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1988.01.25_FAB_Minutes_RegularF_ TOWN OF HIGHLAND BEACH, FLORIDA FINANCIAL ADVISORY BOARD REGULAR MEETING - MINUTES Monday, January 25, 1988 9:30 A. M. A meeting of the Financial Advisory Board was held at 9:30 a.m. on Monday, January 25, 1988, at Town Hall. Members present included Richard Brunton, Ben Cohen, Grover Ensley, Fred Firstenburg, and Reese James. Also present throughout the meeting were Mayor Betty Jean Stewart and Chief Accounting Officer Stanley Novak. Following review and upon MOTION properly made and seconded, the Minutes of the January 19, 1988 meeting were accepted and approved as written. There were no new items of correspondence and the meeting proceeded with the agenda items. WATER RATES Mr. Novak provided the F.A.B. with additional data that had • been requested and this information, along with other data, was discussed during which it was noted that: 0 - There are some 3400+ dwelling units currently having access to Town water supply. - At lease some 60 additional dwelling units may be added during this calendar year. - The Town Commission is currently evaluating the long- term water water needs of Highland Beach, including possibly contracting with a neighboring community for supplementing future needs at an as -yet undetermined cost. - Not withstanding the desirablilty of establishing a water rate that could serve for a 3-5 year period so as to preclude the need for an annual review and rate setting, the above uncertainties suggest that an interior determination be made at this time. - The projected actual operating experience will show an approximate break-even point between revenue and expenses, including actual funding for depreciation. Financial Advisory Board • Regular Meeting - Minutes January 25, 1988 Page 2 of 3 In view of the above, the F.A.B. recommends that the water rates be retained at their current level, with a further recommendation that should an unforseen exigency occur, the Town Commission consider imposing a temporary surcharge to address the financial needs pending a resolution of the long-term provision of the Town's water needs. FISCAL 1986/87 BUDGET TRANSFERS This item has been scheduled for the F.A.B.'s next meeting. DECEMBER 1987 FINANCIAL REPORT Mr. Novak reviewed, in some detail, the actual versus budget experience for the first quarter of fiscal 1987/88. During the ensuing discussion, note was made of the accounts receivable in the Water Department including the fact that some users delay paying their accounts from 60-120 days. The F.A.B. understands that, although the Town's enabling ordinance (resolution) provides for a penalty to be assessed • for late payment, this has not been carried in actual practice. The F.A.B. strongly recommends that the Finance Department immediately implement the penalty provision for all over -due accounts. The rest of the report did not contain significant variation from budget and is recommended for acceptance by the Town Commission. 1986/87 AUDIT REPORT Coopers and Lybrand "Managing Partner" and the "Audit Manager" both were present during the review of this report. The "Managing Partner" reviewed the report on a page by page basis, allowing time for question and discussion in the process. During the course of the review it was noted that: - Both the audit report, as well as the "Report to Manage- ment" indicate that the Town's financial records are in an acceptable state. - Corrective steps are already in progress to address the "current year comments" contained in the "Report to Management". Not withstanding the drastic personnel turnover in the Finance Department, the audit indicates that the conversion to a computerized financial system has been • a significant factor in establishing and maintaining proper accounting practices. This has been a great improvement over the past three years. Financial Advisory Board • Regular Meeting - Minutes January 25, 1988 Page 3 of 3 - The Audit Manager agreed that further review should be made of certain expense items in the Water Fund to determine whether some of expenses should have been handled as a "capital item". Should this be the case, then the actual operating loss, as shown on page 21 of the audit report would be changed from some ($27,300) to some ($14,000), again including some $80,000 in funded deprecation. At the conclusion of this review, it was the sense of both the Audit Team, as well as the F.A.B., that the Finance Department is functioning in an acceptable manner albeit there are and will always be room for improvement. The F.A.B. recommends the acceptance of the Audit Report and Management Letter by the Town Commission. There being no further business, the meeting adjourned at 12:30 p.m., with the next meeting being scheduled for Monday, February 8, 1988, at 9:30 a.m. • REJ:elk cc: F.A.B. MEMBERS TOWN COMMISSION TOWN MANAGER • Re ctfully submitted, eese E. James, Chairman