Opinion: IVGID a very financially stable government entity | SierraSun.com

Opinion: IVGID a very financially stable government entity

Joe Wolfe
Special to the Bonanza

This newspaper recently printed a guest column from Aaron Katz critiquing the IVGID General Manager’s column, which summarized our annual audit report.

It appears Mr. Katz, who to the best of my knowledge has no credentials in financial accounting, makes the following claims:

1) Our auditor didn’t really perform an audit.

2) We shouldn’t spend any funds on maintenance and future capital needs.

“ The bottom line is that we’ve managed to keep our annual increases in expenses below the rate of inflation and managed to stabilize our revenues during recessionary times .”

First of all, as a public agency, we are required to hire an outside auditor on annual basis to ensure that we are meeting all of the requirements of the Governmental Accounting Standards Board.

In order to satisfy the requirements of GASB, we are required to have the outside auditor conduct a very comprehensive review of all of our finances. The auditor does verify that the proper design and execution of our transactions.

Internal controls and protocols are tested. Financial amounts are tested along with how they are presented. We’ve met every standard that both the regulatory agencies and any potential bondholder would require of us.

The unmodified opinion we received from the auditor is the highest rating we could possibly receive. I would think if we’ve met the requirements of someone who would be willing to lend us millions of dollars, it should be good enough for Mr. Katz as well.

Mr. Katz goes on to critique some of our previous expenditures such as those for snow groomers and lawnmowers. These purchases all went through plenty of scrutiny, and we purchased the items that would provide the best level of service for the district for the longest period of time.

I am confident that the taxpayers of this district received top value for these purchases. I’m guessing if we purchased the cheapest equipment with the shortest useful life, he would have criticized that as well.

Mr. Katz goes on to do a lot of paraphrasing regarding our expenses and revenues and reserve funds — taking liberties with what was written in the column.

The bottom line is that we’ve managed to keep our annual increases in expenses below the rate of inflation and managed to stabilize our revenues during recessionary times.

He also goes on to claim that our recreation fee has increased during the time period — which it did only during the first year of the five years of the reporting period. I am proud to leave office in an environment where the recreation fee has remained flat for my entire term of office.

In addition, he finds it wrong that we’ve set aside money in our reserves for contingencies and future capital needs. Mr. Katz doesn’t seem to understand that we have an obligation to the public to ensure that we have funds available for emergencies such as fire or storm damage, and that prudent financial management requires that we plan for the future replacement of our existing facilities.

In fact, Mr. Katz’s current fees would likely be lower if previous boards had conducted more prudent financial management. Apparently, Mr. Katz would prefer that we pass on a disproportionate amount of the cost to the next generation of homeowners.

Finally, he complains that our improved financial condition is a result of higher fees and lower outstanding balances on our bonds. As I noted above, we’ve kept our recreation fee flat for the past five years, we’ve modestly increased our water and sewer rates so that we can save enough money for future capital needs, and we’ve significantly paid down our bonded indebtedness.

I don’t feel like we have anything to apologize for. In fact, I would challenge Mr. Katz to find a more financially stable government entity.

Joe Wolfe is chairman of the Incline Village General Improvement District Board of Trustees, and an outgoing trustee. His term ends this month. He may be reached for comment at joe_trustee@ivgid.org.