Determine whether the Town Board (Board) effectively managed the Town of Locke’s (Town’s) financial condition.
The Board did not effectively manage the Town’s financial condition. As a result, it levied more taxes than necessary to sustain operations.
- The Board did not adopt budgets with sound estimates, nor did it monitor budgetary results during the year.
- Unrestricted fund balances as of December 31, 2019 in the general and highway funds and water district were excessive, ranging from 89 percent to 536 percent of actual expenditures.
- The Board did not adopt formal fund balance, reserve and budgeting policies, along with multiyear financial and capital plans.
- Include more realistic estimates of revenues and expenditures when developing and adopting the annual budgets.
- Use surplus funds as a financing source for funding one-time expenditures, needed reserves and/or reducing property taxes.
- Establish budgeting, fund balance and reserve policies and develop multiyear financial and capital plans.
Town officials generally agreed with our findings and indicated they plan to initiate corrective action. Appendix B includes our comment on an issue Town officials raised in their response.