Sunday, May 23, 2010

Lies, Damned Lies and Accounting

Confounded Friends:

Oh dear.

Just when I thought our fabricated financial confusion was begining to stick. Along comes a damnable accountant.

We're found out.

It seems the City Council, last year before our current financial 'crisis', decided to hire an outside accountant to analyze the City's books. To finally get to the bottom of Moyer's City finances. Aldermen Arnett and Israel's idea we were told.

Be careful what you ask for, because now you got it boys.

In this case the news, delivered to Finance Committee Chair Classie Hoyle by Council Auditor Robert J. Pellicoro, that there is no crisis.

See the email below:

Sent:Tue, May 18, 2010 8:09:42 AM
Subject:Re: Fw: Annapolis finances


The term "deficit" is not appropriate when defining the current fiscal status for the City. The Mayor's Proposed FY 2011 Budget is balanced for each Fund and estimates an $11.2 million combined Fund Balance as at June 30, 2011. This equates to 14% of the combined FY 2011 estimated operating budgets, well above the City Code requirement of 5%.

Excluding the Water and Sewer Funds, even though the Code does not, results in a Mayor's Proposed FY 2011 combined Fund Balance of $4.7 million or 6.9% of the combined FY 2011 estimated operating budgets, again complying with the Code requirement. The Code also states that an additional 5% shall not be expended without the approval of the Finance Committee. To achieve a 10% combined Fund Balance, as early as June 30, 2011, would require a $2.1 million reduction in FY 2011 Proposed expenditures.

The Mayor's Proposed FY 2011 budget for the General Fund assumes $2.4 million savings from salary and benefits concessions from City employees. If no concessions are made, an additional $2.4 million in cuts to FY 2011 budget expenditures would be required. I believe the status of these deliberations are not yet final.

Hence, the City's actions to finalize the FY 2011 Budget would first require reductions to make up any shortfall resulting from concessions of less than the $2,4 million included in the Mayor's Proposed FY 2011 Budgets. Then, the City, which is in compliance with the 5% Code requirement, can adopt a plan to restore the combined Fund balance to 10%, without adhering to the significant reductions in expenditures presently before the Council.

The " old reserve " , which is the combined Fund Balances of the General Fund and the eight Enterprise Funds at some point in time, was $16.3 million as at June 30, 2009. This has declined to a Projected June 30, 2011 balance of $11.2 million. The bulk of the decline, by Fund, are : Transportation Fund - down $1.5 million; General Fund - down $1.8 million; and Water Fund - down $1.3 million.

With regard to credit ratings, a Fund Balance is one of the several factors that are considered in determining ratings.



So there it is. A $2.4 million shortfall - and only if the unions don't fill the gap. And addding to the reserves is not mandatory now. And the City Charter is not being violated.

Damn you CPAs. I hope you are happy.

How will we hide our naked political agenda to shut down city government now?

Young Mayor Cohen will undoubtedly hear of this and, perhaps, take action to back off CAO Doug Smith's firing binge. And Alderman Arnett and his 'expert' minions are shown to have no clothes at all. Not a pretty sight. And Finance Director Tim Elliott may actually have to answer the Council's questions and stop lying to the Mayor. OMG.

Don't panic. Think, damn it, think.

Maybe we still have time to cook up some other crisis. The Capital and Josh Stewart will flog it. Taliban on West Street. Or Martians on City Dock.

Of course. Foer. Get Foer in here! He'll gleefully lie about anything to back stop us.

I beg you. Throw me a bone here or we're all going to get busted.

I hate it when well paid actors don't stay on script.

King of George


  1. Lied to again by Arnett et al.

    Typical. That guy would try to lie himself out of any corner.

  2. These are complicated and bothersome matters. I do hate being misled by my Solicitors and the Chancellor of the Excheqeur. You can't trust the politicians of course just look what they have done with the Euro.

    Perhaps we need an Independent Forensic Auditor to come and clean up this financial oil spill. I really don't know whom to trust anymore since the old man passed on...

  3. More lies from Arnett.

  4. What is the truth ?

    Please don't say it's complicated.

  5. I do not understand .

  6. The Eastport 'we hate our lives' group showed up last night. Ranted and raved.

    And lied.

  7. Surely the numbers are not being fudged...

  8. Josh Cohen a King. MRE is out for his head.

  9. I read we are 8 million dollars in debt yearly and an Alderman said 13 mil was what was really needed for rainy days.

    What's the truth ?

    Why don't we just give our charter over to AACO? They will be more efficient given their size and our taxes will be lower. We used to be Ann Arrundell Towne anyway.

    What's the difference ?