The independent audit conducted by certified public accountants Rynkar, Vail & Barrett, LLP was discussed at the Village of Mineola work session on Wednesday.

Russ Vail of the firm noted that the village's General Fund portion of the budget ended the 2002-2003 fiscal year on May 31, 2003 with a $503,209 deficit fund balance. The $503,209 deficit fund balance is comprised of a reserve for encumbrance of $3,195, reserve for workers compensation of $30,138 and an unreserved fund balance of negative $536,542.

The 2002-2003 budget called for $14,715,974 in revenues. However, the village only took in $14,283,047 in revenues. The village expected to have $14,795,170 in expenses during fiscal year 2002-2003. However, actual expenses were $15,339,398.

The village had a fund balance at the start of the 2002-2003 fiscal year of $553,142. The village spent $1,056,351 more than it received in revenues in fiscal year 2002-2003. The $1,056,351 wiped out the positive fund balance of $553,142, leaving the village with a deficit fund balance of $503,209 in its General Fund at the close of the 2002-2003 fiscal year.

Mayor Jack Martins commended the entire board of trustees for taking steps to fill the deficit. While there was a deficit fund balance in the General Fund, there was $806,981 in the Capital Funds reserve. The board voted to transfer $536,634 of that reserve into the General Fund to offset the deficit. In addition, the board agreed on raising parking fees and installing more meters on Jericho Turnpike, Willis Avenue and Mineola Boulevard to bring in additional revenues.

Trustee Linda Fairgrieve with support from Trustee Lou Santosus have proposed a monthly treasurer's report, something that Mayor Martins also feels it is important to have.

"I'd like to focus on moving forward and working to devise a mechanism and devise possible roadblocks along the way where we can assure the public that instances such as this won't happen again," Mayor Martins said.

Mr. Vail recommended that the village's financial reports should be reviewed at least on a monthly basis to compare actual revenues vs. budget projections and actual expenses vs. budget projections looking for any shortfalls in order for the board to make decisions if necessary in order to look for other possible revenue sources or cutting expenses.

The audit outlined a complete breakdown of the village's financial picture including debt that was accrued in recent years. Here is a summary of the village's debt as taken from the audit.

On October 21, 1998, the village authorized the issuance of serial bonds for the purposes of:

* Costs of construction, reconstruction, alteration, renovation or embellishment of public parks, recreation areas and facilities for use in and for the village (ballfield improvements) - $899,000.

* Costs of the construction, reconstruction, resurfacing and widening of various public roads and streets in and for the village - $626,000.

* Costs for the acquisition of new motor vehicles and acquisition and installation of accessory equipment for vehicles for use by various departments in and for the village - $102,000.

* Costs for the acquisition of machinery and equipment and acquisition and installation of accessory equipment for vehicles for use by various departments in and for the village - $145,000.

* Costs for the upgrade, acquisition, and installation of a computer assisted integrated financial management and accounting system, which is year 2000 compliant for use by various departments in and for the village - $227,000.

* Costs of construction, reconstruction and rehabilitation of sanitary sewer system - $355,000.

At a special village election on October 20, 1998, voters approved the authorization of the issuance of $3,994,000 serial bonds to finance the construction, reconstruction, improvement, renovation and rehabilitation of the Mineola Memorial Library.

On November 17, 1999, the village board authorized the issuance of serial bonds for the purposes of:

* Costs of the construction, reconstruction, alteration, renovation or improvement of public parks, recreation areas and facilities for use in and for the village (ballfield improvements) - $363,000.

* Costs of the improvement of drinking water Well #7 in and for the village - $1,700,000.

* Costs of various water department projects in and for the village - $705,000.

* Costs of the purchase and installation of parking meters for use in and for the village - $210,000.

On January 5, 2000 and March 22, 2000, the village board authorized the issuance of serial bonds in the amounts of $1,716,000 and $2,380,000 to finance the cost of the construction, reconstruction, improvement, renovation and rehabilitation of various fire department municipal buildings in and for the village.

On August 22, 2001, the board approved the issuance of serial bonds for the purposes of:

* Improvement of Memorial Park as a recreation improvement by the installation of new lavatories - $135,000.

* Construction, reconstruction, improvement, renovation and rehabilitation of Mineola Library - $677,000.

* Replacement and rehabilitation of sanitary sewers and drainage system at Elm Place and Jefferson Avenue - $250,000.

* Construction of and additions to, reconstruction, improvement, renovation and rehabilitation of various fire department municipal buildings and premises - $567,000.

* Improvement of Village Water Wells 1, 5 and 7 - $350,000.

* Additional costs of the upgrade of the Water Storage Tank - $236,000.

On September 5, 2001, the village board approved the issuance of serial bonds to finance the costs of:

* Acquisition of two new firefighting vehicles (Pumpers) - $985,000.

* Removal, disposal, acquisition and installation of liquid fuel storage tanks at various locations - $260,000.

On August 21, 2002, the village board approved to finance certain vehicles and equipment in the amount of $325,000.

On October 16, 2002, the village board authorized the issuance of serial bonds for the purposes of:

* Costs of the acquisition and installation of new chemical transfer containment systems at Wells 1, 4, 5 and 6 - $230,000.

* Costs of the improvement, construction, renovations and rehabilitation of Wells 5 and 3 - $140,000.

* Additional costs of the acquisition of two new firefighting vehicles (Pumpers) and various firefighting vehicles (Pumpers) and various firefighting equipment - $145,000.

* Costs of the upgrade to the security systems - $80,000.

* Costs of the acquisition of a new sanitation truck - $130,100.

* Costs of the acquisition of new passenger motor vehicles - $128,900.

As of May 31, 2003 (the end of fiscal year 2002-2003), the village has borrowed Bond Anticipation Notes in the amount of $10,225,300 as a temporary means of financing capital projects.

On February 17, 1998, the village sold $4,895,000 public improvement serial bonds at an interest rate of 4.5099 percent. The bonds are dated February 15, 1998, bear interest payable semiannually on January 1 and July 1 of each year until maturity, commencing on July 1, 1998 and will serially mature on January 1 of each year through January 1, 2016.

On March 26, 1998, the village entered into a project financing and loan agreement with the New York State Environmental Facilities Corporation, which sold State Revolving Fund Revenue bonds, of which the village was approved for $445,161 of par amount of bonds. The true interest cost rate was 4.9674667 percent. The bonds are dated March 15, 1998, bear interest payable semiannually on January 15 and July 15 of each year until maturity, commencing on July 15, 1998 and will serially mature on July 15 of each year through July 15, 2018.

On July 15, 1998, the village sold $4,430,000 public improvement serial bonds at a true interest rate of 4.6008053. The bonds are dated July 15, 1998 and bear interest payable semi-annually on January 15 and July 15 of each year until maturity, commencing on July 15, 1998 and will serially mature on July 15 of each year.

On August 15, 1998, the village board resolved to authorize acceptance of a loan for $65,000 payable over 10 years at a fixed rate of 2.5 percent interest per annum. The loan is from the New York State Department of State Emergency Services Revolving Loan Program and will be for the benefit of the Mineola Volunteer Ambulance Corps. The corps and/or the village will provide matching funds for a new ambulance.

On July 22, 1999, the village sold $330,000 public improvement serial bonds at a true interest rate of 5.255621 percent. The bonds will be dated July 15, 1999, will bear interest payable semiannually on January15 and July 15 of each year until maturity, commencing on July 15, 2000 and will serially mature on July 15 of each year.

At May 31, 2003 (the end of fiscal year 2002-2003), the total outstanding bond indebtedness of the village aggregated $12,075,907.

On Wednesday, Jan. 28 at 6:30 p.m., the village board will meet with businesses of Mineola at village hall to discuss any and all problems.