Accountant Dan McArthur reported Nye County showed an 18 percent increase in property tax collections, thanks to the net proceeds of mining in the last fiscal year, but he warned county commissioners about declining sales tax revenues due to the overall economy this go-round.

The annual fiscal year 2006-2007 audit -- a snapshot of the Nye County financial picture as of June 30, 2007 -- showed property taxes leaped from $16.6 million in the 2005-2006 fiscal year to $19.8 million.

"We've had a significant increase in property tax revenue from '06 to '07. One reason is inside the property taxes is where the net proceeds lies," McArthur said during his annual audit presentation.

The price of gold rose to over $1,000 per ounce, contributing to the increase in net proceeds.

Consolidated tax, which includes sales tax collections, increased from $14.3 million to $15 million. But McArthur predicted there could be upcoming shortfalls of $1 million to $2 million in revenues from sales tax collections.

The Nevada Department of Taxation released a report last month which show taxable sales dropping 13.5 percent in Nye County for the second half of 2007.

Payment equal to taxes the county receives from the U.S. department of Energy for the land value of Yucca Mountain amounted to $11 million last fiscal year, a major, third component of the $77 million in total revenues.

The audit showed that as of last June 30, the county had $8.8 million in a PETT education endowment fund, $13.3 million in a PETT special projects fund and $11.1 million in a PETT capital projects endowment fund.

Interest revenues jumped from $1.9 million to $3.3 million as the federal government increased interest rates last year, McArthur said.

McArthur scolded commissioners again this year about various budget categories in which the county spent more than what was appropriated -- a violation of Nevada Revised Statutes.

That included special revenue funds for the law library, a town of Amargosa Valley community center, the emergency special revenue fund, impact fees, the town of Manhattan capital projects fund and an agricultural extension special projects fund.

The $3 million grant the U.S. Economic Development Administration has asked to be returned is reflected in the audit. McArthur assumed a $325,333 liability in the general fund this year.

For just the general fund, the audit showed $34.3 million in actual revenues, almost $1 million more than the $33.4 million in budget revenues and $3.48 million over fiscal year 2005-2006.

But general fund expenditures jumped $5.6 million from $30.1 million to $35.7 million. McArthur said that's due to a large, one-time expenditure for a Motorola radio system for the sheriff's department, where capital outlays skyrocketed from $46,657 to $3.47 million.

McArthur's management letter, which makes recommendations on improving county financing methods, listed the following:

Ambulance billings are finally being prepared electronically.

A list of capital assets was prepared according to state law.

The county comptroller needs to have monthly reconciliation of capital outlays and accounts payable.

There continue to be unsigned time sheets and some payroll expenses are listed under the budget for service and supplies.

Manhattan water system funds were mistakenly commingled with the general fund but need to be kept separate for U.S. Department of Agriculture requirements.

Two financial positions he recommended are still unfilled.

There should be better control of surplus assets available for auction.

Impact fees paid by developers and through development agreements haven't been accounted for in a timely fashion. The county has a $4.25 million fund balance in the impact fees special revenue fund.

The county should consider storing data in a proper off-site location in case of a natural disaster.

Finance department employees should be cross-trained, as turnover causes problems with a continuity of operations. McArthur noted a number of skilled employees with specialized knowledge are reaching retirement age.

The county public works department should use computer software programs to monitor expenditures on a project by project basis.

There are improvements in grant administration, with an employee assigned to monitor grants, but there are still errors being detected.

There were some errors in the tax rates used to levy property taxes.

Nye County is moving to a paperless system of approving expenditures, but a hierarchy needs to be established to exercise security over this system.

The county overpaid the Nye County School District in property tax collections due to a lack of communication.

Court facility fees were only supposed to be spent on remodeling or constructing a court facility.

The county recorder's technology fund is only supposed to be used on technology.

Nye County Commissioner Peter Liakopoulos indicated he was overwhelmed by the audit presentation. He asked for an advance copy in the future and an opportunity to review the audit with county staff before the annual presentation.

Commissioner Butch Borasky told McArthur, "I would like to have an hour or two with you in the near future to go over some of these items."

"It might be beneficial for us to do that when we have our corrective action done," Assistant County Manager Pam Webster said. She jokingly pulled out a bulletproof vest loaned by the Nye County Sheriff's Office prior to the audit presentation.