Herald Journal - Enterprise Dispatch - Delano Herald Journal
Waverly’s finances are improving, except sewer
March 15, 2010

By Starrla Cray
Staff Writer

WAVERLY, MN – If Waverly’s audit for 2009 were a school report card, most of the grades would probably be “A”s and “B”s in terms of effort and progress.

The sewer fund’s deep deficit, however, might be marked “needs improvement.”

Matt Mayer of KDV financial services presented the audit report at the Waverly City Council meeting Tuesday.

“A lot of tough decisions are starting to pay off,” Mayer told the council. “You made about $600,000 worth of progress over the course of four years.”

The general fund cash balance was at negative $730,776 at the end of 2005. At the end of 2009, it was at negative $132,658.

“It’s still a deficit, but you’re definitely moving in the right direction,” Mayer said.

If the city stays on its current path, the general fund should be back in the black by late 2010 or early 2011, he added.

Revenues and expenditures were both down in 2009.

On the revenue side, Waverly expected to receive about $820,000 in property taxes, but the actual amount was roughly $717,000.

“Delinquent taxes went up significantly,” Mayer said. “It’s a reflection of the economy.”

Licences and permits also came in lower than expected, at around $31,000 under budget.

“To add insult to injury, the state cut back on aid,” Mayer said. Waverly had budgeted for $62,248 in local government aid, but only received $39,632. However, the city did receive $33,465 in market value credit.

For expenditures, Waverly was expecting $314,273 in 2009, but instead spent a total of $280,609.

Water and sewer funds
In the water fund, increased user fees are starting to help stabilize the fund, but the city should still continue to review the fund’s operations, Mayer said.

At the end of 2009, the water fund had a negative cash balance of $84,212, which is an improvement from 2008, when the balance was at negative $365,181. The fund should soon be self-sufficient, Mayer said.

“The sewer fund is a little bit of a different story, however,” Mayer continued.

For four of the past five years, receipts have not been sufficient to cover operating and debt service costs. At the end of 2009, the sewer fund had a negative cash balance of $226,079.

Connection fees were down more than $15,000 in the past year, due to the lack of new home construction.

According to Mayer, the sewer fund deficit is a “red flag” that needs to be corrected.

“That is something you’re going to have to address going forward,” he said.

Liquor store audit
At the end of 2009, the liquor store had an operating income of $27,536. Loans that the store owes brings this amount down to about $16,000, however.

The store has typically been at about a break-even point, but when most of its debt is gone in 2014, there is expected to be more positive cash flow.


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