AUBURN - City leaders have three years to make changes before the sewer fund hits a deficit and to prevent the water fund from continuing to drown in debt.

Auburn City Council listened to a recount of an audit of the budget season that ended in June 2006 by Ciaschi, Dietershagen, Little, Mickelson & Co. during the Thursday meeting.

While the audit concentrated on the quality of record-keeping, representative Patrick Jordan reviewed the status of the city's seven funds: general, water, sewer, special grants, capital, hydro-electric and solid waste funds.

“The water and sewer funds are concerns. They're continuing to lose money and they should be addressed,” Comptroller Lisa Green said.

The end of the 2006 budget season left nearly $950,000 in the sewer fund balance, down from $1.3 million in 2005, and $2 million in 2004. The water fund, however, showed a deficit of more than $66,000. The account has lost money since 2004.

“We've been wrestling with those two funds continuously,” Councilor David Dempsey said. “We know what we're up against.”

Jordan said the sewer account is “going in the right direction,” but still has not turned a profit.

Revenues will not maintain the sewer fund enough to keep it in the black, Green said. She predicted it has three years before it runs out.

Green predicted the water fund will break even because of the water rate increase that went into affect in July.

“We'll have to have another water increase if you want to show a profit,” she told councilors.

Green served as acting interim city manager because a family emergency caused Interim City Manager Michael Long to be absent.

Mayor Timothy Lattimore said he would call for more information detailing where unaccounted water goes in the system, how much a gallon of water costs to process, and how to spread out the cost of infrastructure maintenance to all water customers before he would consider raising rates.

“We need to get to the bottom of this Watergate. Why are we losing 1.6 billion gallons of water a year,” Lattimore asked.

The council tabled a resolution to create a task force to examine the efficiency of the water treatment and distribution system in favor of having a workshop with relevant employees.

Councilors Matt Smith and Dempsey attended a meeting last week with the town of Owasco.

They agreed on user fees that would be passed on to the water customers.

Smith likened the proposed $4 fee to the price of one or two jugs of purified water.

“Everyone is going to take part, everyone is going to pay, not just the city,” Smith said

In other news:

€ Corporation counsel plans to release the name of the candidate for city manager next week.

Negotiations are completed and the council aims to vote to hire the out-of-state candidate at Thursday's meeting.

€ Council turned down, 3-1, Auburn Police Chief Gary Giannotta's request for a part-time keyboard specialist.

The position was omitted from last year's budget but Giannotta said the department has gotten too far behind in paperwork to continue without the clerk.

Smith asked if another city employee could help the department catch up the records it needs to turn into the state. Giannotta said the department is seven months behind turning in reports to the government, and that could affect the department's ability to seek grants.

Councilor Thomas McNabb, Smith and Lattimore turned down the request in the name of saving the $12,000 expense, and Dempsey offered the lone supporting vote.

Councilor William Graney was absent from the meeting.

Staff writer Jessica Soule can be reached at 253-5311, ext 267 or jessica.soule@lee.net