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Taxpayers' Guide to State and Local Audits

Audits of Local Governments and School Districts

Town of Yates – Water Improvement Area Capital Charges (2011M-221)


Released: February 10, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to examine the special assessment imposed upon property in Water Improvement Area #4 for the period January 1, 2010 through August 3, 2011.

Background

The Town of Yates is located in Orleans County. An elected five-member Town Board is the legislative body responsible for overseeing the Town’s operations and finances. Town expenditures are funded by property taxes, sales taxes, State aid, user charges, fines, and miscellaneous fees.

Key Findings

  • The annual special assessment charge levied by the Board upon real property located in Water Improvement Area #4 was excessive. For the last five completed fiscal years (2006 through 2010), we found that the assessment charges exceeded debt service costs by approximately $21,000 to $40,000 annually. Consequently, results of operations have generally produced year end surpluses which have increased the Water Improvement Area #4 fund balance. The reported unreserved, unappropriated fund balance in this fund was $387,659 at December 31, 2010, which was 123 percent of its total appropriations of $316,200 for 2011.
  • Town officials did not lower the special assessment charge to an amount that was sufficient to fund debt service charges.
  • The Board did not distribute this charge to benefited parcels in an equitable manner. Beginning in 2001, Town officials did not charge an assessment to parcels that did not have water service available.

Key Recommendations

  • Annually calculate the special assessment rates necessary for Water Improvement Area #4 and fully document how it determined the rates.
  • Reduce fund balance to a more reasonable level.
  • Charge all parcels in the improvement area for debt service associated with the treatment plant and the water storage and transmission system in the manner indicated in the 1993 resolution.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236