“A look at your cash on hand shows you are very stable,” said Koop, adding that consistent fund balance in the $2-2.5 million range over the past several years indicates the city is responsible and is prepared to cover its expenses.
When it comes to its finances, the City of Redwood Falls is in a very good place. That information was revealed this past Tuesday night during the regular city council meeting when Thomas Koop of CliftonLarsonAllen, LLP presented the audit of the 2013 books. In what he called a clean opinion, Koop outlined the city’s financial statements and said the city looks to be very stable. Koop said one of the key points in determining the stability if a unit of government like the city is its fund balance. “A look at your cash on hand shows you are very stable,” said Koop, adding that consistent fund balance in the $2-2.5 million range over the past several years indicates the city is responsible and is prepared to cover its expenses. The rule of thumb, said Koop is to have about a half year’s worth of funds on hand. “After Dec. 31 the city does not see tax revenue until July 1,” he said, adding it is good practice to have funds on hand until the money is in the bank.
According to the audit, the 2013 fiscal year ended with an unassigned fund balance of $2,557,021, which reflected 48 percent of the total general fund expenditures. The audit also showed: • The city’s net position in 2013 increased by $197,934, – a .03 percent increase over 2012. • The assets of the city exceeded liabilities by $78,839,365. • Government activities revenues for 3013, included 38.69 percent from local taxes and 28.84 percent from charges for services • Government activities expenditures included 21.53 percent on public safety and 16.59 percent for highways and streets. However, the biggest expense was for culture and recreation. That, said Koop, is unique to Redwood Falls. That line item includes amenities, such as the municipal pool and the community center. According to Koop, the state average for expenditures includes 25 percent for public safety, 8.6 percent for streets and highways and 8.8 percent of culture and recreation. John Buckley, council member, said the state average, which includes all cities with a population of more than 2,500 would include the largest metro areas of the state. He added it would be interesting to see how Redwood Falls compares with other cities its size. Koop complimented city staff for its work in putting together audit information, and he said it is good to see cities like Redwood Falls that have staff who have a very good handle on finances.