By Tim Douglass, tdouglass@pctribune.com

Glenwood City Commissioners received a favorable audit report from the city’s 2021 financial audit conducted by Abdo Solutions.

The audit revealed that the general fund budget compared to actual showed that revenues came in about $132,277 over budget and that expenditures were about $696,543 under budget, giving the city about $823,820 excess in revenue over expenditures.

Property taxes account for most of the city’s revenue in the general fund, along with licenses and permits, charges for services and intergovernmental revenue such as Local Government Aid (LGA).  

The city’s debt service annual costs held steady at around $200,000 for the year, the same as the past three years.   The debt includes an outstanding bond for $1,345,000 for the 2018 Street Improvement project and a $883,718 bond for the Fire Hall.  

The city’s water fund and sewer fund showed that rates were high enough to cover expenses and provide a cushion for future capital expenditures.  Operating funds are running about 50% more than the cost to operate in both funds, it was stated by Schmidt, providing room for improvement expenditures as needed. 

The city’s liquor store, the Grog Shop, had another good year in 2021 with income before transfers coming in at about 12.8% and a gross profit of about 25.6%.  The average income before transfers for other municipal liquor stores in the state is at 9.2%, with gross profits of 9.6%.

City Administrator Dave Iverson reminded commissioners that the local liquor store functions more on beer sales, without the high-dollar spirit or wine sales that many other liquor stores have.  “That shows just how good of a job our manager, (Bob Benson) is doing at our store.”

As far as taxes rates go, Glenwood is below all other cities in Pope County, at a 68.2% tax rate for 2021.  Minnesota cities up to 2,500 had an average tax rate of 58.8% in 2020; and cities up to 10,000 population have a average tax rate of 101.8 percent.  Figures for 2021 for those cities was not available.

Glenwood’s debt, however, is well below the average of other cities its size in the state, including the debt service expenditures as a percent of total expenditures.  Glenwood in 2020 is at 6.87% in debt expenditures as a percent of total expenditures.  In cities with populations of 2,500 to 10,000, the average debt expenditure is 13.39% of total expenditures.    

Abby Schmidt, a senior Associate of Abdo, gave the audit presentation via zoom and told commissioners that the audit does recommend getting a written agreement for advances to the Glenwood Development Corporation (GDC) and the Glenwood Development Foundation.  The change is needed to better protect the city’s financial position, stated Schmidt.  Iverson said the city has already taken steps with the city’s legal counsel to provide the written agreement between the city and the GDC.    The auditors always recommend better segregation of financial duties in Glenwood as well as other smaller cities, but acknowledges that because of size, it is difficult to justify expense of more employees just to separate duties to meet financial audit recommendations.  

Schmidt also pointed out that it was a pleasure doing the audit and commended the city’s Financial Officer Brenda Sargent for her detailed work allowing an easy audit report.  Iverson also commended Sargent for her work and the city’s department heads for doing a “fantastic job with their budgets and expenditures.”  

In other business, the city commission:

•Approved a memorandum of understanding with Lakeside Prairie Farm to allow 20 goats to graze on buckthorn in Barsness Park during the summer season.  There were 30 goats from the same farm that grazed the park last fall.  This year there will be 10 fewer goats, but they will be in the park during the entire growing season, it was stated.  The cost for the goats is paid for by donations from locals to the buckthorn management efforts.  Goats love to eat the leaves of the invasive buckthorn plant and defoliates many young plants ,which halts them from growing over time.    The goats graze on buckthorn in areas that cannot be reached by workers or machines.

•Unanimously approved appointing John R. Stone to the Glenwood Park Board.  

•Approved a resolution that would allow the receipt of $285,335.92 in additional funds under the American Rescue Plan Act.