Purpose of Audit

The purpose of our audit was to examine the Town’s financial condition for the period January 1, 2012, to January 31, 2013.

Background

The Town of Stanford is located in Dutchess County and has population of approximately 3,800. The Town is governed by a Town Board that comprises a Town Supervisor and four elected Board members. The Town’s general fund appropriations for the 2013 fiscal year totaled $1.2 million.

Key Findings

• The Town’s budgets from fiscal years 2009 through 2012 were unrealistic. Total actual revenues during this period were approximately $1.3 million more than budgeted revenues, and total expenditures during this period were $340,669 less than appropriations. These unrealistic budgets caused unexpended surplus fund balance to increase significantly. At the end of 2010, the Town had $2.7 million in unexpended surplus fund balance, which was more than double the ensuing year’s appropriations. Further, at the end of fiscal year 2012, the Town had $1.3 million of unexpended surplus fund balance, which was projected to remain above 100 percent of the 2013 fiscal year’s appropriations.
• The Town continues to levy taxes unnecessarily even though it has excessive fund balance. Further, the Board has not developed a multiyear plan for the use of fund balance.

Key Recommendations

• Adopt realistic budgets that include the Town’s actual needs based on historical trends or other identified needs.
• Develop a multiyear financial plan which includes the planned use of the unexpended surplus fund balance in a manner that benefits Town taxpayers and provides appropriate transparency through the budget process. Such uses could include, but are not limited to, reducing the Town’s property taxes, funding one-time expenditures or establishing necessary reserves.