FY 2017 - 2018 Audit

Economic Factors

The City of Spencer continues to see a strong local economy through the receipt of local option sales taxes, local hotel/motel tax receipts, the number of recent inquiries regarding business location and development and the number of new businesses coming to town. In recent years, the City's local option sales tax receipts have been slowly declining; however, the FY18 true-up payment that the City received in November 2018 was approximately 70% more than the FY17 true-up payment. This may signal an increase in local retail sales. The State Legislature also passed legislation in the 2018 legislative session that will begin to tax online sales beginning in January 2019. Housing continues to play an important part in the City's economic development program. There are several employers in the general area of Spencer in strong hiring patterns which may entice these employees to remain in the community. Business inquiries remain strong for those wanting to move or expend in the Spencer area. The City also saw a new 69 unit market rate apartment complex open in early FY18. The growth seen in the tax base is key in allowing the City to continue to offer the level of services our citizens have come to expect. The City continues to monitor the State's financial condition as it is closely tied to the antiCipated backfill of the commercial/industrial tax rollback program that was implemented several years ago. In the coming years, the City will have to monitor how the implementation of the multi– residential property tax rollback affects the revenues generated for the City. These rollbacks do not have state revenue backfilling the losses, and any substantial decrease due to multi-residential property may have an impact on future budgets. The City of Spencer has always been financially conservative, as is demonstrated in our available fund balances, debt ratio, and user fees and will continue to do so in the future. In doing so, five-year revenue and expense projections are prepared for each of our major enterprise funds; and we model our debt service levy for the next ten years to show when additional debt can be issued without having an impact to the taxpayers.

Contacting the City's Financial Management

This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City's finances and to show the City's accountability for the money it receives. If you have any questions about this report or need additional financial information, contact the Finance Officer at the office of the City Clerk at 712-580-7200.

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