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Purcellville’s Town Audit Is In

January 5, 2012 by Valerie Cury filed under Government, News 1 Comment
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The Town has released the audit report for FY 2011, ending on June 30th. Formally called the Comprehensive Annual Financial Report (CAFR), it is available on the Town’s web site under “Finance Department Documents.” Although, most of the report is mundane there are a few parts that shed a light on the town’s financial status. Overall, the town “passes” the audit in that the financial data provided by the town to the auditors reflect the actual status. In other words, the town is not hiding anything from us. That does not mean that the town politicians do not try to put the most favorable spin on the town’s status.

Passing an audit report is akin to the town receiving an award for the budget, which it has for several years. The budget award is for the presentation of the budget items, not for the content. Indeed the town does tell the community a great deal of financial and budget information but with the budget being over 300 pages and the CAFR being over 100 pages, who has the time to read it let alone analyze it. While the town is very transparent in the planning process, they seem to be much less transparent when details of the execution of the plan are concerned.

Perhaps the most important aspect of the town’s finances is the amount of debt that this very small town has taken on. The General Fund debt went up by more than $6 million last year alone. Above is a chart showing the ever increasing debt on a per capita basis. Each citizen of Purcellville must ask themselves if they are comfortable with the town putting you in debt by almost $9,500. (By contrast, Loudoun County is in debt by approximately $4,000 per capita, and that includes all the school system debt.)

The other important aspect of the Purcellville budget that residents need to understand is the structure of the Town’s budget. Divided into three distinct budget funds, each has an Operating Budget and a Capital Budget. The figure below shows the budgeted amounts for FY 2011 – what the Town was required to spend.

Much ado has been made in the past of reported surpluses. This is where the politicians in Town put their spin on the situation. According to the audit report, “The unassigned ending fund balance [defined as monies not yet spent/allocated] for the Town’s general fund was $4.4 million, an increase of approximately $5,000 over the prior year.“ The Town’s press release on this issue talked of another “surplus.” But, the auditor’s report does not refer to it as a surplus. The spin only mentions the amount by which the General Fund Operating Budget unassigned fund balance increased, calling it a “surplus.” For this year’s report, the auditor stated that the General Fund increased its debt by over $6,000,000. Yes, they had $5,000 more left unspent in their checkbook for that particular fund. But, in order to accommodate the entire budget for FY 2011 the Town had to increase its debt by over $6 million – that is hardly a surplus.

If the citizens are happy with this amount of debt –with the politicians claiming to have a surplus when the Town actually went further into debt – then they should re-elect the Mayor and Town Council members this May. If they are concerned about this, perhaps they should vote for a non-incumbent who runs on a platform promising fiscal conservative management.

1 comment

  1. Bob L. says:

    What’s next for those pointless awards tramps on the TC, a blue ribbon for the font type used in the town hall sign? Or one for the ground-breaking red, yellow & green colors chosen for that absolutely ridiculous performance dashboard?

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