Audit: Strasburg in good financial shape

STRASBURG — Despite major capital projects, the town of Strasburg finished fiscal year 2014 with an extra $879,783 in its coffers, according to the latest audit report released by Robinson, Farmer, Cox Associates.

As previously reported in the Northern Virginia Daily, the Strasburg Town Council conducted its first review in a public forum at its work session Monday night.

Dottie Mullins, the town’s finance director, said she was very satisfied with the town’s fiscal standing.

“We didn’t have to dip into our reserves and were able to add to it,” Mullins said. “Considering we just did our water plant and we have the public works building under construction, I think we did pretty good.”

The audit found the town’s general government fund began the year with a total “fund balance,” which is the town’s savings carried from year to year, of $1.41 million and ended the year with $2.29 million, a 62 percent increase.

During the 2014 fiscal year, the town collected $5.27 million in revenue, $1.53 million of which came from property taxes, $1.66 million from other taxes — such as meals and cigarette taxes — and $1.01 million from the federal government.

The town spent $5.21 million — $1.79 million for the police and fire departments, $1.04 million for public works and $1.28 million toward capital projects.

When comparing revenue to expenditures, the town saved $61,203 during fiscal year 2014. The town also financed the year through bonds and capital leases, amounting to $818,580. By adding the amount saved to the bonds and capital leases, the town was able to add $879,783 to its coffers.

Once the revenue, fund balance and other financing sources are added, the town had $7.5 million in resources for 2014.

The town’s “business-type activities,” which are its sewer, water and trash funds, amounted to $3.93 million in expenses and $5.35 million in revenue from service fees.

The town’s water fund spent $1.93 million and charged $2.49 million, resulting in a $565,5521 profit for the town. The water fund saw $1.69 million in expenditures and $2.56 million in service charges, resulting in an $870,144 profit for the town. The trash fund saw a loss, taking in $292,585 in fees but spending $314,263 during 2014.

The water and sewer funds also received capital grants and contributions, adding up to $1.22 million.

Mullins said the extra money in the sewer and water funds will be used for debt payment on capital projects.

“We have some money in a reserve fund for the water and sewer because we have a loan for the sewer plant, but it will be used to pay that loan in the future so the present rates will not go up,” Mullins said.

Mullins added, “What council did was raise the rates gradually and put the money in a reserve. Once our payment kicks in in another year, I’ll be pulling money out of that reserve to offset the costs.”

In Strasburg, the policy for the general government fund is to maintain a fund balance at about 30 percent of the town’s expenditures. In 2014, the town’s general fund balance to expenditures ratio amounted to around 29 percent.

The ratio is a little high compared to other localities and reflective of the council’s fiscal conservativism and the current economic climate, Mullins said.

“Our council is very conservative and very careful on how they spend money,” Mullins said. “We have an accounting consultant and when I talked to her, she said before the recession a lot of towns and counties were at 10 percent, but after it hit, a lot of localities had to dip into their reserves, so they upped to 25 percent.”

Mullins added, “The consultant said 30 percent is very healthy. Like I said, our council is very conservative and they’ve debated this at several meetings, asking if it’s too much or not enough.”

At the town council work session, Mayor Tim Taylor thanked the finance department for its work with the audit.

“Dottie and the staff, excellent job, you did a heck of a job for us and we at the council appreciate [it],” Taylor said. “It’s good to see we’re in such good shape and I want to thank all the staff and taxpayers as well.”

Contact staff writer Henry Culvyhouse at 540-465-5137 ext. 184, or hculvyhouse@nvdaily.com