By ELI LUTGENS
Publisher/Editor
The 2020 Financial Statement Audit report by the accounting firm Abdo Eick and Meyers (AEM) was presented during the regular meeting of the New Richland City Council on August 23, 2021.
2020 Audit Report
Layne Kockelman from the accounting firm AEM presented the audit report, and noted he’s been working with AEM, and the city of New Richland on its audits each of the past ten years. Lane noted that this type of audit is not looking for fraud, but rather to, “provide opinion that the financial statement and numbers are free of significant error.”
Three area’s the city can do better, and in the opinion of Kockelman, will do better going forward are: time period for payment of invoices; for example, throughout the year, multiple invoices were not paid within the 35 day legal requirement; timely bank reconciliations; and payroll reports and remittances.
“I think some of this will be remedied with Michelle being on board going forward,” Kockelman said. “The turnover was where a lot of these went astray. Anytime there are turnovers (between city administrators), it’s difficult to keep on top of things.”
Recommendations
The accounting firm AEM made four recommendations regarding internal documentation:
1. Develop written policies and procedures.
2. Document employee responsibilities.
3. Document processes.
4. Improve internal control and help with staff turnover.
In an attempt to help accommodate these recommendations and at the request of Mayor Gail Schmidt, the city’s staff and department heads have become much more involved in preparing for the 2022 budget than previous years.
“I think in the next audit you’ll see a big change,” said Mayor Schmidt.
A look at the numbers
Person’s interested in looking at the audit report can do so at city hall. That said, the general fund balances have increased at a similar rate to the annual budget increases. At the end of 2020, the city had, in fund balances, roughly $600,000, which is 55.9% of its general fund budget. AEM recommends between 35-50% in fund balances, whereas the City of New Richland’s policy calls for 50 percent.
The council accepted the 125 page audit report.
NR Care Center
Dave Dunn presented the care center report, reporting that the July census averaged 40 residents, which is the current number of residents in the facility as of August 23, 2021.
Staffing remains a concern. “It’s not better anywhere else in the county,” said Administrator Dunn.
Eight certified nursing assistants (CNA) went back to college, many to nursing school, and the hope is that they will return to work at the facility. “We are struggling just like everywhere else,” Dunn said. “We’re still able to provide good, quality care.”
Administrator Dunn is a CNA and is qualified to work directly with residents, and does so regularly.
Three part time culinary aides were promoted, but there remain multiple openings for CNA positions.
Financials
The July finances look a lot better than June, as the consulting fees continue to decrease now that the facility has a new full-time administrator.
Strategic Planning and Operational Risks
The strategic plan worked on with Advanced Health Institute is moving forward and going well.
One resident tested positive for Covid-19. Dunn said the resident was vaccinated. “Everyone is getting tested. So far everyone has been negative.”
Dunn said the resident received an infusion and is recovering well. They do not know who the resident contracted Covid from, despite doing contact tracing. “It didn’t come from an employee or another resident. They all tested negative. It probably came from a visitor.”
Visitation and activities are currently suspended. The current vaccination rate of residents is 97 percent and over 70 percent for the staff. “That’s high,” Administrator Dunn explained. “There are some facilities that only have 40 percent staff and 60 percent resident.”
Dialogue
Mayor Schmidt asked Terri Hanson from the Care Center advisory board if he had anything he would like to say before the council accepted the report.
Hanson: “The industry as a whole is struggling… The biggest challenge I see is that inflation is taking all our costs up. We’re having to pay overtime and we’re short of people. And we’re not gonna really be able to raise our rates for maybe a year because we can’t. It’s such a delay. It’s just a strain[…] We’re positioned better to make it than most because we have financial reserves. It scares me what’s gonna happen to the industry as a whole. What are we gonna do with people? Facilities are gonna run out of money. The state or somebody has to do something.”
Administrator Dunn: “Biden’s announcement last week doesn’t help either, mandating all nursing home employees to get vaccinated.”
Hanson: “Whether you agree with it or disagree with vaccinating, people are gonna walk. People will walk instead of having a vaccination and then who's gonna take care of the residents? I’m not gonna say I’m for or against. It’s just a fact of life. That’s the way it’s gonna be.”
Administrator Dunn: “The other sad thing that they’re talking about is tying the reimbursement for medicare and medicaid to the vaccination percentage of employees. So it’s a double edged sword.”
Hanson: “I guess my message would be, if you can call your legislator, encourage them to really be careful what they do. Think about the consequences of what they do.”
Mayor Schmidt: “I think that’s the least they can do. Pick up the phone and call.”
Administrator Dunn: “Whatever side of the fence you’re on about the vaccination is one thing. But when you’re tying the reimbursement to the percentages of your staff to get vaccinated, it’s going to be tough.”
Hanson: “Some people won’t get the vaccination. It's going to be tough, especially if people walk.”
Administrator Dunn: “We hired a CNA who was working in Owatonna and they’re mandating their employees to be vaccinated. And there were five of them who left because they will absolutely not get vaccinated. And that’s gonna happen all over the country.”
Continued Dialogue
Immediately following the previous dialogue, Advisor Hanson spoke about the Care Center as a whole, and the opinion of its Board.
Hanson: “We feel very comfortable with Dave and Lindsey being in the building. We keep finding things they do. We’re gonna be patient. We’re gonna get this sorted out. There’s some things from the past that just have to be found and fixed.”
Councilperson Chad Neitzel: “It didn’t happen overnight and it’s not gonna be fixed overnight.”
Mayor Schmidt: “It’s going well then?”
Administrator Dunn: “It’s going very well. It’s a great facility. It’s a great community. A lot of support. I met a lot of family members and residents and it’s just been wonderful.”
Hanson: “We’re down to more financial things now than people things. The building, as far as the staffing and the atmosphere, it’s a good building.”
Mayor Schmidt: “That means a lot right there.”
Upcoming events
The staff/resident picnic for August 26th has been restricted to include only staff and residents and no other persons. This year’s Christmas party will be early, December 12 at 2 p.m. The Armstrong Boulevard Brass Quintet will provide entertainment. Other events planned for the day include: an ugly sweater contest, Santa visiting, and a gift exchange.
The council accepted the Care Center report.
People Service
Michelle Johnson delivered the people service report and reported that 25 blue cards were issued for lack of payments and three shut-offs.
Johnson attended safety training in Iowa and requested a couple updates to bring the water treatment plant up to date regarding OSHA. The requests included annual fire extinguisher inspections, and emergency light batteries. After a long wait, the city has received it’s reimbursement from the insurance payout for the damaged fence.
The Council accepted the People Service Report.
Streets and Water Report
Erik Hendrickson presented the Streets and Water report and said the 3rd Street project has been completed. A new meter reader program has been “ten times better” and has reduced meter reading time for Hendrickson from seven hours to 30 min. The council approved the purchase of the new equipment Hendrdickson had been testing.
The flashing lights on the crosswalk sign on highway 13 has been fixed, after Councilperson Jason Casey’s continued request that the problem be addressed. Also, Xcel energy has started fixing multiple street lights in town after several council members urged Hendrickson to contact them. New tires were approved at the cost of $903 for the city’s 2017 Ford truck. LED lights on the Ford snow plow were approved at the cost of $720. The city is accepting bids until October 1 for new snow removal services. The council accepted the Streets and Water report.
Miscellaneous
The minutes from the August 9 meeting were approved, as well as the July payables.
A purchase requisition form was approved by the council, requiring department leads to code their purchases, so the city can properly file the expenses according to the budget, as well as ensure that all invoices get paid.
A liquor license was approved for Trapper Lanes.
The council held a work session August 30 to help prepare for the public hearing scheduled for September 13, at 6:35, regarding the 2022 budget.
The council adjourned at 8:28 p.m.