Audit says Oneida County running in strong position

September 24, 2017

Richard Moore

The Lakeland Times

Oneida County auditors have once again wrapped up their annual tasks, and once again they report the county to be in strong financial position as a new budget year approaches.

David Maccoux of Schenck, the county's CPA firm, told the Oneida County Board of Supervisors the audit went very well and that Oneida County posted a very consistent year. The county's general, or operating, fund totaled $18.1 million compared to about $18 million the year before, Maccoux said.

"Your unassigned fund balance did go up and that was because some of your prepaid expenses went down, which is a non-spendable, but overall it was a very strong budget year, and you are carrying funds in subsequent year expenditures forward to future years," he said.

In short, Maccoux said, the county is flush.

"When we look at the government funds, we focus on fund balance, which is a sense of liquidity," he said. "And, as I indicated, the county's general fund is in excellent financial position as you enter your budget year."

However, Maccoux said, as the county winds through the budget process, difficulties may arise that make it harder to adopt a budget.

"I've already been asked, 'why is it difficult if we have a strong fund balance?'" he said. "It's because revenues coming in don't often equal expenses going out. So the county, like every other government, has some hard choices to make. But from an overall financial position, most governments, like Oneida County, are very strong."

In proprietary funds, Maccoux said, there was a subtle change.

"When we shift to highways and solid waste, we more or less start looking at your operating activities," he said. "The highway department did have a slight operating income of about $35,000. The highway department also has a special revenue fund that pays for the county's maintenance of the highway system and that fund decreased about $80,000 but has about $1.9 million for future road projects. So overall the highway department is in very good shape."

But there was a red flag or two in the solid waste operations, Maccoux implied.

"As for solid waste, one of the expenses in this area is depreciation, which is non-cash but you can see, over time, the last couple of years, you have generated operating losses and, as we discussed at (the) administration (committee), the solid waste committee and the department is really monitoring that going forward and we just recommend that you continue to monitor that going forward and make sure your cash position continues to be strong."

The meaning of things

County board chairman Dave Hintz wanted Maccoux to describe the county's financial condition in one word, which he did: "Strong."

That wasn't the word Hintz was looking for, and it wasn't the word Maccoux apparently used at an earlier administration committee meeting, so Hintz prompted him by reminding him that the word previously used was 'excellent.'

"Excellent, consistent - both mean a very strong position," Maccoux said.

And how does Oneida County compare with other counties? Supervisor Carol Pederson wanted to know.

Very well, Maccoux replied, saying Schenck performed audits for 30 counties in the state.

"From a financial perspective , as I indicated, many counties are very strong," he said. "My larger counties will have a smaller fund balance in proportion to their activities, but that's just because of the size of the entity, and they may have budgets over $100 million. So, based on size, your fund balance is often a different percentage. Looking at the fund balance as a portion of your operating budget, you are very strong, and it gives you an opportunity for any type of contingencies, or any one-time projects that come up allows you to use some of that."

But using the balance for one-time projects presents its own challenges, Maccoux said.

"The challenge with using it for budget purposes, those create unfunded future obligations," he said. "You are in a position like many governments that are in strong or excellent financial position. I would say from a size entity, you are very comparable if not on the higher end of the strength of your position."

Maccoux said the county's total assets are about $119 million, which includes infrastructure such as roads and bridges, equipment and buildings. He said those assets were key to providing services to citizens, and they had grown over the past year.

"From our perspective, the audit went very well," he concluded. "We do work with the finance area but our team spends time in every department so when we reflect on how the audit went, it's really through the efforts of everyone here in the county. The audit process itself does entail a lot of work and from our perspective everyone was very cooperative in the completion of the audit."

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