Eutaw City Council receives FY2021 Audit and detailed financial report showing progress but difficult decisions ahead

New police officer, Danny Morales, who is bi-lingual in Spanish and English, joined the Eutaw Police force. He is standing with Chief Tommy Johnson.

By: John Zippert, Co-Publisher

At last night’s regular Eutaw City Council meeting, the city received a 53-page audit report from Rick Harbin, CPA on the fiscal year ending September 30, 2021.

They also heard a report from Attorney Ralph Liverman, City Financial Advisor, on the first 9 months of the current fiscal year showing revenues over budget (104%) and expenses slightly over projections (88%) with a positive net cash position, with three months left in the fiscal year. Liverman also pointed out some long-term issues with the water, sewer and streets in the city which will require attention and increased expenditures in coming years.

Harbin presented the long-awaited audit report for last fiscal year ending on September 30, 2021. Harbin said he could not give an “unqualified” audit opinion because there were deposits made in the early part of the year, before the current mayoral administration took charge, which cannot be properly traced to their purpose.

He said he had to put a disclaimer on his opinion due to these concerns. “But as the year went on, the city set up a budget and an accounting system that can account for all income and expenditures,
so, I was able to provide an audit you can use for complying with agency conditions and seeking new funding,” said Harbin.

Harbin said the 2021 fiscal year, the City of Eutaw had $12.8 million in assets, with sufficient cash assets to meet current expenditures and have a new worth of about $3.2 million. Harbin distributed copies of the audit report and said he was willing to come back for a ”council work session” to explain things in more detail and answer any questions from the Mayor and Council.

Liverman reports on financial issues

The Council also heard a report from Ralph Liverman, Financial Advisor, on the nine months of the current fiscal year beginning October 1, 2021, through June 30, 2022, 75% of the year. He showed General Fund revenues from property taxes, sales taxes, privilege licenses, building permits, garbage fees, rent and other sources of income for the nine months was $2,493,338 (104%) of budget at $2,337, 716 for the year. This means the city in 9 months has already taken in more than its total annual projection of revenues with three months to go. There is a separate report for the Water and Sewage Department which was not reviewed.

Liverman also showed General Fund expenses for the City Administration (people in City Hall), Police Department, Streets and Sanitation, Parks and Recreation and the Fire Department which were budgeted for $2,195,962 for the year, had spent $1,953,378 or 88% of the budgeted amount for 75% of the time.

Liverman stated that the budget projections were based on limited information available and that the next budget would be more accurate. The budget had balances and surpluses built in to cover the spending incurred. For the year to date, with $2,494,338 in revenues and $1,953,378 in expenses, there is a surplus of $540,960, which may increase over the remaining three months of the year.

Liverman complimented the mayor, staff, and Council for a positive financial effort and moving the City in a positive direction. He then said there were some difficult and costly decisions ahead. First, the City must decide on how to deal with problems of the water system specifically in serving Boligee, where a major connecting waterline and lines in the town are leaking. The City has been offered a $3.5 million loan and grant combination by ADEM and USDA, but half is a grant and half is a loan, that the City cannot take on without assistance from the Town of Boligee.

There are also problems of the City providing water at no cost to the Greene County Water System, the City also provides water and sewer services to the Catfish plant at concessionary rates under a ten-year agreement, that expired in 2010 and has never been updated or renegotiated. The City may have to raise water rates and late fees, especially for those in Boligee.

Liverman also mentioned that the City’s sewage lagoon is 60-70 years old with many problems, which will take millions to repair. He also mentioned ten locations around the city where there are dangerous drainage problems. The City just spent $19,000 to repair a drainage ditch and curbing behind City Hall on Springfield Avenue. More expenditures are ahead to fix drainage throughout the city.

Other Business

The Council also heard a report from Brandon Broach, Assistant Fire Chief, on the condition of the city’s fire-fighting equipment. The Department has one certified and operable fire engine and a second engine that runs but is too old to be certified. The Fire Department has $150,000 in donated funds towards a second engine with a 40-foot ladder that can reach a third story building like some of the apartment complexes in Eutaw. A used fire truck that can be certified will cost $300,000, so more funds must be raised to get suitable equipment to save lives and retain a good rating for insurance purposes.

The Fire Department is all volunteer and needs younger members to get training and help fight fires, said Broach. There is also a need for a better budget for other equipment to fight fires.

The Eutaw City Council opened bids for caring for the roads and area around the Exit 40 intersection and going to Love’s Travel Center. Rev. William Webb’s -Total Care submitted a bid for $1,200 monthly, for services, twice a week. The bid was accepted by the City Council. The bid to maintain and care for the two city cemeteries – Mesopotamia and Thomas – was opened but the bid was not submitted properly on the form. This service was ordered rebid.

In other actions, the Eutaw City Council:
• Paid all bids and claims for June and July.
• Approved an agreement between the City of Eutaw and the Greene County Commission for the pavement of Choctaw Road, which is joint owned by both.
• Approved travel and per diem for staff to attend training.
• Approved a salary increase of $6,500 annual for Police Chief,
Tommy Johnson.
• Approved a Restaurant Retail Liquor License for the Cajun Café, LLC.

•Approved use of ARAP funds to give an incentive payment to city employees.



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