Archive for March, 2014

Last Saturday I attended a “strategic planning retreat” of DeKalb City Council, department heads and a couple others. Here’s a slideshow of the agendas, planning guide and timeline. Read the rest of this entry

**Update, noonish: Just picked this up on Twitter: IL Rep. Tom Demmer (R-Dixon) is sponsoring legislation to help prevent thefts of local government funds. One of the key provisions includes auditors’ sharing copies of the management letters with the governing bodies of counties and municipalities.**

Recently I became aware that each annual financial audit includes an auditor’s “letter to management” with comments and recommendations. As far as I know, such letters are not published (perhaps due to inclusion of deficiencies that some would find embarrassing) but a citizen can obtain them via Freedom of Information Act requests and I did.

This piece of the FY2013 letter caught my attention:

 photo AuditorsLettersOverBudget_zps70d364e4.jpg

“Excess of actual expenditures over budget” to the tune of $3.1 million is pretty major, especially for a town that supposedly is striving to meet a target to hold the equivalent of 25% of its General Fund balance in reserve.

Why isn’t the overspending big news? When it comes to the General Fund, the city enjoyed revenues that exceeded projections for the year — enough to cover the excess spending and a bit more. I guess the philosophy is, if you don’t end up with an actual deficit in your GF, it doesn’t matter what you spend.

Other funds, such as Equipment and Fleet, aren’t so easy to explain. For example, Equipment had excess expenditures of $512,680 according to the letter, yet total expenditures as shown in FY2013 estimates (which are part of the FY2014 budget) are only $259,310. Fleet has a similar story. Did someone OK last-minute spending sprees that didn’t make it into the FY2013 budget estimates? What should we make of this?

Now We’re Getting Somewhere

Turns out, City of DeKalb’s press release this week about hiring outside help has a backstory, and the Daily Chronicle has unearthed it..

New DeKalb City Manager Anne Marie Gaura wants the city to hire an outside financial expert after staff recently broke rules for making purchases in excess of $20,000.

First, the council approved the changes to city hall that included moving the finance office to the first floor and upgrading security. When city staff sought council approval, $14,000 in work had been completed, but the project was slated to cost $36,000. During their last meeting, aldermen approved a $22,864 expenditure for fitness equipment at the police station that had already been purchased using administrative tow funds.

“This just goes to the long history of the organization,” Gaura said. “It wasn’t anything intentional, but it indicated to me we need to improve our purchasing policies.”

Wow, dig it. The new city manager is saying it’s not OK to come to council for authorization to exceed the $20,000 spending authority after the fact. Think about what that might mean for fiscal discipline and accountability in DeKalb if the city manager is a stickler for the rules.

I Have More Questions than Ever

Out of the blue, City of DeKalb has announced a Fiscal Responsibility Initiative.

Mayor John Rey said the initiative was made to strengthen financial transparency and accountability.
“Through the initiative we hope to move in a positive fashion toward financial stability,” Rey said.

I thought the city already was the role model for transparency, accountability and financial stability? Huh.

The article also says the city will bring in more experts from outside to accomplish these things. That sticks in my craw because we already have a $50,000+ report from outside consultants sitting on the shelf.

— If you want to strengthen transparency, my dear CoD, un-redact and release the full strategic planning report by the financial consultants, not just the parts that make you feel good about yourselves.

— If you are concerned about financial stability, put the strategic planning report and the Financial Advisory Committee together, as I called for the other day.

— If you value accountability, clean house. It’s the perfect accompaniment to the fresh, new city manager we are all so hopeful about.

At any rate, we shouldn’t pay for more outside help without good reasons and the ones given in the article are too vague to support. Try again.

First, let’s update our pension percentage-funded chart with the FY2013 numbers. These are from Comprehensive Annual Financial Reports (CAFRs).

City of DeKalb is quick to tout its balanced budgets and its growing “reserves.” But if DeKalb is doing so well, why isn’t it making up the pension-funding ground it lost during the past two recessions? Read the rest of this entry