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Independent auditors last week said Elgin’s financial outlook showed signs of improvement in the city’s latest review, despite a still understaffed department.
City Council March 17 heard Elgin’s financial audit boast stronger revenues and fewer fiscal issues in a report from Mike Brooks of BrooksWaston & Co. The city earned the best possible review of its financial statements while also cutting the number of audit findings in half compared to last year, according to the report.
“Overall, the audit went much better this year, and we were able to get it issued much sooner,” Brooks said. “It’s been quite some time since the city was able to get the information to us prior to March, and the staff here did a great job of getting it to us.” Officials said the city is still awaiting results from the state’s investigation into alleged misappropriations of public funds.
THE NUMBERS
The audit found the city’s assets exceeded its debts by nearly $70 million for the year ending Sept. 30, 2025.
Elgin recorded an overall increase of about $11 million in its financial position during the fiscal year, according to Brooks. City revenue totaled $22.2 million, an increase of roughly $3.4 million from the year before.
Much of the growth came from higher property values, increased service fees and additional grants, according to the report.
Governmental expenses totaled $19 million and was reflected by spending across major service areas, including public safety, public works, general government and parks and recreation.
The city ended the year with about $8.7 million in total reserves, including roughly $2.8 million that could be used for emergencies. Though officials said they will continue to push for more.
“We have two months in reserve, and I’d like to get us to the point where we have at least six months,” City Manager Robert Eads said. “I’m proud of our Interim Finance Director Pamela Sanders and her team, and I anticipate working with them to build a strong executive financial team to move us where we need to be.”
The city’s reserve level currently sits at about 17%, which is below the city’s policy target of 25%, a figure Brooks said is “not in a terrible position.”
RECOMMENDATIONS
City officials said some findings are expected to continue into future audits due to staffing limitations, including a technical issue related to auditors preparing the annual report.
“We will always have the internal control finding,” Sanders said. “Until we have staffing at adequate levels with competent staff, we do not have the means to prepare that internally.”
Other recommendations focused on improving oversight of pooled cash accounts, meeting reporting requirements under state investment rules and updating purchasing policies to reflect a recent change in state law.
Eads said the city has already begun addressing several of those issues.
“There’s a little bit more heavy lifting to go, but we’re on the right path that is positive,” Eads said.
According to Eads, the city is now reconciling financial statements on a monthly basis and working to strengthen reserves while continuing to correct past financial issues.
“We have to fix the foundation first and then we’re going to be there as we continue to go forward,” he said.
RANGERS REVIEW
The audit comes as the city remains under investigation by the Texas Rangers following a state probe into alleged violations.
Greg Abbott announced Oct. 30 the state would launch a deeper investigation into the city’s finances.
The investigation remains active, and it is unclear how long it will remain ongoing, according to officials.
Elgin’s full audit report can be found at elgintexas. gov.
