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Auditors Give East Hampton Town Finances High Marks

Thu, 08/15/2024 - 12:56
East Hampton Town Hall
Durell Godfrey

East Hampton Town’s finance division presented the town board with a comprehensive report last week detailing the town’s financial activity for the year ending Dec. 31, 2023. An independent audit by Nawrocki Smith L.L.P. was included in the report, and Craig Hauser, a senior manager with the firm, told board members that “no material weaknesses in internal control were identified.” Nawrocki Smith was in and out of town offices over the course of four to five weeks this spring, he said, and had no recommendations to make on improving accounting procedures.

In other words, all good, man. “We’re very pleased with the 2023 results,” Rebecca Hansen, the town administrator and budget officer, said.

Later in the presentation, however, Ms. Hansen, noting that town employees’ salaries and benefits account for 60 percent of the operating budget, commented that while revenues are stable, they are not increasing at the same rate as expenses. This, she said, is the “stark reality” that the town will soon need to face. “Addressing the tax cap may be something that is worth considering,” she said.

Health insurance costs are on the rise, causing the town to seek less expensive options. Councilman Tom Flight asked how much each plan costs the town. “Roughly $40,000 a year,” Ms. Hansen answered.

During the public comment portion of the meeting, David Buda of Springs, who often comments on town board doings, called in to question the net increase — by $20.7 million, to $137.7 million — of post-employment benefits owed by the town. “Frankly, the cost to the town is staggering,” he said.

Mr. Hauser agreed that the number was “astronomical,” but maintained that it is a skewed number, one that shows up across municipalities nationwide. “It’s not a number I would focus on,” he said. “I don’t see having to pay this obligation. There is only a small portion of it that is paid out through the year.”

The town had a balance of $179.1 million in its government funds at the end of 2023, an 18.8 percent increase from the prior year, and paid out $14.6 million in debt service. It brought in revenues of $150.4 million ($63.9 million of it from property taxes. Grants accounted for another big number, bringing in just under $50 million. Expenditures were $145.3 million, down 12 percent “less repairs and maintenance” — less equipment being purchased and fewer land purchases, according to Mr. Hauser — and revenues were up 5.2 percent (“a result of greater than expected state aid,” he said).

The community preservation fund added $16,436,043, to top off at $91.2 million at the end of 2023. The town spent $28.7 million from it over the course of the year.

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