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The Granite Shoals City Council is looking for an outside analyst to take a closer look at the city’s fiscal year 2023-24 budget due to a lack of confidence in the numbers. The council tabled a vote on the proposed budget after a public hearing Tuesday, Aug. 29. 

Councilors then decided to hold a special meeting at 6:30 p.m. Friday, Sept. 1, at City Hall, 2221 N. Phillips Ranch Road, to vote on hiring a budget consultant to sort through the city’s funds.

The council had been reviewing the city’s budget for several days leading up to the public hearing but was ultimately uncomfortable with the fund balances and how the city’s finances were tracked over the past year. Granite Shoals has a deadline of Sept. 29 to approve its budget in accordance with Texas law. 

Tuesday’s meeting did result in unanimous approval of a new tax rate of $0.508 per $100 property valuation, the lowest in at least 10 years.

“This budget has morphed into 73 pages — it goes into great detail — but as the saying goes, ‘the devil is in the details,’ and there is some question about reconciliation of some of the fund balances and transfers,” said Place 4 Councilor Steve Hougen during the budget hearing. “I think that when we have a consultant, it will improve this and make it an immaculate budget for next year.”

The council will discuss and possibly take action on the specifics of bringing in a consultant during Friday’s special meeting. “Reconciliation” is an accounting term that simply means comparing transactions and activity within a fund to supporting documentation in an effort to ensure complete accuracy. The council’s concerns center on a lack of regular reconciliation of Granite Shoals’ funds over the past year.

“The fund balances have not been reconciled in over a year,” Place 2 Councilor Kevin Flack told after the meeting. “My question to (City Manager Peggy Smith) is: How do we know the fund balances being reflected are accurate? I could be wrong, but, out of an abundance of caution, we’d like to get another set of eyes on (the budget).”

Flack explained that without regular reconciliation of city funds, he did not feel comfortable moving forward with the budget until it had been looked over by an outside consultant. The council voiced its agreement through a unanimous vote to table the budget and set Friday’s special meeting.

The budget has been handled by Smith, per her role as city manager, but she said a year of tumultuous activity in the city and a lack of staff might have obstructed typical budgeting practices.

“Over the last year, we have been very short-handed,” she told “We kept the doors open and money coming in. We had to set our priorities on what we completed and what we finished. I believe (the council) feels that there are some financial background items that they would be more comfortable knowing to make a decision about a budget.”

The short-handedness to which Smith referred is not unwarranted. Former City Manager Jeff Looney was fired in June 2022, and Smith was made interim city manager, a position in which she remained until she was officially hired as full-time city manager in March 2023. The city’s finance director also quit in June 2022 and was not replaced until earlier this August when Cari Casey was hired as financial services manager. Granite Shoals continues to operate without an assistant city manager.

Flack acknowledged city staff issues, noting Smith had been wearing the hats of city manager, assistant city manager, and finance director since June 2022. asked Smith if she felt confident in the city’s current budget.

“I welcome anybody to look at (the budget), and if they can find an error, I always want us to find our errors within and fix them before we go to the public,” she said. “But I don’t know what (the councilors) are saying are the errors they’re uncomfortable with.”

1 thought on “Granite Shoals council seeks consultant, confidence boost on budget

  1. I appreciate your coverage of Granite Shoals. I have never lived there, but I enjoy your articles about GS. I moved away from the Hill Country two years ago, but I keep my subscription current just to stay current with Granite Shoals. Someday, somebody will produce a movie or write a book about the Saga of GS. It is fun to follow.

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