City of Presidio receives third consecutive positive audit

PRESIDIO — At Tuesday night’s City Council meeting, the City of Presidio received its third consecutive positive financial audit. Preston Singleton of the firm Singleton, Clark and Company — the city’s independent auditors — presented his findings to council. With a few minor tweaks, he was happy to issue the city a clean bill of financial health. 

An audit acts like a credit score for a government entity, affecting the city’s ability to successfully secure grants and loans. Presidio has had a checkered financial past: starting in 2013, audits started coming in chronically late, resulting in an adverse audit in 2019. Both the city’s former auditor, Doak Painter, and former city administrator, Joe Portillo, quit in the wake of the tumult. 

The city started turning things around in 2021, when Singleton returned with a positive — though late — audit. The city played catch-up over the next six months, and returned to a regular schedule in June of 2022. 

Tuesday night’s presentation marked a second year in a row that the city filed its audits on time. “It reflects highly upon the finance department and all the city’s administrative departments — kudos to them,” Singleton said. 

As the city approaches its next budget cycle, Singleton and the council members discussed strategies for staying on the right track. The latest audit — reflecting the 2021-2022 fiscal year — anticipated revenues of $1.8 million and expenditures of $3 million. 

The final numbers did not deviate too far from the expected deficit. Singleton explained that having a budget deficit in and of itself wasn’t catastrophic — or even all that rare. “You don’t always have to have a balanced budget, though some cities want that,” he explained. “It’s okay if in the end you’re spending more than you initially planned, but the important thing is to bring that matter to the council and let council approve increases to the budget.”

Presidio ultimately made up for the shortfall with a $1.3 million transfer from utilities funds. In Singleton’s words, the utilities funds act as “little businesses” — cities can make money from selling water, sewer and landfill services to customers. 

Following a years-long trend, the landfill was the biggest moneymaker for the city, bringing in around $771,000. From the audience, Presidian Ariel Lara worried about the long-term feasibility of the landfill as a cash cow. “It’s nearing the end of its life,” he said. “It’s a high priority to make sure we have a plan in place before we start having to export trash.” 

City officials also worried about the water fund. In 2022, the city raked in around $200,000 from its water utility — a fraction of what that figure could be. The city’s water loss rate hovered between 45% and 50% last year, thanks to leaks and broken or missing meters. “Water can make us money,” said Mayor Pro Tempore John Razo. “The water loss that we have is killing us.” 

Over the past few years, the city has made significant investments in water infrastructure and attempted to revise its water rates to keep costs low for ordinary citizens and collect more from heavy water users. The city’s public works department has also been diligently inspecting and installing water meters across town. “We’re already starting to see an increase [in funding] due to the new meters that were installed in December,” said City Administrator Pablo Rodriguez. 

Discussion of the city’s ongoing quest to straighten out its books ended on a positive note. “I’m very happy that we’re not where we used to be,” said Councilmember Nancy Arevalo. “Every year the city’s finances have been improving — gradually, but we’re getting there.”