Plante Moran give update on city finances
Carolyn Marnon – Many associate the month of March with the color green. St. Patrick’s Day boasts green beer and green leprechauns. The coming of spring heralds the renewal of trees and plants to lush greenery. One other item that is green is money. We’re often told money doesn’t grow on trees. If it did, I am sure we would all have been at Aldi’s when they recently had Money Trees for sale. Alas, these plants would never sprout the dollar bills we would so love to have in our City.
Brian Camiller, a partner at Plante Moran, has been helping the City of Wayne restore financial stability during economically depressed times. Mr. Camiller recently addressed Wayne City Council to give an audit report and financial update on the City’s finances through the fiscal year ended June 30, 2019.
The presentation of the City’s finances received an “Unmodified Opinion.” “This is like getting an ‘A’ on a report card,” said Mr. Camiller. The auditor’s report, done by Alan C. Young & Associates, does not address the financial well-being of the City, only that statements are materially correct and can be relied upon. “This is a very good report for the City.”
The Government Finance Officers Association (GFOA) recommends the General Fund has a minimum of two months of expenditures in the fund balance or 16.67% of the years expenditures. As of June 30, 2019, Wayne had 14.7% in the General Fund. The City’s amended FY 2020 budget includes an operating loss of $1.5 million. As of June 30, 2020, Wayne’s General Fund balance would be at 6.31%.
The City has made significant improvements since 2014. The budget process has been redesigned so that the City now knows what revenue is coming in and what expenditures are going out.
The Recreation Center was closed and then outsourced to HYPE Athletics. Changes have been made to healthcare, most notably the change to a retiree stipend. Capital outlay has been delayed meaning the City is still using older equipment. SAFER and other grants are being utilized. Staffing vacancies are not being filled, and many other sacrifices are being made by City staff, retirees and citizens.
The Great Recession hit Wayne hard. From 2010-2019, the City has lost over $60 million in tax revenue. Property taxes are the largest source of revenue in Wayne.
The City has been able to prevent State intervention while focusing financial efforts on cost containment. Mr. Camiller’s power point presentation states “At this point, further containment or reduction may require reduction in service levels.” The City still needs to address issues with capital outlay, facilities, compensation and technology. If/when another recession arises, the city will face severe financial adversity with even fewer options to utilize over what has already been done. In summary, the City of Wayne needs a new, sustainable revenue source.