SEBREE, KY (2/8/12) – At the council’s meeting Monday night, Sebree City Council members spent the majority of their approximately 35 minute meeting listening to an auditor’s report regarding the district’s finances for the last fiscal year.
Jud Royster of the Kemper CPA Group, who prepared the report for the city, told council members the last three years have been “deficit years” for Sebree with regard to revenues and expenses in the city’s water and sewer funds. According to information provided during the presentation, the city’s expenses for water and sewer have totaled as much as $800,000 annually since 2009, while revenues collected on those bills never reached $700,000. In fact, the revenues collected in 2011 were the lowest they had been since 2008, according to the report.
Not all of the expenses were directly related to the distribution of water or to sewer usage, though when compared to other years, the cost of the service has increased significantly. Royster said the city saw an approximately $18,000 increase in its water and sewer bill. The rates are set by the Henderson municipality, who provides the service to Sebree.
Royster said the city’s cash flow situation is something that will require serious attention from the council in order to address the growing deficit. He said typically, cities will set aside funds each year to go toward the cost of renovation or new construction needs, based on the amount of depreciation of existing infrastructure.
“You’re not doing that,” Royster told the Sebree City Council. “You’re just breaking even with the cash flow.”
The city ended the year with a deficit of almost $101,500, according to the report. It collected about $429,000 in revenues, but spent out nearly $529,800 in expenses during the 2011 fiscal year.
After the presentation, Royster then reviewed the official audit report of the city, and noted that Sebree had a total of approximately $40,000 in “bad debts,” which Sebree Mayor Ron Todd attributed to “a large number of water leaks” that had to be repaired last year. He said the city couldn’t collect money for the leaks, and had to pay for the work done to repair them. Royster agreed the leaks played a large role in the expense.
The council approved a motion to accept the audit report after approving an unrelated motion authorizing the second reading of an ordinance amendment that increases the cost of some gravestone markers from $20 to $25.
Before adjourning, Sebree Council member Ozzie O’Nan asked about the recent change to parking on the street next to the post office. Todd said the decision to install “No Parking” signs was made in conjunction with a church that gave its approval to the change. He said he didn’t know if the new parking arrangements would help address traffic flow concerns along the street, but that “doing nothing wasn’t satisfactory for me at this time.”
“If it doesn’t work, we can always change it back,” he told O’Nan.
Todd then told the council the city had received a letter from the Henderson water company that provides water services to the city, indicating an upcoming rate increase for water and sewer services to city customers. Todd said he didn’t want to discuss the rate changes until after he and the city’s water committee had had a chance to meet with the water municipality’s representatives to discuss the issue.
The Sebree City Council is scheduled to meet again on Monday, March 5.
Dennis Beard
Journal Enterprise
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