Town of Orchard Park, New York 2010 Audit Town Board Work Session - PowerPoint PPT Presentation

Town of Orchard Park, New York 2010 Audit Town Board Work Session May 4, 2011 0

Town of Orchard Park Products of Our Audit: – Auditor Communication Letter – Comprehensive Annual Financial Report – Departmental Audit Reports • Receiver of Taxes • Town Clerk • Town Justices – Management Letter 1

Town of Orchard Park Auditor Communications • Our responsibility under GAAS • Significant accounting policies • Management judgments and accounting estimates • Alternative accounting treatments • Disagreements with management • Difficulties encountered in performing the audit • Audit adjustments 2

Town of Orchard Park General Fund - Fund Balance Fund balance consists of three parts: 2010 2009 $ 955,531 Reserved $ 905,155 Designated 2,688,553 2,364,313 Unreserved, undesignated 3,928,222 4,160,988 $ 7,572,306 Total fund balance $ 7,430,456 3

Town of Orchard Park General Fund - Fund Balance Reserves • Reserves of fund balance represent funds that have been legally segregated and can only be used for a specified purpose. • General Fund reserves at 12/31/10 are: Encumbrances $ 7,436 Cemetery 21,822 D.A.R.E. program 20,590 Senior Center 1,272 Tax stabilization 655,900 Prepaid expenditures 248,511 Total reserved fund balance $ 955,531 4

Town of Orchard Park General Fund - Fund Balance Designations • Designations represent management’s intent to use a part of fund balance in some manner. • General Fund designations at 12/31/10 include: Capital improvements $ 750,000 Subsequent year's expenditures 800,000 Insurance deductibles 401,833 Workers' compensation 729,815 Town historian 6,905 Total designated fund balance $ 2,688,553 5

Town of Orchard Park General Fund - Fund Balance Unreserved • Unreserved fund balance represents funds that may be used for valid Town purposes at the Board’s discretion and in accordance with Town Law. • The unreserved, undesignated fund balance at 12/31/10 is $3,928,222, which represents 36.3% of 2011 budgeted appropriations. 6

Town of Orchard Park General Fund - Unreserved, Undesignated Fund Balance $4,500,000 $4,160,988 $4,000,000 $3,708,394 $3,928,222 $3,295,236 $3,500,000 $3,073,643 $3,231,540 $3,000,000 $2,500,000 $2,590,769 $2,701,037 $2,431,819 $2,000,000 $2,143,552 $1,500,000 $1,000,000 $500,000 $0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 7 7

Town of Orchard Park General Fund – Budget History $12,000,000 $10,000,000 $8,000,000 $6,000,000 Appropriations $4,000,000 Estimated Revenues $2,000,000 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 8 8

Town of Orchard Park General Fund – Actual Revenues and Expenditures $12,000,000 $10,000,000 $8,000,000 $6,000,000 Actual Expenditures* $4,000,000 Actual Revenues $2,000,000 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 * All transfers to the Capital Projects Fund were excluded from the total expenditures each year. 9 9

Town of Orchard Park Cost Drivers - Health Insurance (All Funds) $1,800,000 Inverse of national trends $1,600,000 Annual Cost $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 The Town reduced the cost of health insurance from 2006 to 2009. In 2010 the cost increased by 2.9%. 10 10

Town of Orchard Park Cost Drivers - Retirement (All Funds) $1,600,000 $1,500,000 $1,400,000 $1,300,000 $1,200,000 $1,100,000 $1,000,000 $900,000 $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 In the early 2000’s rates were very low. However, market losses and increased retirement costs have caused required contributions to increase significantly for 2010. The rates for 2011 have also increased significantly. 11 11

Town of Orchard Park Source of Funds - General Fund 2010 Revenues 2000 Revenues Charges Interest Interest Non- and fees income income Charges State aid property 4% 6% State aid Non- 2% and fees 14% taxes property 4% 9% 35% taxes 29% Real Other Real Other property revenue property revenue taxes 2% taxes 2% 46% 47% 12 12

Town of Orchard Park General Fund – Revenue Variances 2010 2009 Revenue Budget Actual Actual Real property taxes $ 4,677,242 $ 4,675,890 $ 4,565,531 Sales tax 3,240,000 3,335,415 3,277,059 Parks & recreation fees 280,000 313,451 278,508 Interest earnings 25,000 34,791 106,129 Fines & forfeited bail 320,000 268,819 376,714 Refunds of prior years exp. 10,000 16,489 173,987 Rec. gifts & donations 20,000 60,557 57,521 Mortgage tax 700,000 702,961 762,628 Total actual revenues exceeded final budget by $324,365 during 2010. 13

Town of Orchard Park Historical Perspective – Sales Tax Fund General Highway Part Town Total 2010 $ 3,335,415 $ 110,000 $ 283,709 $ 3,729,124 2009 3,277,059 150,000 252,973 3,680,032 2008 3,383,847 230,000 219,505 3,833,352 2007 3,260,188 260,557 284,347 3,805,092 2006 2,638,187 240,557 283,075 3,161,819 2005 2,909,484 50,000 278,661 3,238,145 2004 2,688,237 - 235,742 2,923,979 2003 2,690,844 - 218,999 2,909,843 2002 2,501,059 - 179,723 2,680,782 2001 2,440,128 - 174,711 2,614,839 2007 included a new supplemental allocation (based on the increase in the sales tax rate which occurred in 2006). 14

Town of Orchard Park Use of Funds - General Fund 2010 Expenditures 2000 Expenditures Employee Employe Transfers benefits e benefits Transfers 18% 15% 28% out Other Culture & Other 1% 1% rec. 1% Culture 12% & rec. General 13% govt. Transport 26% ation General 2% govt. Transport 28% ation Public 1% Public safety safety 33% 33% 0 0

Town of Orchard Park General Fund – Expenditure Variances 2010 2009 Expenditure Budget Actual Actual Salary of tax receiver $ 42,707 $ - $ 26,021 Salary - assistant engineer/inspector 468,195 338,240 389,523 Unallocated insurance 310,000 161,934 196,668 Salaries of police 2,674,324 2,781,662 2,668,427 Recreation equipment 78,000 72,495 - State retirement 419,000 260,071 162,275 Police retirement 551,000 619,086 346,436 Medical insurance 1,202,700 1,116,782 1,047,690 Total actual expenditures were under the final adjusted budget by $521,978 during 2010. 16

Town of Orchard Park Tax Rate Per $1,000 of Assessed Valuation General Fund - 2002 to 2011 $6.00 Rate per $1,000 of Assessed Valuation $5.00 $4.00 $3.00 $2.00 Town Outside Village Residents Village Residents $1.00 $0.00 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Town outside village tax rates have increased from $2.56 to $2.97 in the ten year period from 2002 to 2011. However, village residents experienced an increase from $4.58 to $5.74 over ten years. 17 17

Town of Orchard Park Highway Fund - Unreserved, Undesignated Fund Balance $1,200,000 $986,874 $1,000,000 $903,605 $841,957 $974,467 $786,900 $800,000 $793,543 $711,974 $581,943 $600,000 $495,511 $400,000 $454,840 $200,000 $0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 The unreserved, undesignated fund balance represents approximately 25% of 2011 budgetary appropriations. 18 18

Town of Orchard Park Source of Funds - Highway Fund Charges Other and revenue Sales taxes fees 1% Interest 4% 2% income 0% State aid 3% Real property taxes 90% The Highway Fund is primarily supported by real property taxes. An allocation of sales tax, interest income, state aid and charges for services to Erie County make up the balance of revenues. 19 19

Town of Orchard Park Use of Funds - Highway Fund Employee Benefits Debt Sevice Transfer to 19% 10% General Capital Government 0% 1% Transportation 70% 20 20

Town of Orchard Park Tax Rate Per $1,000 of Assessed Valuation - Highway Fund - 2002 to 2011 $3.00 Rate per $1,000 of Assessed Valuation $2.00 Outside Village Residents Village Residents $1.00 $0.00 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Highway tax rates increased in each of the past 8 years (3.3% in 2011) after having remained virtually unchanged over the prior ten year period. 21 21

Town of Orchard Park Special District Funds - Unreserved, Undesignated Fund Balance $3,000,000 $2,500,000 $2,000,000 $1,500,000 Sewer Water $1,000,000 Refuse and Garbage Lighting $500,000 $0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 22 22

Town of Orchard Park Use of Funds - Special Districts Water Districts 27% Lighting District Sewer Districts 8% 20% Refuse and Garbage 45% 23 23

Town of Orchard Park Total Sewer District Tax Levy - All Districts Combined $900,000 $800,000 Total Levy -All Sewer Districts 718,801 660,354 699,757 $700,000 638,389 750,188 604,438 656,913 648,745 $600,000 639,144 616,967 $500,000 $400,000 $300,000 Total Tax Levy $200,000 $100,000 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Over the past 10 years, the assessable tax bases have generally increased causing the actual tax rates to generally be lower. Tax rates vary by individual district and changes in rates are determined on a district by district basis. 24 24