City’s audit sound
The city of South Lake Tahoe released its audit for the fiscal year 2000. And while the audit reported a clean bill of health, the city will need to deal with ways to pay for infrastructure and for health insurance benefits for city employees. It also raises questions about the Lake Tahoe Airport, which over the years has accumulated $1.4 million in debt from the city’s general fund.
“(The audit) is a positive message in the context of a sensitive financial picture, because we are going to have to make some changes,” said City Manager David Childs.
City Council will consider if it should count on the $1.4 million in revenues from the airport , which many think will not be paid back, especially without commercial air service.
In 1994 the city listed $362,000 of uncollected revenue from the airport. That figure increased by more than $1 million between 1994 and 2000.
Good news for the city is it collected more money and spent less than the projected budget for fiscal year 2000, which totals an additional 1.3 million in unexpected funds.
“I”m pleased with the report of the auditors, and I believe the city’s reserves are adequate,” Childs said. “But I remain concerned that we need to carefully monitor our revenues and expenditures to assure that we are able to maintain appropriate reserves, and that we not use one-time dollars to fund ongoing operational costs.”
The city is paying for health insurance premiums for city employees with one-time dollars and current revenues, but it will look at setting aside additional funds to ensure these payments in the future, said Treasurer Steve Weisong.
For fiscal year 2000, the city paid $212,000 for health insurance premiums for city employees, but projections indicate that figure will rise to $2 million a year in 25 years, Weisong said.
Childs said he will be working on one-year and five-year budget plans to help the city make intelligent financial decisions in the future.
Childs said the hotel and motel taxes were strong, despite the removal of hotels in the Stateline area for redevelopment. He attributes the figure to an increase in room rates because of a decrease in supply.
“The (Transient Occupancy Tax) revenues, so far this budget year, have been very strong in spite of the fact we have removed a lot of hotels at Stateline.”
The city has a fund balance of $6.7 million, which officials consider good. Of that fund balance there is $3.2 million, which is undesignated and can be used to contribute to other city accounts that need money such as infrastructure, which on Sept. 30, 2000 only had $26,000 in the account.
The $3.2 million, however, includes the $1.4 million that has not been received from the airport.
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