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Toledo, Ohio & Lake Erie

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Oregon City Council on Monday will consider authorizing Finance Director Kathy Hufford to make supplemental appropriations and interfund and intrafund transfers on an as-needed basis for fiscal year 2011.
 
Hufford at a committee of the whole meeting on Feb. 7 called the proposed ordinance a standard item.
 
“This includes all the transfers that were included in the 2011 budget, and also includes items that are reconciling the 2010 transfers from the budgeted amount to the actual cost that were incurred in 2010,” she said.
 
There are also supplemental appropriations for Information Services for Capital Expenditure items that were not included in the 2011 budget, an appropriation for the fire department for a grant from The Andersons for the purchase of ice and/or water rescue equipment, and an appropriation for additional costs for the Big Ditch project, she said.

Councilman Sandy Bihn asked about an interfund transfer of $198,338 from the Sewer Revenue Fund to the Water Revenue Fund, and a supplemental appropriation of $198,338 in the Service Wastewater Administration.
 
“I just wonder why this wasn’t caught either in an audit or through internal controls, because I think that is a significant amount of money and wonder how this came to be where it’s this far off,” said Bihn.
 
Administrator Mike Beazley called it a case of human error.
 
“Over a period of years, this is an item that we didn’t reconcile, but at some point in the recent past, the failure to reconcile was picked up on and hence this larger reconciliation. If you’re wondering if it’s a question of human error, the answer is, `yes,”’ said Beazley.
 
“So this has been understating the amount of money that we’ve been getting in the water revenue fund, and overstating the amount in the sewer revenue fund. Is that essentially what’s going on here?” asked Bihn.
 
Hufford said yes.
 
“I guess in response to that,” said Bihn, “as we look at this, I just wonder how close we are in our rates. This is a fairly substantial amount of money. I always like the rates to be as close to the cost as possible, unless we’re putting it away into some fund for infrastructure, which I actually think is badly needed on some of our old pipes and things. I would like some analysis of how our rates are doing and where they all shape out and what the administration sees in terms of what’s going on with the water and sewer revenue funds.”
 
Beazley said Oregon is one of the few communities in the region that funds a portion of its utility costs with  income tax revenue.
 
“And it seems to have worked well for the community historically,” said Beazley.
 
With the recent increase in utility rates in Toledo, Oregon now has the lowest utility rates in the area, said Beazley.
 
Bihn said she would like the administration to review the surplus in the water and sewer revenue funds.
 
“As I read the condition of funds, it looks like the beginning year balance in the water revenue fund was $2.9 million and the sewer revenue fund was $1 million. There’s a substantial surplus in the water revenue fund, and I understand we need the infrastructure, so I’m very sensitive to that. I just wonder how much of a surplus we should have, or how that should be addressed, or how we make these decisions and how we develop policy. I’ll just leave that up to people to contemplate and get some feedback later on,” said Bihn.
  

 

 

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