Treasurer says audits behind and state payments held as Inkster reviews FY27 budget

Treasurer Darren Carrington told the Inkster City Council during a special budget study session that the city is behind on audits for fiscal years 2024 and 2025 and is working with consultants to finish pre‑audit work and restore regular financial reporting.

Carrington said turnover in accounting staff and a change in the city’s external auditors left the city with incomplete transaction records that must be reconciled. “We’re behind on a couple of audits,” he said, adding that consultants Manor (which replaced Plante Moran) are working with treasury staff and department personnel to complete documentation. He estimated the city has gathered roughly 85% of the pre‑audit information and hopes to have the FY24 audit completed by late summer, then proceed with FY25, with the dual effort intended to complete both by the end of the year.

The treasurer told councilors the state has placed some payments on hold while audits remain outstanding. “We started experiencing that, within the last several months,” Carrington said, and identified the holds as certain statutory revenue‑sharing payments and Act 51 (gas tax/road roll) funds. He said the state has been “working with us” and that officials indicated completing the FY24 audit should trigger release of those withheld funds.

Because of the uncertainty, city staff included conservative estimates of the revenue‑sharing amounts in the FY27 recommended column for the general fund and said the auditors will advise whether some amounts should be recorded as receivables. Carrington cautioned that revenue sharing and newly created state programs can change by legislative action and are not guaranteed year to year.

Carrington also reviewed the city’s major grants and capital projects. He listed a $2.5 million senior‑wing addition to the recreation center (current balance shown as $2,000,000), a $900,000 capital upgrade package for the recreation center (including a recently completed $500,000 roof), energy‑efficiency grants (~$100,000), the LEAP lead‑service program (funding three positions), a Wheatley Park renovation just under $1 million, cultural center grants (the first awarded in 2022 and a second award staff estimated at about $600,000), and a cybersecurity grant that staff expects to use for technology upgrades and new equipment.

Councilors pressed staff on several points. They asked how many treasury staff members are on duty; Carrington said he and a finance manager (Regina) lead treasury operations and that some positions and functions are shared with the water and sewer department. A councilor asked whether withheld state funds were already included in the revenue projections; Carrington said they were included as estimates and that recognition often depends on how auditors direct the city to present receivables.

On a grant question, a councilor asked about a sidewalk grant. Staff said the city applied but was denied for FY27 and that the administration plans to reapply for FY28. The council discussed options, including seeking other agencies or local financing if the sidewalk program remains unfunded.

Carrington walked through the recommended general‑fund revenues, calling out property taxes, administrative fees, franchise fees, court fines and forfeitures, EMS/ambulance revenues (projected around $1 million annually), and pilot (payment‑in‑lieu) contracts tied to developments such as Cherry Hill and other MSHDA projects. He explained the difference between contractual pilot payments and statutory PILOTs and said contractual payments generally continue unless a contract specifies an end date.

Councilors also asked about departmental expenditures, including council salaries, conference and training line items, the mayor’s office staffing, and the city’s plan to bring payroll processing in‑house using the BS&A payroll module to reduce manual posting. Carrington said the city has split payroll and accounts‑payable functions and plans operational changes to improve accuracy.

Procedural items: the council voted to approve the meeting agenda early in the session; no formal roll‑call tallies for that motion were recorded in the transcript. Councilors agreed to cancel a planned Friday budget meeting due to likely absences and asked staff to circulate alternate dates; Carrington reminded the body the budget must be approved before the fiscal year end.

Next steps: staff will continue audit work with outside consultants, update the monthly reporting once sufficient audit information is available (Carrington said staff expects to resume regular monthly reporting by July 1), and circulate revised budget material and scheduling options for follow‑up sessions.

Quotes used in this report are from the council’s recorded exchange during the special meeting. All attributions are to speakers on the meeting record.