01/03/14 — Fremont hoping to improve finances

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Fremont hoping to improve finances

By Matt Caulder
Published in News on January 3, 2014 1:46 PM

FREMONT -- Following a less than favorable audit last year, Fremont officials are looking forward to a better report in the coming year.

In addition to a nearly $600,000 hit to the town's various fund balances, the town incurred three state violations stemming from its accounting practices, according to Andrew Harris, the accountant handling the audit.

Violations included over-appropriating money in the General Fund, not having a balanced budget due to the over-appropriation and spending restricted Powell Bill funds for general obligations.

Powell Bill money is appropriated by the state to municipalities to make repairs on non-Department of Transportation maintained streets, sidewalks, gutters and other transportation uses.

The audit showed that at the end of the year the town's entire General Fund, nearly $120,000, was made up entirely of Powell Bill money.

The town's total Powell Bill funds total almost $240,000.

Interim Town Administrator Barbara Aycock said the money was transferred from the restricted Powell Bill fund to the unrestricted General Fund to reimburse the town for Powell Bill expenditures during the year, but that none of the money was used.

It was done early because the town had no money in the General Fund to support the town, she said.

"It was used to cover us if the money needed to be spent," Ms. Aycock said.

She said it is normal to wait until the end of the year to make that transfer but the town was forced to move it earlier to keep operations going.

The town also was in violation of state law by over-appropriating money from the General Fund, leaving the fund almost $180,000 in the red. The move left the town with an unbalanced budget.

Former Town Administrator Kerry McDuffie was at the helm at the time.

"The town's not doing all that well, but we are on the right track with our new administrator and it's going to help the town," Alderman Leon Mooring said. "I'm very confident we'll get on track as long as we have her."

Mooring blamed the poor report on the cost of shipping sewage to Goldsboro for treatment and town officials not keeping a close enough eye on expenditures.

The installation of bigger windows at the town's sewage spray field will allow the town to treat more sewage itself, which will help with the high sewage costs, Mooring said.

He also said Ms. Aycock is watching expenditures more closely.

Alderman W.T. Smith said the sewage has put Fremont behind on its expenses as well as frivolous spending, though he did not identify any specific expenses.

"The state doesn't have a balanced budget. Look at all the trouble the (federal government) is in," he said. "We aren't that bad. I hope we'll do better, but sometimes you have got to do things you don't want to."

Harris noted financial practices that were not in violation of any policies but that he believes have the potential to be problems.

During the year the town made loans from the General Fund and Electric Fund to prop up the water and sewer funds, Harris said. The practice has been going on for about five years.