HOULTON – Once again, the town has been declared in “good financial condition” by its municipal auditing firm.

During a recent Town Council meeting, the group accepted the 2006 annual audit after hearing an overview of the findings in the document.

Ron Smith, a representative from RHR Smith & Co. of Buxton, presented councilors with the audit during the meeting.

Smith has been delivering the update to councilors for the past several years, and again told councilors that he found the town to be in sound fiscal shape.

“You returned money to the taxpayers,” he noted, speaking of the money that the town took out of its surplus fund last year to lower the mill rate. “You had favorable revenues for the town … You are very fiscally responsible here.”

Smith added that as of Dec. 31, 2006, the town had $1.2 million in its surplus account.

For the past several years, councilors have been able to take money from the municipality’s surplus account to offset taxation and lower or hold the mill rate.

Smith speculated that the town would again be able to use some of its savings to offset taxation.

One recommendation that Smith did have, however, was that the town consider adopting a fund balance policy.

The amount of money that the town holds in its surplus fund usually generates significant discussion among board members each year.

Some have argued that the figure is too lofty and have advocated for more money to be used to lower the mill rate. Others have maintained that the surplus money provides a needed financial cushion for the town.

Smith has told councilors that their past practice of having approximately $1 million in surplus makes good fiscal sense.

He said during the meeting that having a fund balance policy would help establish guidelines to help town officials decide how much to keep in surplus.

Councilor Paul Romanelli said that he was happy with the results of the financial review.

“I think the taxpayers are going to be happy when they see that we have money to give back to them,” he noted.