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FOR IMMEDIATE RELEASE
At its Tuesday Council Lunch meeting, Springfield City Council received the annual independent audit of the City’s financial reporting from auditor RSM, and a special audit by BKD on the U.S. Department of Labor America’s Promise grant, administered by the Department of Workforce Development. RSM’s yearly compliance report of the City’s federal expenditures, along with single audits of the America’s Promise grant and the Temporary Assistance for Needy Families (TANF) program through the U.S. Department of Health and Human Services, are still in development and will be released at a later date.
RSM gave an unmodified opinion – the highest level given – on the City’s financial reporting, showing no material weaknesses or significant deficiencies to report.
The City’s Finance Department prepares the Comprehensive Annual Financial Report (CAFR) each year, in compliance with the City Charter, which requires an annual report to the City Council on the financial condition of the City.The equity of the City at the close of the most recent fiscal year was $943.9 million, an increase of nearly $34 million over last year. This is also referred to as net position. Governmental activities increased the City’s net position by $14.8 million. Sales and use tax revenues, the largest governmental category, were $134 million, or 55%, of total revenues. Revenues from governmental activities totaled $244 million, or 72%, of the total City revenues. Sales tax increased approximately $3.1 million from last year due to improved economic conditions.
The largest portion of the City’s net position, $666.3 million (71%), reflects its investment in capital assets, e.g., land, construction in progress, buildings, improvements, machinery and equipment and infrastructure, less any related debt used to acquire those assets that are still outstanding.
The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. An additional portion of the City’s net position, $41 million (4%), represents resources that are subject to external restrictions on how they may be used. The remaining balance of the City’s net position, $236.6 million (25%) represents unrestricted net position that may be used to meet the City’s ongoing obligations to citizens and creditors.
The City's net investment in capital assets, such as buildings, roads and sewer systems, increased $9 million over the last year to more than $666.3 million.
The fund balance of the General Fund is $29.3 million – an increase of $1.9 million from last year.
The Finance Department received the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association (GFOA) for its Comprehensive Annual Financial Report for the 42nd consecutive year.
The department also received the GFOA Distinguished Budget Award for its budget presentation for the 14th consecutive year.
A special audit of the America’s Promise grant program, administered by the Department of Workforce Development, was performed in November by BKD at the request of City management. BKD’s findings indicate that 106 of the 376 participants in the America’s Promise grant program could not be classified as eligible due to incorrect categorization regarding employment status and/or county of residence during enrollment.
“The special audit by BKD was the start of a thorough review of the America’s Promise grant program,” said City Manager Jason Gage. “We are currently working with the U.S. Department of Labor to arrive at the final number of ineligible participants, determine whether the City will need to reimburse any of the grant monies, and most importantly, fix our enrollment processes so this does not happen again.”
The audit was requested by City management after Workforce Development and Finance department employees became concerned that enrollment processes may not have correctly assessed the eligibility of America’s Promise grant recipients.
The $3 million grant was awarded to the City of Springfield by the U.S. Department of Labor Employment and Training Administration in December 2016, with the period of performance of Jan. 1, 2017 through Dec. 31, 2020. The grants are designed to accelerate the development and expansion of regional workforce partnerships committed to providing a pipeline of skilled workers in specific sectors. Locally, participants choose one of six allied health care tracks to study tuition-free at Ozarks Technical Community College:
Those currently enrolled in the program will continue their studies, but the City has temporarily stopped accepting applications until the review is complete.
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For more information, please call Finance Director David Holtmann at 417-864-1632, or Director of Public Information and Civic Engagement Cora Scott at 417-864-1009 or 417-380-3352.