Two Million Dollar Accounting Error Timeline

Early in last year’s Mayoral and Council campaign I reported that the groundbreaking for the Century Theater was a hoax designed to solidify the incumbents’ effort to obtain re-election. It was; and it worked. Now it is time for me to expose another example of campaign deceit: The two million dollar accounting error.
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My sources for the following information comes from 1) Council members, 2) Article in the Sentinel dated March 2nd, 3) Letter in the Sentinel written by Finance Director, Brent Worthington dated March 16th, 4) The audio tape of the Council meeting held on February 2nd. The meeting of February 2nd is important because the members of the Council first learned of the error at that time even though the staff knew that a problem existed seven months earlier. (July/August) I will rely on the tape and power point presentation from that meeting heavily.
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1) In July 2005 the Finance Director noticed that the sales tax revenues were not following the pattern experienced in prior years. He claimed on February 2nd that he had mentioned it to the Finance committee in either July or August. He did not know the cause of the problem at that time.
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2) In October 2005 a new member of the finance staff determined that the new tax approved by the voters in November 2001 was not properly being allocated. The Finance Director informed the former City Manager who in turn informed the Mayor. A decision was made not to let the information out to anyone during the campaign; including “certain” members of the City Council.
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3) From mid-October until the City Auditor arrived in January of this year no action was taken by the Mayor, City Manager or City staff. Even though the cause, nature and effect of the $2,000,000 error were known, those in the know would not divulge the information to our elected Council.
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4) In January the Auditor agreed with the information presented to them and the release of the information to the Council was scheduled for February 2nd.
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At the meeting, the Finance Director was interrupted while presenting his power point presentation by a very surprised Mayor Pro-Tem and Finance Committee Chairman, Rick Lindsey. Rick asked why the Council had only been told about the error seven months late. He immediately received the following response from the City Manager, “We wanted to make absolutely sure that all the totals and figures and we also wanted to follow up with the auditors as to, if in fact there was an error, why they didn't catch it. wanted to make the totals viable for you." (Note: There is no claim that anyone on the Council had been told.)
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Immediately after the Manager’s statement, the Finance Director stated that he had a very good recollection that he mentioned the problem to the Finance Committee in July or August. He also admitted that the situation was not even an agenda item for the committee. Since this claim had been made in the Sentinel article and in Brent’s letter to the Sentinel, I’m going to make a guess as to what might have happened. Assuming that Brent had only determined that the sales tax was out of whack, I would not be surprised if he had said to the committee something like this as the committee adjourned. “I’ve noticed that something is not right in the sales tax compared to prior years but I’ll be checking it out and will get back to you.” This is only my guess. It might have happened, but it is contrary to the recollection of Rick Lindsey and I do know that he was completely surprised on February 2nd. Either way, the error when discovered, was kept secret and neither the Mayor nor any other member of the Council had anything to say during the meeting that might shed some light on the timeline.
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I cannot think of any legitimate reason our elected representatives were not informed of the error, in detail, last October.
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In the March 2nd issue of the Sentinel Mayor Novak commented on how she would like to use the “found” two million dollars in the General Fund, “This infusion of cash will help the Council get to its priorities faster.” I have a better idea. PAY BACK THE WATER FUND! Evidently, she has already forgotten the results of the November Charter Amendment that you overwhelmingly approved.