Auditing Salem: What the city's audit and budget show

This series examines the finances of Salem, Utah, a Utah County city, through its own records: audited financial statements, adopted budgets, council minutes and public notices. Each story links the documents behind every figure.

Salem's most recent audited financial report covers the fiscal year that ended June 30, 2025. In a report dated Nov. 26, 2025, the auditing firm Richey May & Co. wrote that the statements "present fairly, in all material respects" the city's financial position. The firm also said it issued a separate report, dated the same day, on internal control and compliance. ^[1]

At a Dec. 10, 2025 council work session, Diana Cannell of Richey May reported that the audit had no findings, according to the minutes, and attributed the result to training and documentation. The council voted 5-0 to accept the audit. ^[2]

Reserves and net position

The city's total net position was $194,707,098 at June 30, 2025. ^[1]

The general fund, the city's main operating fund, ended fiscal 2025 with a total fund balance of $11,013,033, of which $1,705,676 was unassigned. The audit's management discussion says the general fund's unreserved balance ended at seven percent of general fund revenue. All governmental funds together held $19,911,061. ^[1]

Debt

At June 30, 2025, the city had $46,670,742 in bond principal outstanding: $14,884,000 in governmental bonds and $31,786,742 in bonds of its utility funds. The largest issues were a 2018 sewer revenue bond with $17,132,000 outstanding and a 2023 lease revenue bond with $12,477,000 outstanding. ^[1]

The city also owed $5,562,849 on notes, mostly a $5,409,108 storm water note to the Central Utah Water Conservancy District. Bond and note principal together totaled $52,233,591. That figure excludes future interest. ^[1]

The audit predates the council's April 2026 authorization of up to $45 million in water and sewer revenue and refunding bonds, which another story in this series examines. ^[1]

Who is in the city's books

The audit reports Salem's Municipal Building Authority and Redevelopment Agency as blended component units, meaning their activity is included in the city's own statements. ^[1]

The portions of the audit The Ledger could read did not include separate figures for the Redevelopment Agency. ^[1]

The fiscal 2027 budget

The council voted 5-0 on June 3, 2026 to approve the budget for fiscal 2027, which runs from July 2026 through June 2027. ^[5]

The budget report lists general fund revenue and expenditures of $15,250,390 each. The fiscal 2026 general fund budget was $23,661,453; it included a $4,939,000 UDOT Canal Road Trail project revenue line and a $4,760,000 project expense line, neither of which appears in the fiscal 2027 budget. ^[3]

The city's public notice on transfers and administrative fees lists a total approved budget for fiscal 2027 of $45,728,635 across all funds. ^[4]

On June 17, 2026, the council voted 5-0 to adopt a 2026 property tax rate of 0.001129. At the same meeting, the council approved the city's 2026 fraud risk assessment; Finance Director Jeff Nielson said the city earned 335 points, which "puts our fraud risk level as Low." That assessment is the city's own, not an audit. ^[6]

On Nov. 3, 2026, Salem voters will decide whether to impose a 0.1% sales tax for 10 years for recreational, park and cultural facilities and organizations. ^[7]