Perham audit shows healthy finances, strong fiscal management

Perham’s latest audit gave city leaders something rare in local government: a clean financial report that also points to room for the next round of spending decisions. The 2025 audit, presented to the Perham City Council by Amanda Scanson of Brady Martz, showed a healthy general fund, rising utility revenue and lower debt, a combination that suggests the city entered its new budget cycle on solid footing rather than under strain.

At year-end 2025, Perham’s unrestricted general fund balance stood at $1,268,235, equal to 46% of total general fund expenditures. That matters because council records from May 2024 show the city’s own policy calls for a minimum unassigned general fund balance of 35% of the annual budget. In that same 2024 record, the city’s unassigned balance was listed at 55% of expected budget, so the latest audit shows the reserve level has come down from that earlier mark but remains above the city’s floor.

For Perham residents, strong fiscal management is not an abstract accounting phrase. It affects whether the city can keep basic services steady, preserve borrowing capacity for future projects and avoid taking on unnecessary financial risk when it moves on roads, utilities or public facilities. The audit’s healthy balance sheet gives council members more flexibility, but it also sets a clear test for the next major spending choices.

That test was visible in the same June 8 council agenda that included the audit. Alongside possible acceptance of the 2025 audit, the council also had an apparent low bid for the Perham Area Community Center roof project, a one-year health and safety services contract, several donations for city facilities and programs, and acceptance of financial reports including cash balance and investment summary, budget summary, enterprise financials and a utility aging report. Those items show that the council’s attention is already moving from review to execution.

Perham’s public budget-and-audit page reinforces that this is an ongoing financial process, not a one-time checkup. The city posts audit documents for 2024, 2023 and 2022, along with 2026 budget materials, giving residents a continuing look at how revenues, reserves and debt are being managed.

The city describes Perham as a Statutory Plan B city with four council members and a mayor. With that structure in place, the audit’s clean result gives city leaders a stronger base as they weigh facility repairs, utility demands and development-related investments that will shape the next phase of growth in Perham and the surrounding Otter Tail County area.