Budget » The Newburgh Advocate

NYS Comptroller audits city budget

Yesterday, March 24, the New York State Comptroller’s Office (OSC) issued their audit of the City of Newburgh’s 2010 budget. The audit is available to download from the OSC’s website.

In response, today the city issued the following press release:

Acting City Manager Richard F. Herbek Responds

To State Comptroller’s Press Release on City’s 2010 Audit

In response to a press release on the City’s 2010 audit issued by State Comptroller Thomas DiNapoli on March 24, Acting City Manager Richard F. Herbek commented, “It is important to note that the City of Newburgh requested this audit in order to get as clear a picture as possible of the City’s financial status. I requested the audit on behalf of the City Council in the fall at a meeting with Mr. DiNapoli’s office that Senator William Larkin and Assemblyman Frank Skartados helped to arrange. I very much appreciate their assistance in setting this process in motion, as well as the assistance of Mr. DiNapoli’s office.”

In the last several months, Mr. Herbek’s efforts have been focused on gaining clarity on the many financial challenges facing the City, and obtaining expert assistance to address them, in the absence of a Comptroller. Council approved hiring financial consultants Michael Genito and Dwight Hadley to help review the City’s finances, and recently extended Mr. Hadley’s contract so he can continue to assist new Comptroller Christine Mitchell.

Some of the budget issues that came to light were overestimated revenues, including payment in lieu of taxes, appropriation of an unsubstantiated fund balance for expenditures, and underestimated debt service payments.

The current financial crisis is “the City’s number one priority,” he said. “We know that 2010 and 2011 will continue to present cash flow issues, and along with Council, the City Comptroller, and Mr. Hadley, we will continue to carefully review expenditures and revenues.” The City’s outside auditors have completed the 2008 audit, and will soon begin working on the 2009 audit, which should give a clearer picture of the City’s finances, he said.

He added, “The City will begin work on the 2011 budget shortly, and is also taking steps to institute deficit financing. We will be working constantly to achieve a structurally balanced 2011 budget.”

3.4.10: financial update, CROs, Dr. Blue, & loan program

Video excerpts from the city council work session Thursday, March 4, 2010.

The work session began with a grave report on the city’s financial status, given by Dwight Hadley, CPA, and assisted by Christine Mitchell, CPA, the city’s new comptroller:

Next came a presentation by Dr. Jerome Blue on the status of the Liberty Street School project:

The third presentation was regarding the Community Resource Officers, or CROs. Representing the Newburgh Enlarged City School District were Ralph Pizzo and Mike Pacella. The school district has offered to pay the city for two new police officers in exchange for staffing Newburgh Free Academy and North Junior High School with a CRO each. Also assisting with the discussion were two former CROs, who spoke of the benefits of the positions, and FBI agent Maryann Goldman, who spoke about the seriousness of Newburgh’s gang problems (as reported in the cover story of the Times Herald-Record) and urged the council to fund the positions.

Full video of the entire CROs discussion here:

Finally, from later in the work session, discussion on the Home Improvement Loan Program.

[video deleted]

This program is administered by Demetrius Faulk. Courtney Kain, Acting Director of the Planning Department, explained the program with Demetrius. It was during discussion of this program that (at 6:15 on the video) Councilwoman Marge Bell notes that the records show her as the recipient of a $13,500 loan. Bell says she did receive some funding, but she says she did not receive $13,500.

The loan originator is listed as the Newburgh Community Development Agency (NCDA), which corporation counsel Bernis Nelson recommended dissolving earlier in the work session.

It’s not clear where all the money is going

On Monday, November 16, the Newburgh City Council held a special meeting that included a public hearing regarding two bond resolutions. As reported elsewhere, those bond resolutions were passed after a heated discussion between the council, bond advisers, and the public. Also under discussion was whether to enact a financial advisory board; in the end language was added to the resolutions to create one. “It’s not clear where all the money is going,” Ken Bond, Newburgh’s bond counsel, said. Thus, he explained, having such a financial advisory board would reassure potential investors that there would be oversight.