City counts on good
finances for new year
Amid challenges, a sound fiscal picture is giving some hope to the city of Hermann for glimmers of prosperity occurring later in 2021.
In December, city leaders received an independent auditor's financial report that covers the fiscal year ending June 30, 2020. Its narrative analyzes all facets of Hermann city government's revenue and spending. Hochschild, Bloom & Company LLP, a member of PrimeGlobal, prepared the report. The CPA firm has a satellite office in Washington, Mo.
The auditors said the city's assets exceeded liabilities by $24.6 million. The bulk of those assets are contained in capital such as land, buildings, machinery and equipment, and infrastructure, according to the analysis, that are unavailable for future spending. It added that the city may use approximately $6.6 million to pay creditors. The report further stated that the city had an ending fund balance of more than $1.1 million, reflecting an increase of almost $292,000 over the previous year. The unassigned fund balance for the General Fund was nearly $164,000.
Among other highlights from the report, the Parks Fund grew by almost $7,500 -- resulting in a total fund balance of more than $218,000. The Parks Fund revenues were almost $25,000 over budget, while spending was over $68,000 under budget. The Electric Fund decreased by nearly $58,000, finishing the year at nearly $7 million. The Water Fund increased by $72,000, ending at $1.7 million.
"This increase was a result of revenues being higher than expenses," the auditors noted.
That was also the case for the Wastewater Fund, which expanded by $66,000 and resulted in an ending balance of slightly more than $1 million. The Natural Gas Fund increased by $148,000 -- again with revenues higher than expenses -- to conclude the fiscal year at $3.4 million. The Airport Fund's final balance was close to $236,000 after experiencing a $38,000 increase.
The auditors did issue a cautionary note to city officials in light of the pandemic.
"As a result, economic uncertainties have arisen which could adversely affect certain revenues, expenditure, and net income," the report stated. "Other financial impacts could also occur, though such potential impacts are unknown at this time."
On Friday, Mayor Bruce Cox told the Advertiser-Courier one aspect of city finances of high concern to residents is found in the plans for ongoing street improvements. Cox said a definite schedule for Hermann streets to receive attention remains unclear for now.
"It'll be in the fall," he said of the next round of street work. "It all depends on the tax dollars."
Cox said a check of the city's coffers could yield an optimistic outlook for the year.
"Our sales tax and our bed tax were beyond our expectations," he said, noting that Hermann's tourist activity continued in 2020 despite COVID-19. Tourism-related businesses in the city have already had "pretty steady" inquiries, he added.
Several new businesses for Hermann may be another sign of a good year, according to Cox.