The April 27 budget workshop reviewed the city’s February 2026 financials. Tax revenue was slightly below last year for February, but stronger March and April collections pushed overall revenue up about 5.2% year-over-year. Sales tax revenue totaled about $311,841, distributed among the general fund, streets, parks, and bond payments. Revenue and expenses were generally on track with the budget, and the city reported bank balances of $5.3 million at the end of February.
Capital purchases included a Ford F-150 for streets purchased from Parks, and a skid steer for snow and maintenance work. Long-term liabilities included remaining bond payments and a $100,000 loan from the Natural Resources Division. Several CDs renewed at slightly lower interest rates.
Discussion focused heavily on audit and oversight issues. Alderman David Avanzino asked about concerning language he saw within the 2024 audit; “management override of controls” were explained as staffing-related audit observations rather than fraud concerns. In some cases, auditors will give way for supplemental and reporting issues for small towns with small staff.
It was clarified that Parks, the CAPC, Cemetery, and the Hospital commissions are audited separately from the city. Questions were raised about whether council has enough visibility into potential commission liabilities.
City Finance Director Michael Akins and council discussed improving oversight through requiring more comprehensive quarterly commission reports, and the possibility of requiring commissions to operate under balanced budgets. Questions were also raised about transfers to water and wastewater operations. Akins explained these are being tracked internally but not treated as formal liabilities.
During the council meeting that followed, discussion of the legislative audit continued. Akins expounded on the difference between generally accepted accounting procedures and Arkansas State regulatory accounting. Akins emphasized the city is not doing anything incorrectly, but rather following state regulatory law, which excludes certain enterprise funds such as water, sewer, and the hospital from the main city audit as they are reviewed separately. As a result, the audit reflects only the portions of city government under state reporting structure.
The audit identified one material weakness (delayed completion of required audits), along with two reportable findings: delayed bank reconciliations and an issue involving the Cemetery Commission. Akins explained that all issues are being addressed, bringing overdue audits current and improving reconciliation timelines. The Cemetery Commission finding will be followed up with administratively.
Akins also explained audit “finding levels,” noting that material weaknesses are the most serious, followed by reportable findings, and then lower-level suggestions (“supplemental”). In this case, only one serious issue was identified related to audit delays accumulated before Akins’ time as finance director.
Council discussion included staffing limitations, and whether additional financial policies – such as formal fund balance or reserve requirements – should be adopted. Akins responded that while reserves and planning principles are already informally used (such as in the franchise fee fund), formal policies could reduce flexibility for future projects (committing money for long periods where it could be used/generating funds elsewhere).
Council voted during the regular meeting to approve the 2024 legislative audit following Akins’ explanation.