White to discuss water rate
by Mark Andrews
May 06, 2011 | 1620 views | 0 0 comments | 6 6 recommendations | email to a friend | print
BThe city of White received the preliminary results from their 2010 audit this week and it was suggested by the auditor the city increase water rates.

Lloyd Williamson, of Williamson and Company CPA's performed the audit for the city.

"Your net income from operations went from a $128,000 loss to a $145,000 loss, so if you were a business you would have to think of something," Williamson said. "You can only lose money for so long, you've got to start making money to cover your operating costs."

City manager Jane Richards said there would be discussions with the city's engineer and attorney before considering a rate increase.

"What I plan to do with our engineer is to do a rate study and see how we compare with other small cities around us," Richards said Wednesday.

Councilman Dennis Huskins expressed concern over the effect of a rate increase could have on some of the city's residents.

"You've got elderly and you can't keep going up on them, or on a household full of people struggling for work," Huskins said. "They'd be getting [an increase too], and they're not using that much [water]."

Williamson said there might be options for assisting elderly residents in terms of a rate increase.

"I've seen where some cities have given -- like a county with property taxes -- as you get to a certain age you're put in a bracket, then when you're 70 you're in another bracket, so you can exempt households," Williamson said. "They may have to bring in a copy of their tax return or driver's license to show they qualify for what you might offer, but that's something to consider."

Richards again said the city would consult its attorney to discuss financial options.

Despite the depreciation expense, Williamson said the city fared well in the audit.

"Your [general fund] assets increased $97,000, and of that, $65,000 was an increase in cash, which is not too bad in the current economy," Williamson said.

The city's total liabilities and fund balance increased from $1,046,265 in 2009 to $1,143,436 in 2010, for an overall increase of $55,661.

The report showed a $25,776 decrease in tax revenue from 2009 to 2010, with the largest decrease coming from a $14,811 drop in sales tax. However, the decrease was offset by a $27,287 increase in other revenues, showing an $18,157 increase in fines and forfeitures and leaving the city with an increase of $1,491 in revenue.

Expenditures were down $1,243, with a $21,691 decrease in police expenses, which Richards attributed to last year's purchase of a police vehicle.

The city's water and sewer department saw a $1,916 drop in total operating revenues from 2009 to 2010 and an operating income loss of $18,035.

"Depreciation is a big expense, that's $150,000," Williamson said, "and if you backed that out then yes, you would have a profit."

This year depreciation expense went up $16,000 from $134,535 to $151,0089.

Williamson said the depreciation expense also contributed to total net assets decreasing $70,578.

"Really, we weren't minus $70,000, but when they add in that depreciation, it makes it look that way on paper," Richards said. "We didn't over-spend, and we actually spent less."

In other city of White news, the city completed a task order required by the United States Department of Agriculture-Rural Development to extend more than 1,500 feet of sanitary sewer from Old Tennessee Highway to Barry Drive.

The extension is to be funded by a $95,200 Appalachian Regional Commission grant and Special Purpose Local Option Sales Tax funds. Richards said the project will start this month and is separate from the city's Phase II project, which is expected to provide sanitary sewer to 140 residential customers in the next eight months.