Town caught up with state audit reports, HURF revenue deficit down by one-third since 2016
Superior Town Government has emerged from years of financial difficulties to receive a clean bill of financial health from its auditors at the Feb. 8 Town Council meeting.
McKay Hall, representing the Hinton Burdick auditing firm, gave Superior a “clean, unqualified audit” for the 2017 fiscal year; the town’s first since 2011. The firm found no material weaknesses and so significant deficiencies in Superior’s finances, and predicted that the town’s financial health should continue to improve under current policies.
Superior’s financial improvement was reflected in the audit of its General Fund. Assets at the end of fiscal 2017 were $175,812, the highest in the previous five years and well above the low point of $122,985 in fiscal 2015. Liabilities were $1,368,827, the lowest in five years and only about one-third the $3,606,803 in fiscal 2015.
The Hinton Burdick report also noted the widest gap between Superior’s revenues and expenses in the past five years. Revenues were $2,233,213 while expenses were $1,944,823. Expenses exceeded revenues as late as fiscal 2014.
The turnaround in Superior’s financial health resulted from much work by Superior officials and staffers.
“In the last few years the town has implemented a number of financial controls and procedures, and these improved controls have begun to be reflected in our audits,” said Superior Town Manager Todd Pryor.
This included getting caught up with audits required by the state of Arizona, which at one point Superior was several years behind. Superior got caught up with the audits with fiscal 2017 and is currently ahead of schedule with the fiscal 2018 audit, Pryor noted.
“We have been working diligently to improve the town’s financial position, and we have been able to pay down our HURF (Highway User Revenue Fund) and Excise debt by over $600,000 as of this audit. We have spent an additional $300,000 plus this year toward this debt.,” Pryor added.
Superior was cited in 2015 by the Arizona Department of Revenue (ADR) for not using its HURF funds for their targeted purpose of road building and maintenance. Losing revenue sources during the Great Recession of 2009-13, Superior shifted HURF monies to its General Fund for other town expenses.
In 2016 Superior negotiated a repayment plan with ADR where it would add from its General Fund additional monies to HURF grants for road work until the original $2.8 million deficit was paid off. By fast-tracking needed road rebuilding work in town, Superior had reduced the HURF deficit to $2.2 million by July 2017 and (with the Sunset/Panther Road resurfacing project) currently to $1.88 million, Pryor noted. With the upcoming Main Street/Magma Road project, Superior should shave the HURF deficit further.
“We also have been able to pay off the MPC (Municipal Property Corporation) bond completely by doubling up on the payments last year. All-in-all, the Town has decreased its long-term debt by almost $1.3 million in the last three years,” Pryor said.
Superior also has spent almost $250,000 toward the Transfer Station cleanup project, and this project is more half complete. The project involves cleaning up piles of asbestos-contaminated construction materials left by Orion Recycling when it operated the Transfer Station, and getting rid of up to 6,500 yards of green waste (including wood). To facilitate the latter, Superior acquired a $96,000 air curtain burner to reduce the green waste to 3% of its original volume.
“Superior will work to continually improve its processes to make sure our local government it transparent and trustworthy. To that end, full unaudited financial reports are being uploaded to the town website (www.superioraz.gov) on a monthly basis. We encourage our citizens to review these statements and are happy to answer any questions they may have,” Pryor explained.