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Audit adds up City gets high marks in report Senior Reporter Brainerd's 2005 audit received a good report card.
"The audit results are very positive," said Tom Koop, principal at LarsonAllen, at Monday's Brainerd City Council meeting. "That's a very good report for you to hear. ... The audit results are very clean."
The council received the approximately 125-page financial statement about five days ago and decided to set up a workshop with LarsonAllen in July to go into more detailed questions.
Sara Lusignan, audit manager, said looking at general and special revenue funds for 2005, almost 40 percent of revenues for the city come from state aid and local government aid and federal grants with property taxes bringing in 22 percent.
The largest expenditures for general and special revenue funds for 2005 came in public safety at 39 percent followed by public works at 22 percent.
The city is about two months shy of having a six-month benchmark in order to carry expenditures without any new money coming in. Koop said having reserves for six months is particularly needed at the end of December as the city doesn't see income for the first six months of the year.
Council member Mary Koep suggested the council have more time to review the audit and come up with written questions LarsonAllen could answer in writing.
Koop said written questions and answers can be laborious and he offered a two-hour workshop to examine individual funds. The council agreed.
Before the meeting, council member Bob Olson prepared a list of questions regarding the Brainerd Area Civic Center. He praised staff members, saying they had done an excellent job with fiscal responsibility for 2005.
Olson said he sees problems with the arena fund that should disturb all council members as the arena fund went from a $32,111 cash balance in 2004 to a $20,720 cash deficit in 2005. Olson pointed to declining revenues at the civic center.
"I think we are spending too much money on it," Olson said.
Koop said while ice time rates are fixed and the school district has trimmed back hours, the utilities have gone up. The center has more than $1 million in equity but in terms of cash flow is going in the opposite direction than desired, Koop said. He said the situation was not a crisis.
The question is whether the city wants to subsidize the arena or have it exist by user fees, Koop said. He said there are many cases around the state where the general fund does help out in a city's arena as there is no requirement the arena has to pay for itself or make a profit. Options include raising rates or dealing with expenses or a comfort level with some funding from the general fund, Koop said.
RENEE RICHARDSON can be reached at renee.richardson@brainerddispatch.com or 855-5852.
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