KEMPNER — City Council members reviewed the 2011-2012 fiscal year audit and earmarked excess general fund balances for possible wastewater infrastructure.
“The purpose of the audit report is to get another — outside — look,” said Preston Singleton, of Singleton, Clark and Company, the city’s auditor. “In our opinion, the financial statements are presented fairly. The numbers appear accurately. In our opinion, the city does have good financial controls.”
Singleton said at the end of the fiscal year, the city had about $366,000 in its fund balance, which was an increase of about $14,000 from the previous year.
“The city brought in more money than it spent,” Singleton said explaining the increase.
When compared to the city’s monthly operating cost, the fund balance could provide for about 24 months of operations.
Because of the large excess, the council earmarked about $252,000 for possible future wastewater infrastructure improvements since properties in the city only use septic tanks.
“Basically we have a bunch of money out there,” Mayor Gene Isenhour said to the council. “I think one day we are going to need a wastewater system, and that is going to take bunches of money.”
It could be years before such a system is needed or until Kempner can afford such an operation, Isenhour said. The city also may have to tap into another public entity’s system.
Earmarking the money shows residents the city is thinking of its future and not wasting their tax dollars, Councilman Robert McKinnon said.
Since the money is only allocated, it could be used for other infrastructure improvements such as construction of waterlines, road construction and more if needed.
In other actions, the council officially accepted a settlement offer for a lawsuit between the muncipality and Gene Doss Construction Inc., United Fire and Indemnity Company, and United Fire and Casualty Company.
Doss Construction was the city’s general contractor for city hall. The facility had several problems after its construction, which the contractor refused to cover under its warranty.
The settlement was for about $15,000 and will be spent on repairs to the building, which was constructed in 2011.