Heavy equipment stands ready to begin a city of Fallon reconstruction project on East Court Street.
Sara Dowling | NNG
The Fallon City Council on Feb. 20 approved capital project funding and a plan to correct and prevent budget errors.
The city’s road reconstruction project on East Court Street that was approved in September is underway and will continue through the spring. The Court Street Rehabilitation project plan includes repaving portions of Court Street from South East Street to South Nevada Street.
City Clerk/Treasurer Sean Richardson notified the council that the city's request for a medium-term obligation had been approved by the Nevada Department of Taxation. The approval allows the city to borrow a bond for up to $10 million to finance various capital improvement projects. The bond is repayable over 10 years from the revenue of the city's general fund and water, sewer and airport enterprise funds. The financing must be secured within 18 months of the approval letter, dated Jan. 11.
The council then approved follow-up resolution 24-03 to reimburse the city from the bond funds for project costs incurred prior to its approval.
The council also approved a plan of correction to prevent the recurrence of statute and regulation violations as reported in an Annual Comprehensive Financial Report note for the year ended June 30.
During fiscal year 2023, the city had expenses in excess of the budgeted appropriations for the Convention Tourism Authority fund, Water Treatment Enterprise fund and Public Works Internal Service fund.
Although the Fallon Convention Tourism Authority fund net expenditures and other financing sources was slightly less than the budget, the expenditures fund exceeded the budget when compared on its own. The plan states that city staff will conduct a budget analysis of each fund individually to prevent a recurrence of the violation.
Both the Water Treatment Enterprise fund and Public Works Internal Service fund were over expended due to a significant increase in the other postemployment benefits liability. OPEB liability can vary significantly due to estimating factors including inflation, salary increases, discount rates, health insurance trends and investment returns. Going forward, city staff will consider the “greater than anticipated” approach with their estimates.
The plan of correction has been forwarded to the Nevada Department of Taxation for approval.