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1. What steps does the city need to take when changing banks so that wire transfers from state agencies can be received in a timely manner?

Most disbursements of state funds to cities are done through the Office of the North Dakota State Treasurer. When a city changes banks, that office should be notified. They will send the city a form to complete and return with information about the new bank account.

2. How often is our city required to have an audit?

The state auditor is required to audit cities and park districts every two years. All political subdivisions, at the option of the local governing body, may be audited by a certified public accountant or licensed public accountant rather than by the state auditor. The audit report must be in the form and content required by the state auditor. The state auditor shall review the audit report to determine if the report is in the required form and has the required content, and if the audit meets generally accepted government accounting standards. The state auditor may charge the political subdivision a fee of up to $80 an hour, but not to exceed $500 per review. A political subdivision may not pay a public accountant for an audit until the state auditor has accepted the audit. However, a political subdivision may make progress payments to the public accountant, retaining 20% until the audit report is accepted by the state auditor.

In lieu of conducting an audit every two years, the state auditor may require annual reports from cities with less than 500 population and park districts with less than $200,000 of annual receipts. (NDCC 54-10-14)

3. What type of investments may a city make?

Cities, park districts, counties, townships and school districts in North Dakota may invest moneys in their general fund or balances in any special or temporary fund in the following types of investments per NDCC 21-06-07:

• Bonds, treasury bills and notes, or other securities that are a direct obligation of, or an obligation insured or guaranteed by, the Treasury of the United States, or its agencies, instrumentalities or organizations created by an act of Congress


• Securities sold under agreements to repurchase written by a financial institution in which the underlying securities for the agreement to repurchase are of a type listed above


• Certificates of deposit fully insured by the federal deposit insurance corporation or by the state


• Obligations of the state


• Certificates of deposit fully insured or guaranteed by the Federal Deposit Insurance Corporation and placed for the benefit of the public depositor by a public depository through an appropriate reciprocal deposit placement service as determined by the commissioner of financial institutions

4. Is it permissible for the city governing body to transfer money out of the municipal utilities fund?

When the city governing board determines that there is a surplus in the municipal utilities fund over and above any amount necessary to provide adequately for the operation and maintenance of the utility, it may transfer from the surplus in the fund to the general fund or to any other fund a total sum of not more than twenty percent of the gross receipts of the municipal utilities for the fiscal year during which the transfer is made. So, for example, if a city had $500,000 in gross receipts to the utility fund for the year, they could transfer twenty percent ($100,000) to the general fund by motion of the governing body provided the utility fund had that much in surplus. A larger amount may be transferred upon resolution of the governing body and approval by the voters at a regular city election. (NDCC 40-30-12)