town of winthrop town of winthrop 1 financial overview presented by: greg chabot runyon kersteen...

Town of WinthropTown of Winthrop

Town of WinthropTown of Winthrop 11

Financial OverviewPresented by:

Greg Chabot

RUNYON KERSTEEN OUELLETTE

Recently, the Town of Winthrop completed the financial audit process. The Town received an unqualified opinion for fiscal year 2007.

Our report on internal controls discloses three significant deficiencies, none of which was deemed to be material weaknesses.

The remainder of this publication is dedicated to providing you with the financial results for fiscal year 2007 as well as trend information for certain areas.

We hope you find this information useful and understandable. Finally, we wish to express our appreciation to Jan and Elaine and all the members of the Town’s finance staff who were so helpful to us during the audit process.

FINANCIAL STATEMENT PRESENTATIONJune 30. 2007

INSIDE.1. Assets2. Liabilities And Fund Equity3. Revenues And Expenditures Tables5. Revenues And Expenditures - School6. Property Tax Collections7. Fund Balance Analysis8. Revenues And Expenditures Charts9. Other Funds and Conclusion

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

2007 2,603,685 124,350 425,496 8,971

2006 2,092,882 225,685 448,536 7,511

Cash & Invest Acct RecTax Rec &

LiensInventory

SUMMARY OF SIGNIFICANT CHANGESGENERAL FUND

•Cash and investments increased overall by approximately $511k. For the purposes of this presentation, cash and investments are presented net of interfund loans, thereby representing General Fund cash only. The increase in cash was the result of an excess of revenues over expenditures of $571,117 offset by a decrease in payables and accruals and deferred tax revenue which represents a non cash revenue source.•The decrease in receivables was primarily school department.•Outstanding taxes and liens decreased by $23,040 as the collection rate remained steady increasing slightly from 95.09% to 95.54% on a commitment that increased by $179,846.

Key Performance Indicators

GENERAL FUND ASSETS



GENERAL FUND LIABILITIES

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2007 156,582 767,457 4,190 319,844

2006 259,891 789,875 2,107 379,429

Accts payable

Accrued wages

Taxes paid in advance

Deferred tax revenue

SUMMARY OF SIGNIFICANT CHANGES

The most significant liability, accrued wages represents payroll earned prior to June 30th but not yet paid. The majority ($659,239) consists of teachers summer pay.Deferred revenue represents taxes still unpaid 60 days after the end of the year. These amounts are not recognized as revenues in the current year.

(500,000)

0

500,000

1,000,000

1,500,000

2,000,000

GENERAL FUND EQUITY

2007 100,137 1,910,173 80,516 (176,397)

2006 9,500 1,825,169 0 (491,357)

Desgnated UndesignatedDesignated

SchoolUndesignated

School


•Detail for designated balances is on page 26 of the financials. •Town undesignated fund balance increased by $85,004 as a result of positive revenue and expenditure variances offset by the use of fund balance for the revaluation and for separation pay.•School fund balances increased by $395,476 on a GAAP basis. Favorable expenditure variances of $401,784 were partially offset by unfavorable revenue variances of $6,308. Without the summer teacher salary accrual of $659,239, fund balance would be $563,358 including a reserve for teacher summer salaries of $142,283 and designated balances totaling $80,516.



2007Budget Actual Variance

Property taxes 7,303,851 7,365,162 61,311 Excise taxes 975,000 1,009,002 34,002 Intergovernmental revenues 6,087,391 6,078,668 (8,723) Outside sources 549,634 516,349 (33,285) Interest revenue 21,000 88,024 67,024 Miscellaneous 592,386 776,519 184,133 Total revenues 15,529,262 15,833,724 304,462 Use of fund balance 188,699 - (188,699) Total revenue and other sources 15,717,961 15,833,724 115,763

SUMMARY OF SIGNIFICANT CHANGES•Tax revenues were more than anticipated as a result of a decrease in deferred tax revenues of $59,585. Excise taxes exceeded budget by 3.49% and prior year excise by $3,982 (.4%). Intergovernmental revenues was less than budget in State education subsidy ($29,646) and Medicaid ($20,337) but over budget in State revenue sharing ($32,110) and other categories. Outside sources was under budget primarily as a result of dispatch revenues being less than anticipated.Miscellaneous revenues exceeded budget primarily as a result of various transfer station revenues (including PERC distribution) exceeding budget as well as school department tuition exceeding budget.

GENERAL FUND REVENUES




Health and welfare exceeded budget due primarily to solid waste disposal tipping fees, fuel and maintenance expenditures partially offset by general assistance payments.The School Department was under budget in expenditures but also slightly under budget in revenues by $6,308. See A-3 for a more detailed breakdown of Education expenditures. Transfers out were over budget due the establishment of the Winthrop Unites fund.

2007

Budget Actual Variance

General government 1,155,950 1,155,454 496

Public safety 1,581,322 1,554,227 27,095

Health and welfare 505,955 515,314 (9,359)

Recreation and culture 231,361 223,928 7,433

Education (excluding debt service) 8,303,931 7,902,147 401,784

Public Works 417,141 394,095 23,046

Unclassified 183,459 172,544 10,915

County tax 483,099 483,099 -

Overlay/abatements 13,527 2,593 10,934

Debt service - Principal 1,591,498 1,591,498 -

Debt service - Interest 640,069 640,064 5

Exp from Fund Bal - Revaluation 163,868 163,868 -

Exp from Fund Bal - Separation Pay 7,161 7,161 -

Exp from Fund Bal - Other 8,170 8,170 -

Capital Outlays 29,500 30,495 (995)

Operating transfers out 401,950 417,950 (16,000)

Total expenditures and transfers 15,717,961 15,262,607 455,354

GENERAL FUND EXPENDITURES



Budget Actual VarianceProperty taxes 4,890,353 4,890,353 - Intergovernmental revenues 5,143,890 5,094,204 (49,686) Miscellaneous 222,500 265,878 43,378 Total Revenue and transfers 10,256,743 10,250,435 (6,308)

SCHOOL DEPARTMENT REVENUES

SCHOOL DEPARTMENT EXPENDITURESBudget Actual Variance

School Committee 83,742 76,788 6,954 Office of Superintendent 359,399 292,816 66,583 Workers Comp/Unemployment 4,000 15,067 (11,067) Service Learning Program 10,000 4,970 5,030 Central Technology 283,548 265,020 18,528 Grade School 1,603,680 1,553,741 49,939 Middle School 1,191,635 1,152,933 38,702 High School 1,896,511 1,823,527 72,984 Exceptional Education 1,027,382 1,022,220 5,162 Gifted and Talented 136,458 113,135 23,323 Health Services 81,273 88,712 (7,439) Student transportation 486,892 449,710 37,182 Maintenance and custodial 1,066,029 1,043,508 22,521 Summer salary reserve 73,382 - 73,382 Debt service - Principal 1,130,398 1,130,398 - Debt service - Interest 537,414 537,414 - Operating transfers out 285,000 285,000 - Total expenditures 10,256,743 9,854,959 401,784



PROPERTY TAX COLLECTION RATES

80%

82%

84%

86%

88%

90%

92%

94%

96%

98%

current years 94.04% 92.76% 92.90% 94.00% 97.00% 96.14% 95.63% 95.72% 95.09% 95.54%

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007



FUND BALANCE ANALYSIS FY 1998 - 2007

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

Designated 30,346 195,543 122,195 27,821 92,117 511,800 13,229 12,971 9,500 180,653

Undesignated 607,391 663,190 882,359 986,620 967,155 558,587 569,329 903,582 1,333,812 1,733,776

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

OBSERVATION

Winthrop’s undesignated fund balance increased by $399,964 as a result of overall positive revenue and expenditure variances. Undesignated fund balance increased by $85,004 for the Town and $314,960 for the school. Undesignated is currently at 11.17% of budget up from 8.97% of budget in 2006, after including teacher summer salaries liability of $659,239. Credit rating agencies typically look for a minimum ratio of 5%. RKO typically recommends one month of expenditures which equals 8.33%. The Town’s fund balance alone is 12.3% of budget offset by the school deficit of $176,397 that results from teacher summer salaries.



UNDESIGNATED FUND BALANCE AS A % OF BUDGET

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

Percentage 5.65% 5.98% 7.76% 8.69% 8.29% 4.46% 4.20% 6.30% 8.97% 11.17%

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007



UNDESIGNATED FUND BALANCE - TOWN AND SCHOOL

(800,000)

(600,000)

(400,000)

(200,000)

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

Town 1,186,36 1,119,824 1,170,81 1,384,28 1,534,984 1,580,29 1,227,777 1,269,720 1,633,269 1,825,169 1,910,173

School (283,189) (512,087) (507,628) (501,928)(548,364) (613,143)(669,190) (700,391) (729,687) (491,357) (176,397)

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007



2007 REVENUES AND EXPENDITURES – GENERAL FUND

Interest revenue0.56%

Property taxes46.52%

Intergovernmental38.39%Excise taxes

6.37%

Outside services3.26%

Miscellaneous4.90%

Operating transfers out2.74%

Exp from fund balance1.17%

Capital Outlays0.20%

General government7.57%

Overlay/abatements0.02%

Public safety10.18%

Debt service - Town only3.69%

Health and welfare3.38%

Education debt service10.93%

Public Works2.58%

Recreation & culture1.47%

Education(excl. debt service)51.77%

Unclassified1.13%

County tax3.17%



OTHER SIGNIFICANT FUNDS - FUND BALANCES -

SCHOOL NUTRITION

(240,000)(220,000)(200,000)(180,000)(160,000)(140,000)(120,000)(100,000)(80,000)(60,000)(40,000)(20,000)

-20,00040,000

31,705 (114,119) (201,812) (209,687) (73,185) (125,665) (206,932) (231,259) (148,831) (89,992)

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

FINAL WORDSThis presentation is intended as a tool to assist the Town Council, Board of Education and management in understanding its financial

operating results.The information contained in this publication should be read in

conjunction with the audited financial statements andrelated disclosures and should not be used for any other purposes

without the expressed consent ofRUNYON KERSTEEN OUELLETTE

Please contact us at 207-773-2986 or 1-800-486-178420 Long Creek Drive, South Portland, ME 04106

FINAL WORDSThis presentation is intended as a tool to assist the Town Council,

Board of Education and management in understanding its financial operating results.

The information contained in this publication should be read in conjunction with the audited financial statements and

related disclosures and should not be used for any other purposeswithout the expressed consent of

RUNYON KERSTEEN OUELLETTEPlease contact us at 207-773-2986 or 1-800-486-1784

20 Long Creek Drive, South Portland, ME 04106

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