SPRING LAKE — The Spring Lake Board of Aldermen on Monday is scheduled to hear an update on the town’s finances from the Local Government Commission.
The board meets at 6 p.m. in the Grady Howard conference room at Town Hall.
David Erwin, accounting and financial management advisor for the N.C. Department of State Treasurer and the town finance director, is expected to give an update on the town’s financial situation through March.
Last year the Local Government Commission took control of Spring Lake’s finances. The commission had warned town leaders about long-standing financial disarray, concerns about potential budget deficits and investigations into missing money.
Monday night’s report is expected to show a positive revenue over expenditures in the town’s general fund. The property tax collection rate is at nearly 98%, according to the commission’s financial summary report for March. That is the town’s largest revenue source. However, the financial staff estimates that the expenditures will exceed revenues over the final three months of the fiscal year, according to the summary.
The Local Government Commission is concerned the general fund will have a negative fund balance, and the amount of that deficit can’t be determined until the 2022 audit is completed, according to the summary report.
Susan McCullen, the director of the fiscal management section of the State and Local Government Finance Division, said her staff is working with auditors to have a timely audit ending June 30. She said if there is a deficit, the General Statutes require it to be eliminated in a succeeding budget.
“It is imperative that Spring Lake continue to operate very conservatively as well as proactively fund the anticipated deficit fund balance in the 2023 budget,” McCullen said. “None of the current year’s positive balances should be viewed as available for new programs or expansion items in the FYE 2023 budget until the town’s financial condition can be fully assessed.”
Past discussions from the Board of Aldermen included lifting the furloughs that were put in place for town employees as a cost-saving measure to help balance the 2022 operating budget. The Local Government Commission has said that was not a prudent step at this time. The 5% furlough, which went into effect in July, reduced pay for all general fund employees and the Board of Aldermen. It also reduced staff hours, with the exception of police and fire, from a 40-hour workweek to a 38-hour workweek, closing Town Hall on Fridays to walk-in traffic. The town was reminded in March after the discussion that the Local Government Commission had assumed full control of the town’s finances.
Jami McLaughlin covers Spring Lake for CityView TODAY. She can be reached at jmclaughlin@cityviewnc.com. Have a news tip? Email news@CityViewTODAY.com.
