Audit Shows St. Clair Shores Had a Surplus in the 2012 Budget
Auditors for Plante & Moran stated the city finished the 2011-2012 fiscal year with a nearly $2 million budget surplus and received the best opinion possible from their auditors.
St. Clair Shores ended the 2012 fiscal year with a $2 million surplus according to an audit presented to City Council Monday by Plante & Moran.
The $2 million surplus will be placed in the so-called "rainy day fund," which now stands at $14 million. Had the city done nothing over the past year, the initial estimates the city would have needed to withdraw $2.5 million from the "rainy day fund" to balance the budget.
"The department heads work daily to make sure that we are within our budget," said Mayor Kip Walby. "They deserve the credit and will hopefully continue on."
The city received an "unqualified" opinion from Plante & Moran, which is the best opinion a city could receive from their auditors.
Council and administration was also recognized for their efforts to reduce costs through not filling vacancies, leveraging technology and looking for efficiencies while still maintaining services.
"To respond the way you have is extremely impressive," said David Herrington, partner with Plante & Moran.
Harrington added that city's financial position is in a unique position in the county.
"(St. Clair Shores is) in the minority for a community south of Hall Road," Harrington added.
While the city had a surplus this year, the city has seen a drop in property tax revenue, which is the major source of revenue. In 2010, the city collected $29,516,798. This dropped to $25,177,875 this past year.
"That is why we struggle and do what we can," said Walby, about the drop in property tax revenue over two years.
This trend is expected to continue in the coming year with an estimated 9.1 percent drop in taxable value before stabilizing in 2014 with a .5 percent increase.
"As impressive as last year was, we have our work cut out for us," Harrington said.
Although there was a drop in the taxable value, the city has seen an increase in license, permits and other fees from $1,461,538 in 2010 to $1,890,638 in 2012.
"(The increase in permits) could signal the economy is turning around," Walby said.