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Village of Penn Yan Financial Report Analysis
(Management Version)

Fiscal Year Ending May 31, 2025

A structured review of the Village's management-prepared financial statements (FY 2024–2025)

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Village of Penn Yan — Annual Financial Report (AFR)

Fiscal Year Ending May 31, 2025

The Village of Penn Yan's Annual Financial Report (AFR) is the official financial filing submitted to the New York State Office of the State Comptroller (OSC). It presents the Village's finances in a standardized format required by New York State.

While the independently audited financial statements confirm that the numbers are fairly presented under accounting rules, the AFR focuses on how the Village actually operated during the fiscal year — including revenues collected, expenses paid, fund balances, and debt outstanding.

For the fiscal year ending May 31, 2025, the AFR confirms:

  • The Village maintained a positive General Fund balance
  • Total General Fund balance was approximately $5.68 million
  • Unassigned General Fund balance (the most flexible operating reserve) was approximately $3.03 million
  • The Capital Projects Fund reported a deficit position related to ongoing project financing
  • Utility funds (electric, water, sewer) continue to represent a significant share of the Village's financial activity and infrastructure exposure

What This Means in Plain English

The AFR shows that Penn Yan is not operating in a current-year deficit and maintains operating reserves.

However, it also shows:

  • Active capital spending and financing
  • Ongoing debt and retirement-related obligations
  • Heavy reliance on infrastructure assets as the backbone of financial position
  • Utility systems playing a central role in overall fiscal stability

The AFR is especially useful because it allows residents to see:

  • Whether revenues are keeping pace with expenditures
  • Whether reserves are increasing or decreasing
  • Whether debt levels are stable or expanding
  • How the Village's finances compare to other municipalities in New York State

Why the AFR Matters

The AFR is the State's standardized transparency tool. It provides clarity on operating performance — not just accounting net worth.

When viewed alongside:

  • The Independent Audit (verification of accuracy), and
  • The GAAP Financial Statements (accounting structure),

the AFR helps residents understand how the Village is functioning financially year-to-year.

Bottom Line

The AFR supports a picture of operational stability with ongoing capital and infrastructure demands.

The key long-term question is not whether the Village's finances are compliant — they are.

The more important question is whether:

  • Reserves,
  • Revenue growth,
  • Debt levels,
  • And infrastructure replacement planning

remain aligned over the next decade.

Why This Report Matters

The AFR is the State's standardized financial lens. It allows residents to compare Penn Yan to other municipalities, review multi-year trends, and evaluate whether financial stability is improving, holding steady, or tightening.

Used together, the AFR, the audited financial statements, and the independent audit provide a full picture:

  • Verification
  • Accounting structure
  • Operating performance

Each tells a different part of the story.

What This Report Is (And Is Not)

This document is the Village's official financial presentation, including:

Government-wide financial statements
Fund-level financial statements
Capital asset schedules
Long-term debt disclosures
Notes to financial statements
Management Discussion & Analysis (MD&A)

It reflects management's presentation of fiscal condition, prepared under governmental accounting standards and reviewed through independent audit.

This page analyzes the substance of those disclosures.

Government-Wide Financial Position

Total Net Position: approximately $42.3M

This figure represents the Village's overall accounting net worth.

Breakdown:

Governmental Activities

≈ $10.2M

Business-Type Activities (Utilities)

≈ $32.1M

Key Observation

A substantial portion of net position is reported as net investment in capital assets — infrastructure such as electric distribution systems, sewer treatment facilities, water infrastructure, buildings, and equipment. This concentration indicates asset strength, but limited liquidity.

Fund-Level Financial Condition

General Fund

Total Fund Balance

≈ $5.68M

Unassigned Fund Balance

≈ $3.03M

This indicates an operating cushion and near-term budget stability. However, evaluation of sustainability requires multi-year trend analysis, revenue stability review, pension contribution forecasting, and capital transfer requirements.

Capital Projects Fund

Deficit Position

≈ $(856K)

This suggests project expenditures preceding long-term financing and anticipated future borrowing. Capital deficits are common during active infrastructure cycles, but trend direction matters.

Business-Type (Utility) Funds

Utilities represent the majority of Village asset value. They include:

Electric Operations

Water Operations

Sewer Operations

Observations:

Significant infrastructure footprint, moderate long-term debt, and interfund interactions with General Fund. Utility system health directly affects ratepayer exposure, infrastructure replacement cycles, and future borrowing requirements.

Long-Term Obligations

Total Long-Term Liabilities: approximately $17.7M

Includes the following structural obligations that must be serviced over time:

Bonds Payable

State/EFC Loans

Net Pension Liability (ERS/PFRS)

LOSAP Obligations

Compensated Absences

Pension & Actuarial Sensitivity

Pension and actuarial obligations introduce sensitivity to market performance, State contribution rate changes, and demographic trends.

Debt and Financing Structure

The Village utilizes a mix of financing instruments:

Long-Term Bonds

State Revolving Fund Loans

Bond Anticipation Notes (BANs)

Post-Year-End Activity

Post-year-end disclosures show additional BAN issuance for capital needs, including public safety equipment. BANs are common municipal financing tools but increase refinancing exposure if used repeatedly or during elevated interest-rate environments. The trend and maturity structure warrant ongoing monitoring.

Infrastructure Concentration

Net capital assets total approximately $31M+

The Village's financial position is heavily infrastructure-dependent.

Infrastructure assets:

Cannot easily be liquidated
Require ongoing maintenance
Have replacement cycles
Often require future borrowing for upgrades

What This Means

Reported net position is largely non-liquid. The Village's "wealth" is primarily tied up in physical infrastructure rather than cash reserves.

Areas for Continued Monitoring

Factors that will determine long-term fiscal flexibility

Based on the Village's financial report, the following areas merit continued observation:

1

Capital Reserve Adequacy

2

Pension Contribution Volatility

3

BAN Rollover Frequency

4

Utility System Capital Needs

5

Debt Service Trajectory

6

Interfund Transfers and Dependency

Forward-Looking Considerations

The financial report provides a snapshot of current position. It does not answer:

What is the Village's maximum sustainable debt capacity?
What capital expenditures are projected over the next 5–10 years?
How sensitive is the General Fund to economic downturn?
How would significant development or annexation impact infrastructure financing?

Those questions require modeling beyond the annual report.

Conclusion

The Village of Penn Yan's financial statements indicate overall structural stability and compliance with accounting standards.

However, the balance sheet is:

Infrastructure-Heavy

Obligation-Bearing

Moderately Leveraged

The financial report shows where the Village stands today. Future fiscal health will depend on:

Disciplined capital planning
Debt management
Pension funding strategy
Realistic infrastructure forecasting

Explore More Financial Analysis

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Source Documents

This analysis is based exclusively on publicly available financial documents and audited disclosures.