Moorhead receives national honor for financial management

Nancy Edmonds Hanson

It was not exactly a surprise when Moorhead received the news from the Government Financial Officers Association last month, but it was welcome: The city’s finance division had won the national group’s Financial Certificate of Achievement.
Again. Because the city has earned the award from the professional group of public financial executives before.
Forty times before.
Moorhead city manager Dan Mahli heralded the award at the Feb. 13 city council meeting. “This recognition from the GFOA is good news for Moorhead,” he announced. “It demonstrates the highest standard of professionalism, work ethic and leadership in the delivery of full and open finances. We’re grateful for our finance team and confident in their commitment to public service and accountability to taxpayers and ratepayers in Moorhead.”
“It’s a huge, unbelievable achievement,” says Jenica Flanagan, who has headed the city’s finance division since 2021. “It’s a testament to those who have come before us. They set the standard very, very high. We’re just taking the baton from them and going forward.”
While its role is critical to Moorhead’s operations, the people who manage the city’s money are rarely in the spotlight. Programs and services rightly garner the lion’s share of attention. Behind the scenes, the eight people on Flanagan’s staff keep the wheels of government turning. They are responsible for overseeing all activity involving the city’s money, coming in and going out.
Among their responsibilities are the developing the city’s operating and capital budget, financial planning, accounting and financial reporting, treasury and risk management. The city council has final authority for adopting the city’s annual budget and establishing the property tax levy. (Property taxes are collected by Clay County on behalf of the city.)
The national recognition is based upon review of Moorhead’s annual comprehensive financial reports, focusing on the 2022 document.
The director gives credit for the latest of the four-decade string of top awards to two members she calls “amazing financial managers”: Ann Henne, who oversees what Flanagan calls “the juice” of receivables, payables and payroll; and Megan Zahradka, who manages the budget and rigorous financial reporting required of public entities. Rounding out the staff are an accountant, three technicians in accounting and payroll, and a part-time assistant.
Their focus differs, she explains, from the work of accountants who deal with business and personal financial matters. “Fund accounting is a specialized niche,” she notes. “We track a number of different funds, with a separate checkbook for each.” In other words, fees collected under the banner of wastewater, storm water, forestry, street lights, mass transit and the rest are sequestered and used specifically for each of those purposes.
Flanagan and her staff develop the city budget that’s ultimately submitted to the Moorhead City Council late each year. “We work with every department for at least nine months to put together the numbers,” she says.
The city budget represents a massive amount of research and collaboration. In December, the council approved the numbers submitted for 2024 totaling $135 million, an increase of $28 million over 2023. She points out that taxpayers won’t be picking up the bill for all of that figure; the largest part of that increase relates to the impending 11th Street underpass project, which will be largely underwritten by state and federal funds. Taxpayers will see an increase of only 3.3%.
The city uses municipal bonds when financing for infrastructure and improvements must be spread out over a period of years. That’s when exceptional financial reporting pays dividends, according to city manager Dan Mahli. In September, Moody’s Investors Services – the top national risk assessment firm – raised Moorhead’s rating a full notch, from Aa3 to Aa2. Moorhead Public Service’s rating was also raised to the same level. Moody cited “a very strong financial position, a growing local economy that serves as a regional economic hub and moderate long-term liabilities and fixed costs.”
He credits that in part for excellent interest rates negotiated in past months. The upgrade means savings to taxpayers and a safer investment for bond buyers interested in Moorhead.
The city sold $16 million in new bonds in September to finance 2023 infrastructure improvement projects. The winning bid’s interest rate was 3.9%, substantially lower than what was generally seen at that time. The estimated interest cost savings on the new bonds attributed to the rating upgrade is more than $180,000 on this bond issuance alone.
More recently, issuance of $28 million in public utility revenue bonds for 2024, again with a term of 20 years, was secured at 3.5%.
Achieving excellent rates on financing is undeniably good. Flanagan says, though, that her favorite part of her position in the finance division is its variety. “We get to collaborate with so many people on the widest possible variety of projects,” she explains. “People don’t think of accounting as a people field, but in this position, it truly is.”

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