For Immediate Release December 20, 2010
COMMUNITY & GOVERNMENT RELATIONS
225 West Center Street v Kingsport, TN 37660 v 423-229-9413 v 423-229-9350 fax
Kingsport posts 11th straight year with clean audit of City finances
KINGSPORT -- Auditors issued a clean opinion on the City of Kingsport's finances for the 11th straight year, with no audit findings of weaknesses or deficiencies in the fiscal 2010 finances of the City. Kingsport even managed to add a bit to the undesignated general fund reserve despite a tough economy.
Auditors from the firm of Blackburn, Childers & Steagall provided these results late last week to the Board of Mayor and Aldermen's audit committee, headed up by Alderman Larry Munsey, Vice Mayor Ben Mallicote and Alderman Valerie Joh.
“This is truly an extraordinary report," Munsey said. "We continue to be engaged in a high number of projects, with $16 million in work nearly completed at MeadowView and work about to begin on the Aquatic Center, as well as a number of road and water/sewer projects. To once again receive a clean opinion should provide great confidence to the citizens of Kingsport that their tax dollars are truly well managed."
The audit committee will present the audit to the full Board of Mayor and Aldermen at today’s work session. According to the report, Kingsport's unreserved general fund balance stood at $13.15 million, up from $12.9 million in fiscal 2009 despite a tough economic climate.
"I think the credit truly rests with our line workers, managers and department heads who have tightened their belts and done their very best to hold costs down where ever possible," City Manager John Campbell said Thursday. "Our budget office has also done a great job, reminding staff that our revenues, while stabilized, only continue to grow slowly. And our Finance Department has also done a great job of managing the taxpayers' dollars and ensuring they are properly accounted for."
In addition to the growth in the general fund reserve, Kingsport posted another $12.8 million in unrestricted assets in the fleet and insurance internal funds.
"I think Kingsport as a whole has weathered the global financial storm about as well as anyone could have hoped for," Campbell said. "And Kingsport is well-positioned to come out of the recession stronger than anyone could have imagined."
Kingsport's tax rate remains at $1.94 per $100 of assessed property value, the third lowest rate in Kingsport history. And, Kingsport holds high-quality credit ratings from both Moody's, which rates Kingsport's debt as Aa2, and Standard & Poor's, which assigns Kingsport an AA- rating.
Items of concern in municipal audits are ranked in three ways; "material weaknesses" are of major import that jeopardizes the ability to present an accurate picture of city finances; "significant deficiencies" representing serious issues that should be resolved immediately before becoming a material weakness; and "other matters" which are not reported in the full audit.
This last category involves technical issues that should be addressed in the opinion of the auditors to avoid becoming significant issues in the future.
Kingsport posted three "other matters" involving the way internal fund loans are classified; centralization of grant oversight activities; and a lack of SAS-70 documentation on the school system's online payment processor for school nutrition.
Also, for the 10th straight year, the city's audit and financial report earned a Certificate of Achievement Award for Excellence in Financial Reporting from the Government Finance Officers Association for the FY 2009 Consolidated Annual Financial Report. The award recognizes governments that go beyond the minimum to provide concise and comprehensive annual financial reports.
