ALBANY – A state comptroller’s office audit of the Town of Shawangunk sewer charges found its fund balance of $4.4 million as of December 31, 2017 was more than 844 percent of the district’s average annual expenditures.
The sewer district provides services to the hamlet of Wallkill and the two state prisons in the town – the Wallkill Correctional Facility and the Shawangunk Correctional Facility, both of which are operated by the State Department of Corrections and Community Supervision.
The audit found the town did not have a written agreement or basis for rates charged to the state prison system for sewer services and charged sewer district users more than was necessary.
District users, including outside users, paid $2.1 million more than the total expenditures. Charges to the prison system alone exceeded expenditures by $1.4 million.
The comptroller’s auditors recommended the town consult with its town attorney to determine whether a written agreement with the prison system is necessary to clarify rates to be billed and protect district taxpayers.
It also said the town should prepare an analysis to determine the appropriate rates to be charges to users based on annual expenses.
In response to the audit, Town Supervisor John Valk Jr. wrote in an August 2019 letter that “A healthy fund balance is necessary in case of an unexpected malfunction or other emergency requires immediate corrective active action. This is especially necessary when it comes to providing sewage transmission and treatment.”
Of the fund balance, Valk wrote that about $1.3 million will be used to retire the debt of the sewer district. He said the town created a capital reserve fund for the sewer district in 1999 and plans to allocate approximately $500,000 to this reserve fund. Also, Valk said the town has obtained preliminary estimates for needed repairs and upgrades to the system and will need about $470,000 to pay for those necessary items.
