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Harlingen is riding a record cash stockpile built on solid financial practices, leading auditors to issue a clean opinion, the city’s annual financial audit shows.
During the fiscal year running from 2022 to 2023, the city’s fund balance climbed to $35.6 million, an increase of $4.7 million over the previous year, bolstering a cache that would allow the city to operate 220 days in case of emergency, the certified public accounting firm of Cascos and Associates reported in the city’s annual comprehensive report.
“It was a very good outlook for the future,” Robert Rodriguez, the city’s finance director, said in an interview. “It’s a healthy fund balance. We do conservative spending. Sometimes it comes from surpluses during the year. The city manager accumulates funds for capital outlay projects. We spend it on one-time expenditures. You never want to commit fund balance for recurring expenses.”
During a May 1 presentation, auditor Alfred Vera described the city as operating “in great shape financially.”
“It’s a clean opinion,” auditor Carlos Cascos told city commissioners. “An unmodified opinion is the most favorable opinion that any CPA firm can give an entity. We found no issues that needed to be reported.”
In response, Mayor Norma Sepulveda said officials are focusing on saving money.
“It’s exciting news for the commission and the community to know that we are in such good shape,” she said. “This commission has been really focused on saving money and doing more with less money.”
During the fiscal year, the city’s total net investment in capital assets climbed to $153.7 million, up from $132.8 million the previous year.
The audit showed the city’s net position stood at $105.5 million, up from $91.5 million.
Meanwhile, total direct debt was at $31 million.
Harlingen’s financial condition led Fitch Ratings to issue an AA+ rating on the city’s general obligation debt and certificates of obligation debt “on their view of the city’s historically strong financial position coupled with strong reserve levels,” the auditors wrote.
In the city’s general fund, revenues totaled $64 million, covering $58 million in expenditures.
While the property tax revenue climbed to $24.3 million, up from $23.5 million, sales tax revenue jumped to $30.2 million from $28.9 million.
In the auditors’ review of the city’s Economic Development Corporation’s budget, the agency’s fund balance climbed to $16.6 million from $14.3 million the previous year.
During the fiscal year, the Harlingen Community Improvement Board’s total fund balance grew to $8.5 million, up from $7.8 million.
While the WaterWorks System’s operating revenue increased to $22.4 million from $21.7 million, the department’s total operating expenses dropped to $20.9 million from $21.7 million, with its total net position increasing to $97.6 million from $89.1 million.
At Valley International Airport, operating revenue climbed to $8 million, up from $6.7 million, while operating expenses grew to $8.5 million, up from $8 million the previous year. Meanwhile, the airport’s net position increased to $105.5 million, up from $91.5 million.
While the sanitation fund’s operating revenues climbed to $10.6 million from $10.4 million, the department’s operating expenses grew to $12.5 million from $9.9 million the previous year.
At the Tony Butler Gold Course, operating revenue increased to $940,954 from $854,184, while expenses climbed to $1.3 million from $1.1 million the previous year.
Since the coronavirus pandemic broke out in March 2020, the Harlingen Municipal Auditorium has struggled.
During the last fiscal year, operating revenues increased to $153,901 from $104,467 while operating expenses dropped to $311,039 from $317,806 the previous year.
At the Harlingen Arts and Heritage Museum, operating revenues jumped to $17,642 from $621 the previous year, while operating revenues increased to $120,144 from $115,445 the previous year.
