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1998-12-31 (2) .. .. RECEIVED ilia MAR 1 5 2000 .. ELAINE SNOWDEN TOWN CLE'RK ilia .. .. TOWN OF WAPPINGER, NEW YORK FINANCIAL STATEMENTS ilia AS OF AND FOR 1BE YEAR ENDED DECEMBER 31, 1998 .. .. .. ... ... .. .. .. .. .. .. .. .. TOWN OF WAPPINGER, NEW YORK TABLE OF CONTENTS DECEMBER 31, 1998 .. .. DESCRIPrlON PAGE(~ .. Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1 .. Independent Auditors' Report on Compliance and on Internal Control Over Financial Reponing Based on an Audit of GeIIoral Purpose FiDlllCial Statements Performed in Accordance With GoVerDlDent Auditiq Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-3 .. ... GENERAL PURPOSE FINANCIAL STATEMENTS: ... Combined Balance Sheet - All Fund Types and Account Groups . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " . . . . . . . . . . . . . . . . . . . . 4-7 Combined Statements of Revenues, Expenditures and Chan,esiDFundEquity-AllGovenu.ncntalFundTypcs .............................. 8 .. .. Combined Statements of Reveauea, Expenditures and Encumbrances - Buqet and Actual - Oeneral and Buqeted Special Revenue Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 9-10 .. Notes to the FlD8Dcial Statements . . . . . . . . . . . . .,. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 11-2S REQUIRED SUPPLEMENTAL INFORMATION .. Year 2000 (Y2K) Issue .................................................... 26 OTHER SUPPLEMENTAL INFORMATION .. Schedule of Findinp and Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 27-29 .. Town of Wappinger Responses to Findings and Recommendations . . . . . . . . . . . . . . . . . . . . .. 30-31 ... ... .. II. . Sedore & Company Certified Public Accountants, Pc. . . JomeJ L. Sedore. Jr.. G.P.A. Mork S. 0 'Sullivon, G.P.A. Jomer f: Letterio, Jr., G.P.A. Tereso A. Bor.rchi, G.P.A. Lindo M. HonniJ;on, G.P.A. RD. Box 918 . 62 East Main Street. II1Jppingers Falls. NY 12590 (9J4) 297-11JJ . Fox (914) 297-1432 www.sedoreandcompany.com Beocon (914) 831-0542 Newbu@ (914) 565-1373 - INDEPENDENT AUDITORS' REPORT .. .. To the Supervisor and Members of the Town Board Town of Wappinger, New York Wappingers Falls, New York 12590 - .. We have audited the accompanying general purpose financial statements of the Town of Wappinger, New York as of December 31, 1998, and for the year then ended as listed in the foregoing Table of Contents. These general purpose fmancial statements are the responsibility of the Town of Wappinger, New York's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. .. .. We conducted our audit in accordance with generally accepted auditing standards, and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. .. .. .. In our opinion, the general purpose fmancial statements referred to above present fairly, in all material respects, the fmancial position of the Town of Wappinger, New York as of December 31, 1998, and the results of its operations for the year then ended in conformity with generally accepted accounting principles. .. .. In accordance with Government Auditing Standards, we have also issued our report dated December 2, 1999 on our consideration of the Town of Wappinger, New York's internal control over fmancial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. .. III ~v!t",u '<- ('n,/~?:">;r ( Wappingers Falls, New York December 2, 1999 :; . '~ (} , / (/I, 'j .. .. 1 .. Sedore & Company Certified Public Accountants, PC .. ill Jame.r L. Sedore. Jr., CP.A. Mark S. 0 :Sullivan. CP.A. Jame.r F Letterio. Jr., CP.A. Teresa A. Bar.rchi. CP.A, Lindo A[, Hannigan, CP.A, p.o. Box 918 . 62 Eost Main Street. IIftppingers Falls, NY 12590 (9J4) 297-1111 . Fox (914) 297-1432 www.setWreandcompany.com Beacon (914) 831-0542 Newburgh (914) 565-1373 III REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF GENERAL PURPOSE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS .. ill .. To the Supervisor and Members of the Town Board Town of Wappinger Wappingers Falls, New York III We have audited the general purpose financial statements of the Town of Wappinger, New York, as of and for the year ended December 31, 1998, and have issued our report thereon dated December 2, 1999. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. . .. ill COlllPliance III As part of obtaining reasonable assurance about whether the Town of Wappinger, New York's general purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. We also noted certain immaterial instances of noncompliance that we have reported to the management of the Town of Wappinger, New York, in the Schedule of Findings and Recommendations listed in the Table of Contents. .. .. .. 11III Internal Control Over Financial Rq)Ortin& .. In planning and performing our audit, we considered the Town of Wappinger, New York's internal control over fmancial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose fmancial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control ill 2 III ill .. .. .. .. over financial reporting that might be material weaknesses. .. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. We noted other matters involving the internal control over financial reporting that we have fqJOrted to the management of the Town of Wappinger, New York, in the Schedule of Findings and R.ecommendations listed in the Table of Contents. .. .. .. This report is intended for the information of the Supervisor, Town Board and Management. However, this report is a matter of public record and its distribution is not limited. III ~rd,fiu "- &"7/)7' Wappingen Falls, New York I December 2, 1999 (?r/~,4, 's .. III .. .. .. .. III .. 3 .. .. TOWN OF WAPPINGER, NEW YORK COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS DECEMBER 31, 1998 III .. GOVERNMENTAL FUND TYPES GENERAL FUND ASSETS Cash and cash equivalents Cash from obligations - restricted Investments Receivables: Charges for services Other Due from other funds Due from other governments State and federal receivable Property, building and equipment Amounts to be provided for the payment of: Compensated absence obligations Long -tenn debt Total Assets $2.609,486 The accompanying Notes to the Financial Statements are an integral part of this fmancial statement. 4 SPECIAL REVENUE FUND $2.618,425 .. CAPITAL PROJECTS FUND .. $3,133,343 .. ... ... .. IIIIIIi .. .. .. ... .. .. .. ... FIDUCIARY FUND TYPE ACCOUNT GROUPS II TRUST & WNG- GENERAL TOTALS AGENCY TERM FIXED (MEMORANDUM FUND DEBT ASSETS ONLY) ... $252,469 $- $- $3,265,169 .. 1,178,319 2,357,978 563,631 III 74,977 906,743 243,906 23,000 .. 17,189,233 17,189,233 125,568 125,568 .. 20,860,000 20,860,000 $252,469 $20,985,568 $17,189,233 $46,788,524 ... .. ... .. ... ... II III .. .. 5 .. .. - .. ... .. The accompanying Notes to the Financial Statements are an integral part of this financial statement. ... 6 .. ... .. .. FIDUCIARY FUND TYPE .. ACCOUNT GROUPS .. TRUST & AGENCY FUND LONG- TERM DEBT GENERAL FIXED ASSETS TOTALS (MEMORANDUM ONLY) .. $- $- $- $228,015 35,252 2,896,000 .. 906,743 12,513 12,334 252,469 252,469 .. 125,568 125,568 20,860,000 20,860,000 252,469 20,985,568 0 25,328,894 .. 17,189,233 17,189,233 ... 35,679 459,714 .. 2,302,324 1,472,680 .. 0 0 17,189,233 21,459,630 $252.469 $20.985.568 $17.189.233 $46.788.524 .. iIIlIII .. lilt .. .. 7 lit .. .. TOWN OF WAPPINGER, NEW YORK COMBINED STATEMENTS OF REVENUES, EXPENDITURES AND CHANGES IN FUND EQUITY _ .. ALL GOVERNMENTAL FUND TYPES FOR THE YEAR ENDED DECEMBER 31, 1998 .. GOVERNMENTAL FUND TYPES SPECIAL CAPITAL TOTALS GENERAL REVENUE PROJECTS (MEMORANDUM .. FUND FUND FUND ONLY) REVENUES Real property taxes $1,143,764 $3,773,384 $- $4,917,148 IiIII Real property tax items 91,488 91,488 Non property tax items 925,729 925,729 Departmental income 108,387 1,720,636 1,829,023 Intergovernmental charges 1,620 2,334 3,954 .. Use of money and property 218,518 603,173 82,640 904,331 Licenses and permits 80,023 80,023 Fines and forfeitures 198,950 198,950 Sale of property and compensation for loss 2,566 3,900 6,466 .. Miscellaneous local sources 960 25,277 43,855 70,092 State aid 684,311 118,949 803,260 Total revenues 3,456,316 6,247,653 126,495 9,830,464 .. EXPENDITURES .. General government support 1,166,884 380,651 1,547,535 Public safety 240,440 240,440 Health 1,590 231,700 233,290 Transportation 108,938 1,332,977 1,441,915 IiIII Economic assistance and opportunity 6,826 6,826 Culture and recreation 527,150 527,150 Horne and community services 304,335 1,684,735 998,200 2,987,270 Employee benefits 258,001 215,911 473,912 .. Debt service 627,917 2,474,416 3,102,333 Total expenditures 3,242,081 5,939,739 1,378,851 10,560,671 .. Excess (deficiency) of revenue over expenditures 214,235 307 ,914 (1,252,356) (730,207) Other f"mancing sources (uses): ill Proceeds of debt 510,000 510,000 BANS redeemed from appropriations 245,000 245,000 iotal other financing sources ( uses) 0 0 755,000 755,000 ill Excess (deficiency) of revenue and other sources over expenditures and other uses 214,235 307,914 (497,356) 24,793 III Fund Equity, December 31,1997 2,293,327 2,107,672 (128,225) 4,272, n4 Fund Equity, December 31,1998 $2,480,392 $2.415.586 ($625,581) $4.297 .567 .. .. The accompanying Notes to the Financial Statements are an integral part of these fmancial statements. 8 .. .. .. TOWN OF WAPPINGER, NEW YORK COMBINED STATEMENTS OF REVENUES, EXPENDITURES AND ENCUMBRANCES - BUDGET AND ACTUAL- GENERAL AND BUDGETED SPECIAL REVENUE FUNDS FOR THE YEAR ENDED DECEMBER 31. 1998 IlIIIii GENERAL FUND ... VARIANCE REVISED FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES .. Real property taxes $1,143,764 $1,143,764 $0 Real property tax items 50,000 91,488 41,488 Non property tax items 650,000 925,729 275,729 ... Departmental income 112,380 108,387 (3,993) Intergovernmental charges 1,620 1,620 Use of money and property 228,000 218,518 (9,482) Licenses and permits 45,100 80,023 34,923 IlIIIii Fines and forfeitures 101 ,500 198,950 97,450 Sale of property and compensation for loss 2,566 2,566 Miscellaneous local sources 1,500 960 (540) State aid 490,000 684,311 194,311 ... Federal aid Total revenues 2,822,244 3,456,316 634,072 Appropriation of prior's year's fund balance 984,113 (984,113) .. Total revenues and appropriation of prior year's fund balance 3,806,357 3,456,316 (350,041) - EXPENDITURES AND ENCUMBRANCES General government support 1,409,050 1,192,053 216,997 Public safety 279,582 242,221 37,361 .. Health 1,590 (1,590) Transportation 130,510 110,046 20,464 Economic assistance and opportunity 7,640 6,826 814 Culture and recreation 584,839 529,555 55,284 III Home and community services 435,482 309,551 125,931 Employee benefits 331,335 258,001 73,334 Debt service 627,919 627,917 2 ... Total expenditures and encumbrances 3,806,357 3,277,760 528,597 Excess (deficiency) of revenues and appropriation of .. prior year's fund balance over (under) expenditures and encumbrances $0 $178,556 $178,556 ...- .. ... The accompanying Notes to the Financial Statements are an integral part of these financial statements. .. 9 ... .. .. iIII .. .. .. 10 .. .. ... .. .. TOWN OF WAPPINGER, NEW YORK NOms TO THE FINANCIAL STATEMENTS DF..cEMRER 31, 1998 .. NOTE A - SllmmA~ or Aeeountlnr PollrlM The Town of Wappinger, New York ("the Town") was incolpOrated on May 20, 1875, under the provisions of the State of New York. The Town operates under a Town Board form of govemmmt, consisting of a Supervisor and four Councilmen/women. The Supervisor serves as the Chief Executive Officer and as the Chief Fiscal Officer of the Town. The Town provides the following services: highway maintenance, water, sewer, planning, zoning, building and safety inspection, lighting, and culture and recreation. The financial statements of the Town have been prepared in conformity with generally accepted accounting principles (GAAP), as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles, some of which are as follows: .. .. .. .. .. .. ... ill III .. IIIJ .. ~ - .. 1. The Reporting Entity The Town, for financial purposes, includes all of the funds and account groups relevant to the operations of the Town of Wappinger, New York. The fmancial statements 'include organizations, functions and activities that are controlled by or dependent upon the Town. Control or dependence is determined on the basis of budget adoption, taxing authority, funding and appointment of the respective governing board. Fund Accounting The aa:ounts of the Town are organized on the basis of funds or account groups, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self-balancing accounts, which are comprised of each fund I S assets, liabilities, fund equity, revenues and expenditures. Government resources are allocated to and for individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report, into fund types and two account groups, as follows: 2. GOVERNMENTAL FUND TYPES The accounting and reporting treatment applied to assets and liabilities associated with a fund are determined by its measurement focus. All governmental fund types are accounted for on a spending "financial flow" measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. Their reported fund balance (net current assets) is considered a measure of "available 11 .. .. I!lI TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DECEMBER 31, 1991 .. .. SumlNry of AccountiDa PoUcles (Continued) spendable resources." Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of wavailable spendable resourcesW during a period. General Fund IIIIl. .. The General F~d is the general operating fund of the Town. It is used to account for all fmancial resources except those required to be accounted for in another fund. Speclal Revenue Fund Special Revenue Fund is used to account for the proceeds of specific revenue sources (other than special assessments, expendable trust or major capital projects) that are legally restricted to expenditures for specified purposes. Capital Projects Fund This fund is used to account for financial resources to be used for the acquisition and construction of major capital facilities. ... IlIIiII iIIIt .. FIDUCIARY FUND TYPE III TnIst and Agency Fund Trust and Agency Fund is used to account for assets held by the Town in a trustee capacity, or as an agent for individuals, other governments, and/or other funds. These include Expendable Trust and Agency Funds. Expendable Trusts are accounted for in essentially the same manner as governmental funds. Agency funds are custodial in nature (assets equal liabilities), and do not involve measurement of results of operations. .. .. ACCOUNT GROUPS .. . Account groups are used to establish accounting control and accountability for General Fixed Assets and General Long-Term Debt. The two account groups are not "funds. W They are concerned only with the measurement of financial position. They are not involved with the measurement of the results of operations. IIIira ... .. 12 III III TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DECEMBE1l31, 1998 Sumnutry of Aceountin& PoUdes (Contlaued) General Fixed Assets Account Group Property, plant and equipment used in govemmental fund type operations are accounted for in the General Fixed Assets Account Group, rather than in govemmen1al funds. No depn:ciation bas been provided on such property, plant and equipment. . All property, plant and equipment are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated property, plant and equipment are valued at their estimated fair value on the date donated. Interest costs incurred during construction have not been capitalized, however. The Town bas adopted the accounting policy of not capitalizing "infrastructure" general fixed assets (roads, bridges, curbs and gutters, streets and sidewalks, drainage system, lighting systems and similar assets) that are immovable and of value only to the Town. . . General Lona-Term Debt Account Group Long-term liabilities expected to be financed from lovemmental fund types are accounted for in the General Long-Term Debt Account Group, not in the governmental funds. They are recorded at the par value of the principal aJt1ount. No liability is recorded for interest payable to maturity. Because of their spending measurement focus, expenditure recognition for governmental fund types is limited to exclude amounts represented by non- current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. They are instead reported as liabilities in the General Long-Term Debt Account Group. 3. Basis of Aceountin& Basis of accounting refers to when revenues and expenditures are recognized in the accounts; and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. All governmental and expendable trust funds are accounted for using the "modified accrual basis" of accounting. Their revenues are recognized when they become measurable and available as net current assets. All major revenues are susceptible to accrual. III III .. .. .. III .. .. .. III III III III III .. .. .. 13 ... .. TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONTID.) DECEMBER 31, 1991 .. .. Sllm~.,. of Accounting PoUcles (Continued) Expenditures are generally ~ under the wmodified accrual basis. of accounting when the related fund liability ls.incurred. Exceptions to this general rule include: (1) accumulated unpaid vacation, sick pay, and other employee amounts which are not accrued; (2) principal and interest on general long-term debt which is recognized when due; and (3) expenditures for inventory-type items which are recognized at the time of purchase. Expenditures for judgments and settled claims are also recognized when the related liability is incurred, that is when the judgment bas been rendered or settlement has been reached. Unsettled claims and contingencies are recognized only if it is probable that an asset has been impaired or a liability has been incurred and the amount of the impairment or liability can be reasonably estimated. 4. Budgets The Town employs a formal budgetary accounting system as required by law. During the year, a budget was adopted and modified by the Town Board for the General Fund and Special Revenue Fund. However, for the Capital Projects Fund, budgets are established at the project level and continue until the project is completed. Unused appropriations of the annually budgeted funds lapse at the end of the year. Encumbrances s. .. .. .. .. .. .. .. Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded for budgetary control purposes to reserve that portion of the applicable appropriations, is employed as a control in preventing over expenditure of established appropriations. Open encumbrances are reported as reservations of fund balance since they do not constitute expenditures or liabilities and will be honored through budget appropriations in the subsequent year. 6. Budget and Actual Comparison The budget and actual Comparison for Special Revenue Funds, included in the Combined Statement of Revenues and Expenditures - Budget and Actual, reflects budgeted and actual amounts for funds with legally authorized (appropriated) budgets. Certain Special Revenue Funds have not been included in the comparison because they do not have legally authorized (appropriated) budgets. The actual activity of these unbudgeted funds, as follows, is provided in order to reconcile to the total combined balances of the Special Revenue Funds: III iIlII .. . .. III .. .. 14 .. TOWN OF W APPJNGER, NEW YORK NOTFS TO THE FINANCIAL STATEMENTS (CONT'D.) OECEMBER 31, 1998 Summary of Accountlnl PoHcles (Continued) JANUARY 1, REVENUES 4 (EXPENDITURES DECEMBER 31, 1998 _ OTIIER SOlJRrF1'~ at OTHER USJl:S\ J998 Total for funds Included in Budaet ComparillOll $2,013,200 $6,197,653 $(5,889,739) $2,321,114 .. .. .. .. Funds not iIlcluded in Bwad Comparison 50.000 (50.000) Total Special Rev_ue Funds $2.013.200 $6.247.653 $(5.939.73n $2.321.114 .. 7. Cash and Investments Cash includes amounts in demand and time deposits, as well as, short-term investments. State statutes and the Town's own written investment policy govern the investment policies of the Town. Short-term investments consist of investments in repurchase agreements. The repurchase agreements involve purchases by a broker of portfolio securities concurrently with an agreement by the broker to sell the same securities ata later date at a fixed price. Generally, the effect of such a transaction is that the Town can invest its excess cash balances at competitive interest rates. Market value of the repurchase agreements approximates cost plus accrued interest. The cash and investments of the Town at December 31, 1998, are as follows: .. .. .. .. .. SPECIAL CAPITAL TRUST &: GENERAL REVENUE PROJEcrs AGENCY FUND FUND FUND FlJND TOTAL Non-Interest Bearing Accounts S 800 S S S S 800 Interest Bearing Accounts 548,532 1,332,102 1,131,266 252,469 3,264,369 Restricted - Non-Interest Bearina 1,178,319 1,178,319 Rqnuchase Agreements 1.035.8'7 579.564 742.527 2.3S7.978 TOTAL ~1.585.~19 $1.911.666 $3.052.112 $252.469 $6.801.466 .. .. .. .. ... All of the Town's deposits were covered by Fedeml Deposit Insurance or collateralized with securities held by a third party custodian in the Town's name, except for approximately $19,000 which was covered in the subsequent year. Cash from obligations - restricted represents unspent bond proceeds whose use is limited to funding certain construction projects. This restricted cash is more further described in Note I - Commitments and Contingent Liabilities, Item 3 - Tri-Municipal Sewer Plant Expansion. .. ... IS III SumllUllry of Accountina PoUcies (Contlnued) 8. Accumulated Compensated Absences It is the Town's policy to permit employees of the Highway Department to accumulate a limited amount of earned but unused vacation and sick leave, which will be paid to employees upon separation from the Town's service. Other Town employees accumulate unused compensated absences. However, such earned, but unused compensated absences, must be used during their period of employment with the Town. No payment will be made upon separation from the Town's service. In governmental and fiduciary funds, the cost of vacation and sick leave is recognized when payments are made to employees. A long-term liability of SI2S,S68 of accrued vacation and sick leave at December 31, 1998, has been recorded in the General Long- Term Debt Account Group of Accounts, representing the Town's commitment to fund such costs from future operations. Pension Plans - .. .. .. III .. I11III I11III I11III .. .. .. I11III .. .. .. .. .. .. TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONTID.) DECEMBER 31, 1998 9. Plan De~ription The Town of Wappinger participates in the New York State and Local Employees' Retirement System (ERS), and the Public Employees' Group Life Insurance Plan (Systems). These are cost-sharing multiple-employer retirement systems. The Systems provide retirement benefits as well as death and disability benefits. Obligations of employers and employees to contribute and benefits to employees are governed by the New York State Retirement and Social Security Law (NYSRSSL). As set forth in the NYSRSSL, the Comptroller of the State of New York (Comptroller) serves as sole trustee and administrative head of the Systems. The Comptroller shall adopt and may amend roles and regulations for the administration and transaction of the business of the Systems and for the custody and control of their funds. The Systems issue a publicly available financial report that includes financial statements and required supplementary information. That rePort may be obtained by writing to the New York State and Local Retirement Systems, Gov. Alfred E. Smith State Office Building, Albany, NY 12244. Fundine Poli~ The Systems are noncontributory except for employees who joined the New York State and Local Employees' Retirement System after July 27, 1976 who contribute 3% of their salary. Under the authority of the NYSRSSL, the Comptroller shall certify annually the tates expressed as proportions of payron of members, which shall be used in computing the contributions required to be made by employers to the pension accumulation fund. 16 .. .. TOWN OF WAPPINGER, NEW YORK NOTES TO mE FINANCIAL STATEMENTS (CONT'D.) DECEMBER 31, 1998 SnmlllRry of Ac:countiq Policies (Continued) The Town of Wappinger is required to contribute at an actuarially determined rate. The required contributions for the current year and two preceding years were: .. .. .. 1998 1997 1996 II .. The Town's contributions made to the Systems were equal to 100 percent of the contributiot:ls required for each year. .. 10. Post Employment Benefits In addition to providing pension benefits, the Town provides health insurance coverage and survivor benefits for retired employees and their survivors. Substantially all of the Town employees may become eligible for these benefits if they reach nonnal retirement age while working for the Town. Health care benefits and survivors benefits are provided through an insurance company whose premiums are based on the benefits paid during the year. The Town recognizes the cost of providing benefits by recording its share of msurance premiums as an expenditure in the year paid.. Employees contribute according to a sliding scale based on years of service. For the year of 1998, $17,369 was paid on behalf of eleven retirees and recorded as expenditures in the General. and Special Revenue Funds. 11. Property Taxes The Town submits an approved budget to the Dutchess County Commissioner of Finance by December 5th of the previous year. The County then establishes the warrant for the year which is due and payable on or about January 1 of each year. The Town collects the taxes on behalf of the Town ~d County without penalty through February 28th and with penalties and interest through August 31st. The Town's portion of the taxes is collected and transferred prior to the County's portion. Therefore, the Town receives its entire tax levy, leaving the unpaid taxes to be collected by the County Commissioner of Finance. . .. .. .. .. .. .. .. 12. Lonl- Term Obli&atioDS .. Long-Term Debt is recognized as a liability of a governmental fund when due, or when resources have been accumulated in the debt service fund for payment early in the following year. For other Long-Term Obligations, only that portion expected to be .. financed from expendable available fmancial resources is reported as a fund liability of a governmental fund. The remaining portion of such obligations is reported in the General Long-Term Debt Account Group.. .. ... 17 ... .. TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DECEMBER 31, 1998 Summary of AccountiBg PoUcies (Continued) - .. 13. .. .. .. 14. .. .. .. .. .. IDsuraDce The Town of Wappinger asSumes the liability for most risk including, but not limited to, property damage and personal injury liability. Such risks are covered by the purchase of commercial insurance. Judgements and claims are recorded when it is probable that an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. Workers compensation coverage is provided through a retrospective policy, wherein premiums are recorded based on the ultimate cost of the experience to date of workers in similar occupations. Reserves of Fund Equity . The Town records indicate that portions of the fund equity are segregated for a specific future use. The following details the description and amounts of the reserves used by the Town: BALANCE AT DECEMBER 31, 1998 General Fund Reserved for Encumbrances Reserved for Miscellaneous: Inspection Fees DoWDStream Draiuge Total Miscellaneous Reserves $ 35,679 330,000 129.714 459.714 TOTAL $495.393 15. Allowance for Uncollectible Accounts III An Allowance for Uncollectible Accounts is not reflected in the Special Revenue Fund. Accounts past due after one year are placed on the property tax rolls for collection, and reimbursed to the Town by the County of Dutchess if the property taxes remain unpaid. III 16. .. .. .. .. .. .. Total Columns on Combined Statements Total Columns on the Combined Statements - Overview are captioned "Memorandum Only" to indicate that they are presented onl)' to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Such data is not comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. 18 .. TOWN OF W APPlNGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DRCRMBER 31 r 1998 SnmmAry of Accouqt1na Policies (Continued) ilia IIiIlI NOTE B - Other Reeeivables III Other Receivables at December 31, 1998 consist of the following: GENERAL FUND .. Fm. aad Feee Receivable S 74.fY17 .. .. NOTE C - Interfund Reeelvables and PsQrables The following is a summary of amounts due from and due to other funds as of December 31, 1998: DUE TO DUE FROM III General Fund $ $705,384 Capital Projects Fund 769,530 81,231 Special Revenue Fund 23,000 - Water Fund 15,254 11 ,267 Sewer Fund 98r 959 108,861 TOTAL ~.743 ~ III .. NOTE D - General Fixed A.~ Aeeount Gro..p .. The following is a summary of changes and adjustments in the General Fixed Assets Account Group, for the year ended December 31, 1998: ... BALANCE . JANUARY 1, 1991 ADDmONS BALANCE . DECEMBER 31, (pRI.ETlONSl 1998 .. Land Buildings Improvement Other Than Buildings Machinery and Equipmeat S 5.284.650 6.197.705 s . 75,578 s S 5.284.650 6,273.283 .. 2.892.058 2.892.058 2.630.99~ 108.249 : 2739.242 .. TOTAL $ 17.OOS.406 $183.827 ~ $17.189.233 ... - - 19 .. III III TOWN OF WAPPINGER, NEW YORK NOTES TO mE FINANCIAL STATEMENTS (CONT'D.) DECEMBER 31, 1998 NOTE E - Bpnd Antl~tion Notes PsQrable Bond Anticipation Notes Payable are renewed annually and are not to exceed five renewals, except for water and sewer improvements which may be renewed for the life of the improvement not to exceed twenty years. . The Bond Anticipation Notes outstanding as of December 31, 1998, are as follows: AMOUNT OUfSTANDING AT DECEMBER 31, 1998 NOTE F - Lona-Tenn Debt 1. Serial Bonds The Town borrows money in order to acquire or construct buildings and public improvements. This enables the cost of these capital assets to be. bome by the present and future taxpayers receiving the benefit of the capital assets. These long-term liabilities, which are full faith and credit debt of the Town, are recorded in the General Long-Term Debt Account Group. The provision to be made in future budgets for capital indebtedness represents the amount, exclusive of interest, authorized to be collected in future years from taxpayers and others for liquidation of long-term liabilities. The Serial Bonds Payable, as of December 31, 1998, are as follows: .. III III PURPOSE .. Waf<< W.. Sower Sower Sewer Sewer I..IDdfill Dean Property Subtotal .. .. .. EIllelpACY Service BId. .. .. .. .. .. .. . PURPOSE Waf<< Sewer Draina&e ... .. - ORIGINAL ISSUE DATE MATURITY DATE 09/17/91 09/16192 09/17191 07/14/94 07/11196 07K1J198 07109198 07/09198 07/09199 07/09199 07/09199 07 K1J199 07/09/99 07/09199 07/09199 07109199 07 K1J198 1)7 K1J199 TOTAL ORIGINAL ~ AMOUNTOF RATE N.~ 3.63 " S 375,760 $ 233,000 3.63 " 30,500 8,000 3.63 " 4,000,000 1,000,000 3.63 " 375,000 300,000 3.63" 403,000 230,000 3.63 " 180,000 180,000 3.63 " 580,000 550,000 3.63 , \55.000 155.000 6.099.260 2.656.000 3.74" 390.000 240.000 $6.489.260 2.896.000 S.O~ ORIGINAL AMOUNT OF ls..cmE $ 66,000 104,000 1.125.000 1.295.000 AMOUNT OUl'STANDlNG AT DECEMBER 31, 1998 $ 2,600 4,000 43.400 50.000 ISSUE MATURITY INTEREST DATE DATE RATE 09'()1-71 03'()1-99 20 ... 21 ... .. .. TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DECEMBER 31, 1991 .. NOTE F - Lonl-Tenn Debt {Continued} .. YEAR ENDING DECEMBER 31, 1999 2000 2001 2002 2003 Thereafter INTERR.~ 1,2S9,520 1,179,900 1,098,926 1,015,224 930,236 5.015.391 '10.519.197 PRINCIPAL 1,433,000 1,408,000 1,433,000 1,458,000 1,443,000 13.68S.000 ~20.860.~ .. III TOTAL 2,692,520 2,587 ,900 2,531,926 2,473,224 2,373,236 111.720.391 ~31.31,.197 2. Chanlt'Jil The changes in the Town's indebtedness during the year ended December 31, 1998, are summarized as follows: .. .. .. BALANCE - JANUARY 1, 1998 ADDmONS lREDUCTlONS) Serial Bonds $21,793,000 $ 510,000 $(1,443,000) l.AlJdfil) CloSUJe and Post-Closure Costs - Note J 550,000 (550,000) CompeDS8ted Absences - Note A.S 129.996 - t4.421O Total $22.472.996 $ ~10.000 $(1,997 .428\ NOTE G - Operatll1l ,.P...... III .. .. .. BALANCE - DECEMBER 31. 1998 $20,860,000 12S.~68 $20.985,5~8 The Town is committed under various leases for office equipment and communication equipment. These leases. are considered for accounting purposes to be operating leases. Lease expenditures for the year ended December 31, 1998 amounted to $26,912. At December 31, 1998, the approximate annual operating lease commitments, subject to appropriation of funds, were as follows: .. III YEAR ENDING DECEMBER 31, 1999 2000 2001 2002 2003 OPERATING LEASES 25,962 23,283 22,608 19,158 ....1.m .. III TOTAL MINIMUM LEASE PAYMENTS $96.432 III 22 .. .. ill .. .. .. .. .. lit .. .. 1. .. lit 2. .. ... .. ... .. .. .. TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) . DF..cEMBER 31, 1998 NOTE H - Dendt Fund 1IAlan~ Certain Capital Projects.had deficits of fund equity at the end of the year which are listed below. These deficits arose through the funding of expenditures by issuing bond anticipation notes. As the notes are paid, revenue will be recognized and the deficits will be eliminated. Fleetwood Water ~ Oakwood Knolls Water nD Emergency Services Building ~ Tri.Municipal Sewer Phase 3.A ~ Castle Point I..andfill ~ Purchase. Dean Property ~ Tri.Municipal. Plant ~ NOTE I - Commitments ,nd Contil1~t 1.labilities The Town is a defendant in various lawsuits and tax certiorari cases. The outcome of these cases and lawsuits, as determined by the Town Attomey, should not result in material unfavorable settlements. Any return of property taxes made as a result of the settlement of a tax certiorari case is funded by an increase in the property taxes collected in the year subsequent to payment. The Town has received amounts from grantor agencies, principally the Department of Housing and Urban Development. Any allowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of ex.penditutes which may be disallowed by the grantor agency cannot be determined at this time. 3. Tri-Munldpal Sewer Plant Eltpaafdon An initial consent judgement was executed between the Town and the New York State Department of Environmental Conservation dated Apri118, 1988 regarding alleged environmental violations. Due to numerous technical difficulties, the Town of Wappinger was unable to meet the threshold dates contained in the consent judgement, and an amended consent judgement was re.negotiated and approved by both parties. This amended consent judgement required the Town to construct a sewer line to the Tri- Municipal Sewer Treatment Plant plus a one million gallon expansion of said plant. The Town, however, does not own the plant nor does it have voting rights on the Commission's governing board. The plant is owned and operated by the Tri.Municipal 23 - III TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DEC~ER 31, 1" 11III NOTE I - Commitment.. and Cnnt;~r..nt 'J.hUItl.... (~nntin,,~ III Sewu Commission, made up of representatives of the Town of Poughkeepsie and the Village ofWappingers Falls. ConstructioIl is on-going; however, as a result of additional difficulties between the Tn-Municipal Sewer Commission and the Department of Environmental Conservation, delays have occurred and a Third Amended Judgement wu agreed to, extending the date of completion to July 1, 1997. The Town was able to bepn. using the expaaded capacity as of July 1, 1997, however, certain construction re1ated costs continue to be incurred. III III , Funding for the project has been provided by two authorizations for a total project cost of $19,630,054. Through December 31, 1998, $17,189,840 in bonds have been ISSUed through the Environmental Facility Corporation and $2,060,4.14 in Bond Anticipation Notes have been issued. .. .. To1al project costs incurred through December 31, 1998, amounted to $18,121,260. Under the terms of. the agreements with the Environmental Facility Corporation, aerial bond proceeds are Rquired to be deposited into a Construction Fund Account, be invested in U.S. . Treasury securities until drawn upon, and be subject to regulatory approvals before being drawn upon. The unspent balance in the Construction Fund Account amounted to $1,178,319 as of December 31, 1998, and is classified as a Restricted Asset. III .. 4. Tn Munie'pal Sewer Plant EQSln~ion - PbSl~ mA .. In May 1997, the ToWll entered into a contract with the Tri-Municipal Sewer Commission with regaxd to the further expansion of the Commission I S sewage treatment facility, from 2.4 million gallon per day capacity to 3.4 million gallon per day capacity, the costs of which will be funded 'by the Town. In January 1999 the Town Board authorized the Phase 3A Sewer Improvement Project based on the May 1998 map, plan and report. The Town estimated construction and Rlated project costs to be $10,400,000. The Town has incurred $645,578 in engineering and legal fees to date, pertaining to the preparation of the map, plan and report, authorized in prior years. NOTE J - Muni..ipal tAndfilk 1. Castle Point l....ridftll 'The Town has voluntarily entaed into a Consent Order with the New York State Department of Environmental Conservation to close, cap and monitor the landfill at Castle Point. The closing and capping project was completed in 1998, with project expenditures amounting to $571,720. The costs of monitOring, which could be required for up to thirty fears after closure, have not been estimated since an agreement with the Department of EnVlfOnmental Conservation has not yet been reached as to the nature and extent of required monitoring. The costs of both closure and poste. losurc monitoring are ordinarily recognized. over the expected useful life of the landfill. However, since the landfill has stopped accepting refuse, all costs are being recognized as the terms of closure and postclosure requirements are determined. The actual costa may be higher due to inflation, changes in technology or subsequent changes in regulations. .. .. . .. . - .. 24 III .. .. TOWN OF WAPPINGER, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (CONT'D.) DECEMBER 31, 199$ .. NOTE J - Municipal '....ndfllk (~ontlnuedl - The Town has been notified that it is e1ifble to receive up to $275,000 in grant funds through the New York State Department of EnVU'OlUllental Conservation Landfill Qosure Assistance Program, based on eligible expenditures. This aid is expected to be received in 1999. .. .. 2. POQlhk~pde-Wswplnr~n-LaGl'Rnu Joint '...ndtlU The Town bas shared in the monitoring costs of a closed landfill, the Poughkeepsie- Wappinger-LaGrange Joint Landfill. This joint activity includes the City and Town of Poughkeepsie, the Village of Wappingers Falls and the Town of LaGrange, as well as the Town of Wappinger. All costs associated with monitoring are recognized as incurred. No assessment of the extent and cost of future monitoring costs has been made. Any' such costs will be shared equally among the five municipalities. The Town's share of momtoring costs for the year ended December 31, 1998 amounted to $2,500. Financial statements are available from the Joint Landfill's Board. Summarized unaudited financial information is as follows: .. .. .. Total Assets Total Liabilities Total Fund Balance mJ.21 JW24 ~ .. iIIII NOTE IS: - Subsequent Events .. The Town has authorized, but not issued, the following new debt: .. Authotiution PulJ)05e Date Amount Refunding Bonds 02/01199 $4,700,000 Highway Equipment OS/24/99 $363,544 Central Wappingers $500,000 Water Improvements 09/13/99 ill .. ill .. 2S .. .. - .. lilt lilt lilt - REQJJlRlm S1JPP1~EMF.NTAL INFORMATION ilIlII .. lilt ilIlII lilt - ilIlII lilt lilt ilIlII .. .. .. .. - TOWN OF WAPPINGER, NEW YORK REQUIRED SUPPLEMENTAL INFORMATION DF~ER 31, 1991 .. The YeAr 2000 lY2Kl Iaue .. The Governmental Accounting Standards Board requires state and local governments to disclose information about the effect of tile Y2K issue. The Y2K issue is the result of shortcomings in many electronic data processing systems and other equipment that make operations beyond the ~ 1999 troubleaome. Problems affecting a wide range of governmental activities could result If computers and other electronic equipment tbat are dependent upon date--sensitive coding are not corrected. These problems have the potential for causing a disruption of government services and an increased demand for government services. The Y2K issue is a worldwide issue that affects governments and the private sector whose operations are interdependent in many situations. The Y2K issue could cause significant disruption of services. At December 31, 1998 the Town had committed funds for Y2X compliance changes through its 1999 budget. The Town has identified certain computer systems to be critical to operations, specifically those ~ to the processing of financial transactions and related rec:ord.keeping. The assessment, remediation and validation of these systems is expected to be performed during 1999. The Town is dependent on outside processing of portions of its revenues, specifically property tax and sales tax revenues, which are handled by Dutchess County. The Town would not be able to coll!:'Ct these revenues in the short term if the County'. systems were unable to perform these services. The Town does have the legal authority to borrow funds in anticipation of the receipt of these revenues, although the timing of such borrowings may not coincide with the need for disbursements. While the Town is making an effort to obtain Y2K compliance in critical areas, it cannot provide complete assurance tbat it will be Y2K compliant by January 1, 2000, nor can it provide complete assurance that supplier's of essential services will also be Y2K compliant by January 1, 2000. .. iIIIl .. .. iIIIl .. .. .. .. iIIIl .. .. ... 26 ... - III III III .. .. .. OTHER SUPPLR~AL INFORMATION 1M .. ... ... .. 1M III .. 1M .. ... ... III .. III TOWN OF WAPPINGER, NEW YORK SCHEDULE OF FINDINGS AND RECOMMENDATIONS FOR THE YEAR ENDED DECEMBER 31, .1998 .. OTH Ii:K MATTERS: .. Prior Y"-Slr 1i1ndinr - Contlmdnr= Flndln.l- Tn~lolUI .. Cause: The ToWll has included inspection fees in escrow accounts where the purpose for holdina these funds is unclear. These fees have been collected for inspections which may not be necessary . Funds are being held indefinitely. The Town should review its procedures for the assessment of inspection fees so that the fee is recorded in accordance with the purpose of the fee, being either refundable or a revenue. .. Findinr: .. Effect: Recommendation: .. Current Year Findl"p: .. Findinr 1 - ~row Funds .. Ca1L~: Payments have been made in excess of escrow amounts collected resulting in excess payments to individual project owners/developers, of approximately $65,970. The Town collects escrow funds to ensue that costs incurred by the Town, while projects or subdivisions are being considered by the Planning Board, are bome by the applicants. The Town maintains records for each project/applicant so that balances can be monitored, however, in some cases the disbursements exceeded the escrow collected. Unanticipated liabilities could be incurred by the Town for which no revenues/funds bad been provided. We note the Town has had previous difficulties in accounting for and reconciling escrow receipts and disbursements. We recommend that the Town increase its monitoring efforts by providing for at least quarterly reconciliations of transactions. A list of projects that are over-expended should be circulated to interested parties, at a minimum, the Supervisor and Town engineer, as well as building and accounting department personnel. We also recommend that procedures for the return of unexpended proceeds be changed to provide for sign-off by both the building and accounting departments before authorization is requested of the ToWll Board. Findinr= .. .. Effect: .. Recnmmendation: .. .. .. .. 27 .. .. .. .. TOWN OF WAPPINGER, NEW YORK SCHEDULE OF FINDINGS AND RECOMMENDAnONS (CONT'D.) FOR THE YEAR ENDED DEC'fMBER 31r 1998 .. Find;nr 2- Collateral - Findinl! At December 31, 1998 the Town's deposits were under collateralized by approximately $19,000. One Town bank account was omitted from the listing of those to be covered by collateral by one of the Town's depositories. The Town had aD increased risk of loss in the event of a bank failure or other condition resulting iri an inability to access public funds. The Town was also in violation of Oeneral Municipal Law section 10 which requires collatera1ization of all deposits in excess of federal deposit insurance coverage. The Town should review its monitoring procedures so that, at least on a monthly basis, collateral pledges are matched with funds on deposit and differences investigated. .. Cause: IIiIlIII Efred: .. R~ommendatlon~ IIiIlIII III Findinr 3 - Sehool Tax Colledlons .. FindlDr: Interest earned on school tax collections has been remitted to the Town instead of the school district. School property tax collections have been deposited into the same account as town tax collections. Cause: III Erred: The Town is retaining revenues which belong to another municipality. Bnd-of-collection period procedures should be modified to include a reconciliation and payment of interest earned on school tax deposits due to the school district. IIiIlIII R~ommp.ndation: ... Flndlnr 4 - Puftha.~ Order System III FindlDr: End-of-year outstanding encumbrances per the accounting system significantly exceeded purchase orders actually open. Payments had been processed without releasing the related purchase orders. .. Cause: III Erred: Payments may.be made in conttadiction of the approved purchase order, budget commitments may be overstated. .. 28 .. .. .. .. TOWN OF WAPPINGER, NEW YORK SCHEDULE OF FINDINGS AND RECOMMENDATIONS FOR THE YEAR ENDED DECEMBER 31f 1998 III Recommendation: Procedures for the use of purchase orders should be reviewed so that when invoices are received for goods or services they are matched with III p~base order authorizations and appropriate adjustments made. Open purchase onters should be periodically compared to incumbrance listings prepared by the accounting system. III lilndi-.-a ! - Fixed ~ III Cause: The Town did not record any disposals of fixed assets during the year. 'The Town has not taken an inventory of fixed assets and compared items on hand with its records in sometime. The Town's fixed assets could be overstated. Ftndi-.-I: III Efted: III Recommendation: The Town should periodically inventory its fixed assets, whether by hiring an outside consultant or requesting employees to compare updated lists to items OIl banel. Periodic inventories enable the Town to maintain accountability by those employees using Town assets and to prevent loss. III III .. .. .. .. .. .. .. 29 .. .. .. TOWN OF WAPPINGER CONSTANCE O. SMITH SUPERVISOR o~ ,!!~~p~' ". .~~.U./~. -, '<'~"'..' ." .-' - ... -.: \ / .' .:- ~.."L\'~ o . . ....- .~'~\\ I ~...\. .r:.'~'. .....)\ >.......... '" . . I' '"" . ~. ~\4iI ~_I (\....':'!It . /"./ ~{"SS~CO~~ SUPERVISOR'S OFFICE 20 MIDDLEBUSH ROAD P.O. BOX 324 WAPPINGERS FALLS. NY 12590-0024 .. .. TELEPHONE: (914) 297.2744 FAX: (914) 297-4558 .. .. .. TOWN OF WAPPINGER FINDINGS AND RECOMMENDATIONS RESPONSES TO AUDIT FOR THE YEAR ENDING DECEMBER 31, 1998 .. Prior Year Finding .. FINDING 1: Inspections The Town has included inspection fees in escrow accounts where the purpose for holding these finds is unclear. .. RESPONSE 1: Corrective action will be taken as soon as possible. .. .. FINDING 2: Collateral At December 31, 1998 the Town's deposits were under collateralized by approximately $19,000. .. RESPONSE 2: At the time, we were using Fleet Band and they did not have one of the Justice accounts listed as collateral. This has now been corrected. IiiIIl .. FINDING 3: School Tax Collection Interest earned on school tax collections has been remitted to the Town instead of the school district. IiiIIl RESPONSE 3: The Town Supervisor spoke to the Wappinger Central School District official (at the request of the Town Tax Collector) about the interest and was told that the Town should put it in their tax collection account since they don't get paid for administering the taxes. We are still looking in previous minutes to find when exactly this took place. .. III .. 30 .. .. .. .. .. .. .. Audit Response page 2 .. FINDING 4: Purchase Order System End-of-year outstanding encumbrances per the accounting system significantly exceeded purchase orders actually open. .. .. RESPONSE 4: There was work planned and it did not materialize. The funds have now been returned to the fund balance of 1999. .. FINDING 5: Fixed Assets The Town did not record any disposals of fixed assets during the year. .. .. RESPONSE 5: It is the Supervisor's and the Comptroller's plan to totally overhaul and reconstruct the fixed asset reports when GASB implements regulations which should take effect later this year. .... .. III .. .. .. - 31