ROCKLAND, Maine — Rockland city government’s budget surplus grew over the past year but remains less than the policy goal of the council.
City councilors met Monday night with auditor James Wadman of Ellsworth to review the audit for the year ending June 30, 2014.
The surplus grew by $120,000 from 2013, reaching slightly more than $1.2 million.
This amounts to a little more than 6 percent of the $18 million the city spends on municipal, county and school costs. The council approved a policy more than a decade ago to have its surplus be no less than 8 percent.
City Manager James Chaousis said most municipalities want that amount to be in the 12 to 15 percent range. Rockland’s surplus during the past several years have ranged from a low of $407,000 in 2006 to a high of $1.3 million in 2012.
Finance Director Tom Luttrell said that a surplus is maintained so that a municipality does not run low on money and have to borrow money through tax anticipation notes, since that would incur interest costs.
The city would need to have a surplus of $1.5 million to reach its 8 percent goal.
The city’s surplus grew from a combination of revenues being greater than budgeted and expenses coming in less than budgeted.
The auditor said the city’s finances were good overall. One deficiency found was that the city did not comply with the federal Davis Bacon Act that requires the city to verify that contractors hired by the city through community development grants pay prevailing wages. The city had no records which showed what wages were being paid to employees of the contractors it hired for various projects.
The finance director said the city now requires those records be maintained for all community development grant projects.