Leesburg Council receives favorable audit report, moves forward with sewer project

LEESBURG — After several delays due to city staff changes and January storm impact, Sherri Boley, an accountant with the Mauldin & Jenkins CPA firm, presented Fiscal Year 2016 audit findings to the Leesburg City Council Tuesday night that indicated the city finished the year with improved financial positions in both its general fund and water/sewer fund.

“She basically said the city of Leesburg was in good financial health,” City Manager Bob Alexander said after the meeting. “I felt pretty good about that.

“As far as net cash, there was a net cash increase in both the general fund and in the water and sewer fund.”

According to the audit, the city began the fiscal year with a general fund balance of $612,826 and ended the year with a general fund balance of $654,649. The water and sewer fund had a net position at the beginning of the fiscal year of $9,906,122 and finished FY 2016 with a net position of $10,050,572.

Alexander did point out that materials presented to the council show that part of the increase in the cash position of the general fund was the result of a $100,000 transfer to that fund from the water and sewer fund. Alexander said without that transfer, expenditures exceeded revenue in the fund.

“If we hadn’t transferred that $100,000, it would have been a little bit on the negative side as far as revenue to expenses, but nothing significant,” he said. “On the water/sewer revenues, the expenses were a little bit higher than the revenues. However, part of that was the amount of depreciation, which is not really a cash expense.

“That’s the reason that we were a little bit higher on our expenses than our revenues. Without the depreciation, we would have been a lot higher on our revenues than expenses.”

Alexander said there was discussion among council members concerning the depreciation, which for FY ‘16 was $328,000.

“I pointed out to them that in the budgets for FY ‘13 and ‘14 there was no depreciation expense,” said Alexander. “Then in FY ‘15 we included $200,000 in depreciation expense, and in FY ‘16 we included $328,000 in depreciation expense. I think it’s the same amount in FY ‘17.

“I’m not sure that as far as the budget goes that they had been doing a depreciation expense until FY ‘15, when I included that in the budget.”

With the audit complete, the city manager said the next step is submitting it to the Georgia Department of Audits and Accounts, which will occur prior to the recently approved June 30, 2017 deadline.

“We received an extension because of not everything being ready by staff and by Mauldin & Jenkins, so we asked for (and received) an extension on that,” Alexander said. “We had a change in personnel that kind of slowed things down. So that was the main issue. When you have a small staff and some of your personnel leave, that slows things down a little bit.

“But we’ll turn this audit in in plenty of time. We’re in good shape.”

Following the audit presentation, Alexander said the board approved a contract with Still Waters Engineering to handle an upcoming sewer project being funded by a $500,000 Community Development Block Grant administered by the Georgia Department of Community Affairs.

That project, Alexander said, consists of the installation of 4,100 feet of 8-inch sewer line that will run south from a public housing neighborhood off Kinchafoonee Creek Road to the city’s lift station behind Hardee’s.

“It’s a real wet area there,” said Alexander. “We had some videos that show how much infiltration there was coming into that pipe. That’s certainly something that you want to avoid because when you have a real rainy day, all that water goes into the pipe and goes out to the sewer treatment plant and it just adds additional load to the plant that we don’t want to have.”

Still Waters will handle the project partly because the firm did the preliminary engineering work submitted to the DCA to help determine if the project was viable and met the parameters for the CDBG. With the city’s approval in place, Alexander said Still Waters will complete the design and engineering work and will likely put out a bid request on the project in the next few months.

“I think it will take them close to a year to finish this project,” added Alexander. “We certainly want to have this project finished, or the majority of the project finished, within a year or so that we’re in a position to apply for an additional award. We’re eligible to apply every two years for an infrastructure award with the Department of Community Affairs, so we want to move with this project as expeditiously as we can.”

In other matters, Alexander said the council approved a change order for Zane Grace Construction in relation to the site work the company is doing on the property surrounding the historic Leesburg train depot. Zane Grace won the contract earlier this year with an original project cost of $143,989.

Since that time, Alexander said, it was determined in pre-construction meetings that additional work needs to be done, including the installation of a new irrigation system, additional landscaping, the installation of additional sidewalks to connect the north and south parking lots, the installation of handicap ramps to allow better access to the building, improvements to the sewage system and additional grading to allow for better drainage under the south end of the building.

The $46,945 change order raises the project cost to $190,934, and Alexander said Zane Grace will begin the work on April 24. Weather permitting, it is expected to take the company 60-90 days to complete the project. Once that site work is complete, Alexander said Fourth Street Design and Construction, the firm that recently completed renovations to the depot’s exterior, will begin work on the building’s interior.

Although they took no further action, council members heard a presentation about Park Senior Village from Property Manager April Perry and heard regular financial and departmental reports from city staff.