Road and adjacent to Teakwood Green Subdivision from commercial and potential conservation/open space to residential, low-medium density.
- Amending the city code to include miscellaneous changes to the zoning ordinance.
- Authorizing the appropriation and expenditure of funds for a job creation grant and entering into an economic development agreement with Patheon Manufacturing Services.
- Approving a lease agreement to lease the Lucille W. Gorham Intergenerational Center Chapel, located at 1124 W. Fifth St., to American Legion Post 160.
- Updating the city’s agreement with and granting easements to the North Carolina Department of Transportation for the Dickinson Avenue modernization project.
