STATE OF NEVADA, )



STATE OF NEVADA, )

COUNTY OF ELKO. ) ss. MARCH 10, 2005

The Board of Elko County Commissioners met in a special session on March 2, 2005 at 4:00 p.m., in Room 105 of the Elko County Courthouse at 571 Idaho Street, Elko, Nevada.

There were present: County Commissioners Sheri Eklund-Brown, V-Chair

Mike Nannini

Warren Russell

ABSENT Charlie Myers

ABSENT John Ellison

District Attorney Kristin McQueary

Deputy County Clerk Marilyn Tipton

Executive Secretary Michele Petty

Deputy Comptroller Debbie Armuth

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The proceedings were as follows:

CALL TO ORDER:

Vice-Chairwoman Eklund-Brown called the meeting to order at 4:00 p.m. She noted for the record that both Commissioner Myers and Commissioner Ellison were absent due to other County business.

COMMENTS BY THE GENERAL PUBLIC:

There were no public comments submitted.

ANNUAL AUDIT FOR FISCAL YEAR ENDING JUNE 30, 2004:

Pursuant to NRS 354.624, the Board received an annual independent audit from Kafoury, Armstrong & Company.

Teri Gage noted that the all the Commissioners had a copy of the audit in front of them. She reviewed page 1 – the Auditor’s opinion. She stated that the County had a clean opinion and the County had complied in all material respects to County standards. She stated that they also had a clean opinion in the grant arena and that was located at the back of the statement. She stated they would give a more detailed presentation with charts to the entire Commission at a later date.

Teri Gage stated that right after the opinion was the Management, Discussion and Analysis paper. She noted this was the second year that they had implemented GASB 34 wherein they were converting their statements from modified to full accrue accounting which put them more on line with what a normal business or for profit business books would look like. Teri Gage stated that the Management, Discussion and Analysis letter was written by Cash Minor the County’s Comptroller. She noted that because this was the second year of GASB 34 there was comparable information between 2003 and 2004.

Commissioner Russell inquired if the State of Nevada was required to operate under GASB 34. Teri Gage replied yes, all local governments were required to operate under GASB 34. She noted that GASB 34 was located on pages 2-13, and she recommended that they review those pages.

Teri Gage stated on pages 14 and 15 were the full accrue statements, statement of net assets. She stated there was a statement of their activities. She noted that they would see a Government Activities column and a Business-Type Activities Column and a Total Primary Government column. She explained that the Government Activities column was the general funds, all their special revenue, debt service and capital projects. She stated their Business-Type Activities were the enterprise funds, the water, garbage, landfill, ambulance and cost allocations would be included in that column. She noted that this year based on their 2003-04 budget the general fund received money back through the cost allocation so that was also recorded in this statement. Teri Gage stated that they also recorded the Component Unit which was the Agricultural District No 4.

Teri Gage reported that the County’s total net assets had increased this year 7% from the prior year which was 4.8 million dollars. She stated that the biggest part of the increase was the capital assets in Jarbidge, Jackpot, Montello, and the Jackpot transfer station. She noted that most of those projects were State funded through AB 198 or other grant funding.

Teri Gage reviewed page 15 which displayed the expenses for each function, adds in the charges for services, the revenue associated with that function and the deficit. She noted that this statement showed where the tax dollars were going.

Commissioner Russell commented that there was an increase in the ending fund balance.

Teri Gage stated that there was a decrease in their investment earnings. She stated the main reason for that was because the auditors were required to convert investment earnings to fair market value. She stated that with that conversion and the decline in the market, they had a $400,000.00 loss. Teri Gage stated that when the County turned those investments over then they would get the full price of those investments but the auditors were obligated to record the fair market value. Commissioner Eklund-Brown commented upon the drop in the market. Commissioner Nannini clarified that Caesar Salicchi invested the County’s money but nobody was making money on the market right now. There was a discussion regarding the market rebounding. Commissioner Nannini commended Caesar on the excellent job he was doing. Teri Gage noted that the interest rates had dropped about a percentage point.

Teri Gage stated that on page 35 was the statute violations which the auditors were required to read into the record. She noted that there were ten funds which had over expenditures. She stated that those expenditures were very small and commended the staff for all the hard work they do monitoring the budget. Teri Gage stated that these over expenditures were very insignificant for budget variances. Commissioner Nannini stated that they try to control these. Teri Gage noted that the majority of those violations were related to their enterprise funds. She believed that was because all the depreciation on the new capital projects was not budgeted for on the amount of money that they had appropriated.

Teri Gage stated on page 50 was the general fund. She stated on page 57 their General Fund ending fund balance was 3.6 million dollars but they only budgeted about one million dollars. She commented that the consolidated sales tax revenue came in higher, other revenues came in higher and the expenses came in lower than budgeted. She stated that the County ended much better than they had anticipated so that would help with this year’s budget process.

Commissioner Nannini noted that the County staff was very conservative and they always budget on the conservative side.

Debbie Armuth stated that the estimates that they had included within their budget when the budget was drafted for the 2004-05 year were a little different than the actual budget that was presented to the State. She explained that they had to accommodate for the changes to the budget.

Teri Gage noted that over the last few years the County has had a substantial increase in grant awards and expenditures. She stated on page 169 it showed 2.3 million dollars was received in federal grant awards. Teri Gage stated that last year they had 2.2 million dollars in grant awards. She stated this amount did not include the monies that were received under the State grant funding for the Jarbidge and Montello water systems. Commissioner Nannini commented that would be about another two million in those projects. Teri Gage believed it was at two million and they would have more come in 2004-05. Commissioner Eklund-Brown commented that it did not include PILT. Teri Gage noted that the grant funding took a huge amount of their administration’s time, and commended Debbie Armuth on the amount of time she spent monitoring these grant funds.

Teri Gage stated in Homeland Security grants they received $374,000 which added equipment to their public safety functions. Commissioner Russell stated that they should give credit to LEPC for obtaining those grants. Commissioner Nannini inquired if the pass through from Wendover Fire Department was included in that amount. Teri Gage stated it was included in the $374,544.00. Commissioner Nannini stated that Jeff Knudtson did a great job and shared the equipment with everyone. Teri Gage clarified that those funds were related to the DOE grants.

Teri Gage stated that there would be two letters at the back of their report. She stated that the Audit Communication Requirement letter informed the Board on certain items with relation to the audit. She stated that they were required to inform the Board of any illegal acts, inform them of any major changes in their accounting policies, and any account estimates or major changes in those. She stated that the last letter was the Management Letter. Teri Gage stated that they continue to have bank accounts set up by individual Department Heads. She stated that when they start the audit process they send out a confirmation notice to the local banks using the County’s EIN number. Teri Gage stated that there were still quite a few bank accounts being listed which the Department Heads had set up. She hoped that the County was aware of those accounts, or that the accounting department and administration knew of those accounts. Therefore, they could bring them into the administration ledger accounting system and make sure that there was proper reconciliation on those accounts. Teri Gage stated that they wanted to make sure that there were proper controls in place and those funds were properly accounted for. Commissioner Eklund-Brown inquired if that had happened. Teri Gage stated that there were some accounts which they had brought into the system. She stated that the County did a better job this year but she felt it would be a continual process to get those accounts accounted for. Teri Gage felt that the Department Heads should make sure that there were proper controls in place on those accounts.

Teri Gage thanked the staff and noted that a lot of time and effort went into this report. She stated that they had the help of Caesar’s Office, Debbie Armuth and Cash Minor to put this report together and thanked them for the continued service.

MOTION: Commissioner Nannini moved for approval of the annual audit for the year ending in June 30, 2004. Commissioner Russell seconded the motion. The motion was passed unanimously.

ADJOURNMENT:

There being no further business to come before the Board, Vice Chairman Eklund-Brown adjourned the meeting at 4:16 p.m.

APPROVED,

SHERI EKLUND-BROWN, Vice-Chair

ATTEST:

MARILYN TIPTON, Deputy Clerk

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