401 Meeker St Delta CO 81416 970.874.4421

Town finances not in critical condition

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A critical view of Orchard City finances -- a view which has led to proposal of marijuana business and sales tax for the town -- is a view which may seem more alarming than is justified.

There was broad agreement at last week's town meeting that water rates need be raised. But trustee Craig Fuller also pointed out that the town's finances "are not a fire house emergency." He added, "The town is not going broke."

In addition, even with the results of his analysis raising eyebrows, trustee Dick Kirkpatrick pointed to the fact that the latest official audit reports of town finances have concluded that Orchard City is in excellent financial condition, especially compared with other towns.

Audited financial numbers can give a different picture than budget numbers used in the trustees' report.

For example, annual budgets propose spending that may or may not actually take place during the year. While Orchard City's 2014 budget projected an end-of-year water fund balance of $1.02 million, the audited cash balance at year's end was $1.38 million.

Budgeting is often done with a "conservative bias" meaning that future income is estimated at the low end of a range and costs are estimated at the high end of a range.

A clear pattern of events needs to be in place for some time to be considered a trend. In Orchard City's general fund, the end-of-year cash balance increased from $1.75 million in 2011 to a projected $2.27 million in 2015; an increase of $520,000.

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Surface Creek
finances, Orchard City
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