Fort Smith receives ‘clean’ audit opinion on 2024 financial reporting

The City of Fort Smith received a “clean” audit opinion of its 2024 financial statements from Springfield, Mo.-based Forvis Mazars. The city had a “net position” of $1.069 billion in the 2024 report, up 5.4% compared with 2023.

In a letter dated June 30, Forvis Mazars auditors noted that the city’s financial statements “present fairly, in all material respects, the respective financial position” of all the various funds and operations of the city.

The city’s net position, a comprehensive look at all city revenue, expenses, assets, liabilities and other accounting measures, rose by $54.5 million in 2024. Within the total net position of $1.069 billion, $909 million was tied to investments in capital assets, and $53.9 million was “available for meeting the City’s emergency and unexpected obligation,” according to the report.

Fort Smith’s net position is up 49.4% in the past 10 years since 2015, when the tally was $715.508 million.

“Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating,” the report noted.

The report also provided insight into the city’s key sources of general fund revenue.
• Sales tax revenue (all sources)
2024: $83.525 million
2023: $84.495 million
2015: $56.85 million

• Property tax revenue
2024: $14.551 million
2023: $14.252 million
2015: $11.641 million

• Franchise fee revenue
2024: $8.063 million
2023: $9.326 million
2015: $6.388 million

Revenue from water and sewer system charges totaled $63.642 million, up from $56.714 million in 2023. Revenue from solid waste treatment services was $21.424 million in 2024, below the $22.207 million in 2023.

Following are other items in the 2024 audit report.
• The final amended general fund budget had total appropriations of $81.4 million – total expenditures plus transfers out. The general fund is the primary operating fund for the city.

• Total general fund revenue, including transfers in, was $61.6 million which was consistent with the final budget estimates, which was just below the revenue estimate of $62.9 million.

• Total general fund expenditures, including transfers out, was $8.3 million less than final budget primarily due to the timing of planned capital expenditures.

• Revenue from sales taxes was down 1.1% in 2024. “The decrease in revenues is attributed to consumer reduction on discretionary spending and a decline in building construction resulting in decreased sales and use tax in the City and the County in 2024 compared to 2023,” according to the report.

• The city’s total bonded indebtedness was down $7.5 million in 2024 to $177.3 million.

• The value of land owned by the city increased $8.5 million in 2024. Property acquisition during the year included land for parks and drainage, land from a federal grant assisted flood-prone property buyout program, a maintenance facility, and a second police precinct.