ATASCADERO — Few words inspire more terror between January and April than the casual utterance of “audit.”
If one is personally dealing with the Internal Revenue Service or scrambling for an accountant however they’ll probably hope to hear something akin to the news the City of Atascadero officially received at their Jan. 23 regular City Council meeting from the audit firm of Moss, Levy, and Hartzheim.
The firm’s representatives reported that they’d performed a full audit of the City’s financial statements and found that the municipality had presented fairly and accurately their financial position, “and further, that the reporting was in conformity with generally accepted accounting principles.”
That doesn’t mean they looked at every single piece of paper or digital file where the City handled funds, but a selective review of Transit and Fire Department funds found no errors. Their report concluded on Jan. 7 with a review of the City’s financials dated to June 30, 2018.
The staff report delivered by Administrative Services Director Jeri Rangel noted expenditures have been up slightly and the City’s financial strategic plan, also discussed in a separate agenda item, calls for them to keep drawing on approximately $12 million set aside through 2022-23 as they pursue more revenue.
“The idea,” she said, “is to keep the reserves stable through [positive] economic times and draw on it as needed through lean times.”
She showed Council a graph with the fluctuating periods of revenue growth and increased costs over time.
The best encapsulation in the report addressed the General Fund, aside from revenue broken down separately from a special sales tax ballot measure, “revenues were just under $21.8 million for the fiscal year. General Fund expenditures were about $20.9 million during the year. The net change in fund balance for the General Fund was an increase of about $867,000. The June 2017 Seven-Year Projection estimated a net loss of $367,600. This is a positive difference between actual and projections of about $1,234,700.”
Trends in cash flow addressed in Council questions were that the City primarily gains income from property and sales tax, and spends a disproportionate amount on roads compared to neighboring municipalities.
The City also gains a majority of its sales tax revenue from fuel taxes.
Some of the graphs on sales tax per capita gave visual representation to, “why we have trouble ‘keeping up with the Jones,’” Rangel said, allowing that, “it makes things difficult when neighbors have more money to spend for the same services, and, this shows the difference.”
That was a sentiment echoed by the sole member of the public who came to speak on the matter, Don Giessinger, of the City’s Citizens Sales Tax Oversight Committee, who reflected on what he said was a doubling or quadrupling of the revenue disparity between Paso Robles and Atascadero in per capita sales tax of the four decades he’d been in local retail. The cities had started with roughly equal population but at this point, he said, “for every $1,000 we see coming in they get $4,000.”
There was some good news, however, as Rangel reported that income from Transient Occupancy Taxes, the fees paid to the City by overnight guests in hotels inside municipal boundaries, were up. Two more hotels are slated to open in 2019 as well she added.
Mayor Heather Moreno noted in moving to accept the reports that if one’s eyes glaze over in the details of an audit document, the policy papers available on the City’ website are more interesting.
She also invited members of the public to come to two days of strategic planning with the Council on Friday evening and Saturday morning.