Sterling Heights reviews finances, celebrates clean audit

STERLING HEIGHTS — Reminiscing is common around this time of year, and on Dec. 6, the City Council took an opportunity to review the city’s annual comprehensive financial report for the 2021-22 fiscal year, as well as its financial audit.

Assistant Finance and Budget Director Nick Makie revealed during his presentation that the total net position of the city was $191.5 million for that fiscal year, which ended June 30.

“The bottom line is that the audit results show the city’s budgeting and long-term financial planning is on target,” he said. “We are continuing to add to general fund reserves, ensuring adequate resources will be available to weather any current and future economic uncertainty.”

The city’s general fund revenue was $115.2 million, compared to $114.6 million in spending, resulting in around $600,000 of additional general fund reserves, bringing those reserves to $32.9 million, or 28.7% of annual general fund spending.

“In 2023, we are projected to have a contribution to fund balance of $300,000, bringing our total reserves to $33.2 million, which is 28.3% of expenditures,” Makie explained.

For the general fund, revenue came in 98.2% of budgeted expectations and was $800,000 less than the prior year. Makie explained that the lower revenue was partly caused by getting $3.6 million less in federal and state funding, which Makie tied to the end of some temporary COVID-19 relief.

The general fund’s spending was 98.3% of budgeted expectations and was $900,000 higher than the prior year, Makie said. He cited $700,000 more in pension and other postemployment benefit contributions — as well as $2.2 million more in staff costs such as wage adjustments — as contributing reasons.

“Every city department came in on or under budget,” he added.

Auditing firm Plante & Moran gave the city the best possible audit rating of “unmodified” for the city’s financial reporting of the 2021-22 fiscal year. During the meeting, David Helisek, a partner at Plante & Moran, commented on the city’s financial conduct.

“When you take a step back and you look at the financial health of the city and really how you’re operating and the results for the audit, I mean, if this were school, we’d give you an A,” he said. “If it was baseball, you’d be pitching a perfect game.”

City officials added that Sterling Heights once again earned the Government Finance Officers Association’s award for excellence in financial reporting.

Mayor Pro Tem Liz Sierawski gave kudos to the city’s financial team, adding that having unmodified opinions and no findings is “a very remarkable feat.” Mayor Michael Taylor said the city continues to expect very high performance levels.

“It’s reassuring to know that we are in good hands with our finance team, our administration, and that we’re keeping track of everything that’s coming in so that our taxpayers know that we’re being good stewards of their money,” Taylor said.

Read Plante & Moran’s audit by visiting sterling-heights.net.