Auditors say Mackinac County is in good financial shape and ended 2007 in the black, however, they caution commissioners that tougher days may be ahead as limitations on revenue growth are likely, owing to a number of factors. The county ended 2007 with a general fund balance of $3,305,740, up $918,191 over the 2006 general fund ending balance of $2,387,549.

County Commissioners adopted the 2007 audit report at their Thursday, June 19 meeting. The report was presented by accountant Ken Talsma of Anderson, Tackman and Company.

Increasing heath care costs and rising liability insurance rates, along with a cap on the growth rate under the Headlee Amendment, and the reluctance of voters to approve a tax increase, say auditors, will continue to impact the county's financial picture. Further state and federal cuts, predict auditors, are likely. Auditors suggested commissioners keep this in mind when planning next year's budget.

In 2007, auditors reported a drop in revenue for the county, which did not receive $109,960 in federal revenues that were budgeted.

"Having the highest unemployment rate in the United States also impacts the county's economic future," states the report.

According to the U.S. Department of Labor, Michigan had the highest seasonally adjusted unemployment rate in the country, at 8.5%, for May.

In April, Mackinac County had a 15.3% unemployment rate, Jay Caldwell, Mackinac County coordinator of Michigan Works! in St. Ignace told The St. Ignace News. May and June numbers, he said, which have not been released, will be an important indicator on how the county is doing. Typically, for those months, he said, the county's unemployment rate is approximately 5%, as seasonal tourismrelated jobs become available.

Business foreclosures, said Mr. Caldwell, have reduced the number of jobs available in the county, although the limited number of foreign workers able to obtain a work visa this year has helped make more jobs available to local workers.

"I haven't seen as many locals looking for jobs," he said, "as I would."

Right now, he said, the construction work is "way down" in the county and he continues to see workers filing for unemployment benefits.

"The unfortunate part of Mackinac County," said Mr. Caldwell, "is we have no manufacturing."

Auditors also suggest the board establish three new policies. Commissioners, said Mr. Talsma, should adopt a fraud policy, which would address suspected fraud, fraud, and actions to be taken by the board.

Also, state law requires an electronic banking policy. The policy would state the type of transactions that would be made electronically and who would be allowed to activate an electronic transaction.

A check cashing policy should be adopted, said Mr. Talsma, that would clarify if the county would cash checks using its petty cash, and if the board agrees to allow the process, a limit should be set.

Based on advice from the state, the treasurer's office already has established a policy not to cash anyone's check, said Treasurer Nora Massey, who attended the meeting.

Commissioners did not set a time to begin working on the policy.