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| City audit reveals surplus cuts into Magnolia deficit |
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The City of Magnolia was able to cut into its nearly half-million dollar deficit last year after it came away with a $26,157 surplus, according to the results of its annual audit.
City Council woman Patsy Williams proclaimed that the city is “back in the black,” after cutting back City spending dramatically.
Nathan Krupke of Belt, Harris and Pehacek, LLP reported the audit for the fiscal year ending in Sept. 30, 2010 at the regular City Council meeting held Jan. 11.
The audit reflected that the city earned $2,023,565 in total revenues and had expenditures totaling $1,997,408, resulting in a balance of $26,157.
The city started the year with a deficit of $493,587 acquired over previous years, so with the 2009-10 surplus, the deficit is now $467,430, according to the report.
Mendes said that the deficit is not owed to anyone, but rather money that the city is behind from years of being too optimistic with the budget.
For the fiscal year ending September 2010, the city projected they would earn $2,716,178, but Mendes said in previous years the projected revenue was much higher than the actual revenue.
“Having accurate estimates for what the year will look like will help,” Krupke said.
The report showed that there were two excess expenditures in the general fund. Public works spent $9,242 more than expected and debt service took an additional $6,000 more than expected.
Mendes said the city has made many budget cuts throughout the year and tried to watch city spending.
“Someone told me that we’ve done so much with so little, for so long that we can almost do anything with nothing,” he said.
Mendes said eliminating the deficit is going to take time, but overall he is content to see the progress. Comments (9)
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written by Cheryl Smith, January 17, 2011
Mr. Krupke is correct, as well as Ms. Williams. Basically, the city still has a deficit as a result of previous years of over budgeting. However, for 2010 the City of Magnolia was "back in the black," because they have a surplus from not over spending the 2010 revenue. Although the money is applied to the deficit, the city did not add to the deficit like previous years.
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written by Jake Bolton, January 17, 2011
Thank you Ms. Smith. To better understand this article is it fair to say that the city did not add to the deficit but also did not clear the deficit? If that is the situation isn't the city still short $467k that has carried over into each year?
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written by Cheryl Smith, January 18, 2011
Yes, the city did not add nor clear. They actually kept $26k in revenues for the year of 2010, according to the audit report. The deficit of $467 is debt carried over, but the deficit is lower than it originally started as.
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written by Jake Bolton, January 20, 2011
With all that said the bottom line is that Magnolia is still broke?
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written by Todd Kana, January 20, 2011
dictionary.com has the following definition for broke.
–adjective 4.without money; penniless. 5.bankrupt. Your conclusion is incorrect, the City is not broke. The deficit was not created overnight and it will not be eliminated overnight, but to continue to complain about something that is being corrected achieves nothing. I believe comments such as yours might be warranted if an entity refused to take action when alerted to a problem, but that is not the case here.
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written by Jake Bolton, January 20, 2011
Thanks for your response Mr. Kana but I was not complaining. You should not make a*sumptions. I was questioning the article as it was not clear. I don't understand why you are being so defensive. Glad to see you know how to visit dictionary.com as well as use the copy and paste option.
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written by Todd Kana, January 20, 2011
About what I expected.
I made no statements directed at you personally and find it odd you feel the need to respond in such a way. I post facts and statements occasionally for those that are seeking the truth or clarification. I am encouraged by family and friends not to do so because people make personal attacks for absolutely no reason. I believe it is because this is done in an anonymous forum. Rarely would civil people act the way they commonly do at their keyboard if they were standing in front of someone. I fail to see where I was defensive as you state. I never stated you were complaining, so what is the a*sumption you reference? I believe when I stated "but to continue to complain about something that is being corrected achieves nothing" you a*sumed I was talking about you. It is also common when writing to cite your source when quoting so as not to mislead others into thinking it was an opinion or definition of your own.
... written by Jake Bolton, January 20, 2011
Who where your remarks directed to? Only myself and Ms. Smith have posted any comments. While you may find it odd, I find your remarks to be arrogant and rude. I was simply trying to understand the article but you felt the need to quote the dictionary instead of adding to the conversation in a positive manner. Nice of you to give a written lecture about how civil people commonly act. Maybe your next lecture should be on rudeness.
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Which person is incorrect? Ms. Williams or Mr. Krupke?