Auditors gave Emporia a clean bill of overall financial health at a city commission study session Wednesday morning in the city conference room. Commissioners also heard reports on potential deterioration of the city’s infrastructure and a solution to a retirement-fund debt that has existed since 1977.
Neither of the latter affected the audit result.
“This year, it’s an unqualified opinion,” said Audrey M. Odermann, certified public accountant with Lowenthal Singleton Webb and Wilson of Lawrence, which conducted the audit. “It’s the very highest rating we can give. ... We did not note any material weaknesses in the internal controls as they relate to the financial statement.”
Odermann recommended that the commission put in writing policies that are being used but not defined in the city’s policy manual. Those included detailed procedures for dealing with grant records, debt management, and post-employment benefits like health benefits, among other suggestions.
“These are practices that are occurring — they’re doing these things — but it hasn’t necessarily been formalized,” Odermann said.
She also suggested that when projects are handled by various departments, communication is important between those departments and the accounting department. The monitoring expenses and progress could be formalized by the commission’s setting a capital assets policy.
Larry Bucklinger, director of administrative services, told commissioners that the city was about five years away from paying off the city’s matching contributions to the Kansas Police and Fire retirement fund.
“As we speak, we have an unfunded liability of something a little over $719,000,” Bucklinger said. “We’re paying interest on that by statute.”
The 35-year liability to KP&F has existed since 1977, and five years of payments remain at 8 percent interest.
Bucklinger said commissioners may want to consider borrowing money at a lower rate to pay off the debt now. Assistant City Manager Mark McAnarney estimated that the city could borrow money at 4.5 to 5 percent interest.
Bucklinger also told the commission that the city has lost approximately $6 million in value of the city’s infrastructure.
“We’re not investing in infrastructure at the same level as we’re using it up,” Bucklinger said. “I think that’s an important bit of information for the commission to consider when we’re looking at our capital improvement.”
He said that the philosophy in the past has been to maintain constant debt-service level.
“We’re pushing the debt out into the future and if that’s the way we want to continue to do it, we want to make a conscious decision,” he said. “If we think we’re burdening the future, we want to put that in the policy.”
During a discussion about cash carryover and the capital improvement plan fund, City Manager Mark Zimmerman suggested the commission might want to create an overall CIP fund, rather than have separate funds for each improvement project. As an example, he mentioned bridge projects on Graphic Arts Road and 30th Avenue as coming from separate CIP funds.
“We’re smarter, in my opinion, taking any leftover money and rolling it over into other projects rather than rolling them into bond and interest (fund) and having to bond the project,” Zimmerman said. “It’s kind of the model I’m trying to develop as part of the overall budget.”
Discussion turned to marketing as Jeanine McKenna presented information about work of the Emporia Area Chamber of Commerce and the Convention and Visitors Bureau. McKenna is president and chief executive officer of the Chamber and appeared in support of a request for $328,000 from the city budget. The amount is the same as approved for 2007; $305,500 has been paid out so far.
The marketing effort of Emporia and the Flint Hills is exploding in a most positive way, McKenna said.
Plans had been to add kiosks with local brochures at the new Kansas Turnpike interchange when it is completed in 2008. The state Department of Commerce wants to turn the plan into a visitors’ center with restrooms and multiple displays to promote Emporia and Kansas. The center may be funded through grants. McKenna said the Chamber and CVB would have options to feature local brochures and promotional materials that correspond with events happening in the area.
The CVB will introduce a new marketing campaign in 2008, and has created a new visitors’ guide that includes not only traditional information on the city, but shopping spots that would interest travelers, including the “wall of denim” at Bluestem Farm and Ranch and the bridal, dress, and gift items at Madelynn’s.
“There’s a lot of focus to take a look at how to pull people off the interstate,” she said.
Distribution of brochures has been or soon will be expanded throughout Kansas, in the Kansas City metro area and Missouri visitation points, she said. The Web site will be completely revamped by the end of the year, and promotion also is being done on myspace.com.
The Chamber is partnering with Main Street, and together they are changing marketing tactics to draw retail trade to this area. Long-term advertising is planned in Chase, Coffey and Osage counties and in Council Grove.
Representatives of the Leadership Emporia Class of 2004 presented a synopsis of its playground project for Peter Pan Park, and to ask the city to build in $37,500 in support from the 2008 budget.
“We really have not spent much money on our parks in recent years,” said Mayor Julia Johnson. “... This is something I would like to see us participate in.”
Zimmerman said that commissioners could pledge some of the monies from the Lake Kahola fund, which could be a guaranteed source of revenue. Otherwise, the park proposal would compete against needs of other community projects.
Eric Tincher, president of Leadership Emporia 2004, said that the class has created a 501(c)(3) through the Emporia Area Chamber of Commerce and has collected about $46,000 in cash and pledges. The class continues to look for grants and will be collecting money at a variety of public events throughout the summer.