NATCHEZ, La. — The Village of Natchez ended the 2024-25 fiscal year with more than $1 million in new capital investment and a dramatically improved net position, but auditors flagged recurring operational losses, multiple compliance violations and a warning that the small Natchitoches Parish community may struggle to meet its financial obligations in the years ahead.
The annual financial report, prepared by Rozier, McKay & Willis CPAs of Alexandria and covering the year ended June 30, 2025, shows the village’s total net position rising to $3.35 million from $2.34 million the previous year — a gain of more than $1 million. But auditors attached an emphasis-of-matter notice to the report, cautioning that the village “has suffered recurring losses from operations” and that doubt exists about its ability to meet future obligations.
The village received $988,373 in federal Coronavirus State and Local Fiscal Recovery Funds during the fiscal year, channeled through the Louisiana Division of Administration’s Office of Community Development. Nearly $900,000 of that went toward sewer system improvements, while $88,530 funded construction of a new Town Hall. Those one-time infusions drove the net position gain and masked what auditors described as ongoing structural financial weakness.
Stripping out grant revenues, the village’s sewer enterprise fund posted an operating loss of $75,501 for the year. Sewer charges for services generated $66,847 against $144,895 in operating expenses — meaning the fund recovers less than half its operating costs from ratepayers before depreciation adjustments.
The village levied 3.68 mills in property taxes, collected $63,732 in sales taxes at a 1% rate and brought in $26,227 in franchise taxes during the fiscal year. Total general fund revenues reached $280,454 against expenditures of $240,803, leaving a year-end fund balance of $41,119 — up from $16,329 at the start of the year.
Four findings, three unresolved from prior year
Auditors issued four formal findings against the village, three of which carried over unresolved from the prior year’s audit.
The most serious, classified as a material weakness in internal control, involves inadequate segregation of accounting duties. Village management acknowledged the deficiency but cited limited staff size as the reason it cannot be corrected. The finding has persisted since at least the 2023-24 fiscal year.
A second finding faulted the village for failing to maintain records sufficient to reconcile its meter deposit liability — money held on behalf of sewer customers — to individual account balances. A third finding cited violations of the Louisiana Government Budget Act, which prohibits unfavorable budget variances exceeding 5% of overall revenues or expenditures without a budget amendment. The village’s actual expenditures exceeded its budgeted amounts without triggering the required amendment.
The fourth finding, also carried over from the prior year, found the village was not properly remitting fines, fees and court costs collected on behalf of the state and other entities. Auditors noted that village management was unaware of which amounts were required to be remitted — a condition they called potentially violative of Louisiana Revised Statutes. Village management pledged in its corrective action plan to ensure future compliance.
The Statewide Agreed-Upon Procedures report, also completed by Rozier, McKay & Willis, identified additional deficiencies, including the absence of written policies governing budgeting, purchasing, disbursements, payroll, ethics and other standard municipal functions. No documentation of required annual ethics training or sexual harassment training was available for review. The required fraud notice under R.S. 24:523.1 was not posted on village premises.
Board accountability gaps
Meeting minutes reviewed by auditors did not include references to budget-to-actual comparisons or other financial information as required. Auditors also found no evidence that the board had received written updates on the status of prior-year audit findings, a standard requirement under Government Auditing Standards. Village management committed to begin including that information at monthly meetings.
Outlook and management’s plan
Mayor Patsy Ward Hoover, who received $5,550 in compensation and $206 in reimbursements during the fiscal year, leads a governing board that also includes Aldermen Monique Sarpy, Shelia Johnson and McKindley Hoover, each of whom received $2,550 in per diem payments.
The village carries no long-term debt. Capital assets at year-end totaled $3.28 million, including a sewer system valued at $4.44 million before accumulated depreciation of $1.57 million. The village held $80,784 in cash across its governmental and enterprise funds at June 30, 2025, fully secured by federal deposit insurance.
Management’s plan to achieve financial sustainability rests on three pillars: steadily increasing sewer rates, reducing operating expenditures once the current sewer improvement project reaches completion, and increasing fines and forfeitures collected from offenders. Auditors noted that management expressed confidence those measures would allow the village to continue as a going concern, while stopping short of endorsing that assessment.
The village is incorporated under the Lawrason Act and provides police protection, general administrative services and sewer service to its residents.
Source: Village of Natchez Annual Financial Report, fiscal year ended June 30, 2025, Rozier, McKay & Willis, CPAs, Alexandria, Louisiana.