Audit: San Luis service finances improving

SAN LUIS, Ariz. — Efforts here to make municipal trash collection and water and sewer services more financially self-sufficient are starting to pay off, according to a half-year audit of city finances.

Past years have seen San Luis City Hall have to dip into the general fund to help cover the cost of the utilities and trash collection. And while it may do so again in the current 2012-13 fiscal year, it will not have as large a deficit to close, according to the audit by the Lumbard & Associates certified public accounting firm.

In 2010, the city council began increasing water, sewer and trash collection rates it charged residents, in efforts to make those services pay for themselves.

The action proved controversial among residents and even prompted recall efforts against the then-mayor and several council members. Yet, it has managed to reduce the shortfall in the city's Enterprise Fund, the account from which city pays for the services, according to the audit.

The deficit has fallen from $1.5 million two years ago to just under $400,000 halfway through the current fiscal year that ends June 30.

“These are the fruits of the adjustments that we have made in the last two years,” Mayor Gerardo Sanchez said. “Before, a very dark picture of the city was presented, but now the numbers are starting toward the positive side.”

He said city officials will meet in the coming weeks to see what other steps can be taken to eliminate the shortfall by fiscal year's end.

While mainly positive, the audit prepared by accountant Lisa Lumbard found fault with the city for insufficient backup of financial information on city computers, for incomplete record-keeping for city assets and for failure to follow established procedures for paying providers of services to the city.

Sanchez said the last of those three criticisms reflected the city's loss of $45,000 wired to what was thought to be a booking agency for a Mexican rock band the city wanted to hire for its Barriers to Bridge cultural festival last February. The booking agency ended up being scammers in Mexico.

The scam remains under investigation by San Luis police, but the city has not been able to recover the money.

The city was making substantial investments to back up the computerized financial information even before the audit was done, Sanchez said, adding that City Hall will address all other shortcomings that Lumbard identified.