Flint Township receives “A” rating in latest audit report

FLINT TWP. — Flint Township has received favorable feedback on its most recent audit report.

At the July 20 Flint Township Board of Trustees meeting, auditors with Plante Moran presented an overview of Flint Township’s 2019 fiscal year, including summaries of the township’s general fund revenues and expenditures, police and fire funds, sewer/water funds, legacy costs and OPEB funding.

Chris Gilbert, an audit partner with Plante Moran who managed the audit, said that the township achieved an “A” rating for monitoring its expenses and maintaining a positive general fund balance of about $4.5 million.

During the 2019 fiscal year, Flint Township’s three largest revenue areas came from property taxes (37 percent), state shared revenue (30 percent) and special assessments (15 percent). The township’s total revenue was $10.3 million—a $53,000 increase from revenue in 2018.

General fund expenditures for 2019 were around $10.7 million, which was a slight increase from the 2018 expenditure total of $10.5 million. Public safety (56 percent) and general government spending (28 percent) accounted for most of the township’s expenditures.

The township’s 2019 police and fire millage fund balance stood at $1.4 million, with expenditures coming in at $3.1 million and annual revenue accounting for a little over $3 million.

Meanwhile, a review of the township’s sewer/water fund showed that revenue was slightly more than expenditures for 2019. However, Gilbert said that the fund balance margin has continued to shrink over time, and that the current balance in the fund won’t be enough to address future infrastructure repairs.

“Over the last couple years, we’ve seen a trend where expenses are increasing at a more rapid rate, while the revenue has been pretty stagnant,” Gilbert said. “Another consideration will have to be made in how to you choose to adjust the rate structure to pay for (the fund) over the long term.”

Flint Township Supervisor Karyn Miller said that the township is conducting a study of its water and sewer department to determine the age of the infrastructure and look for areas that need to be improved or repaired. She also said that a rate study will be considered.

Flint Township hasn’t increased sewer rates since 2009 or water rates since 2011.

In terms of legacy costs, auditors also reviewed the township’s MERS plan for clerical and non-union police officers and firefighters hired after Jan. 1, 2012, and the township’s pension plan for firefighters hired before Jan. 1, 2012. While the former plan was funded at 57 percent, the latter plan was funded at 75 percent.

Flint Township’s net OPEB liability for 2019 was $20.5 million, which was a $5.4 million decrease from the previous year. As a result, the plan went from 1 percent funded in 2018 to 2.2 percent funded in 2019.

In summary, Gilbert and his auditing team commended the township for maintaining a positive fund balance and reducing its liability costs. He also said that the township will need to continue to monitor increasing expenditures and assess long-term legacy costs related to pensions.