Port Richey needs outside auditor to review its finances

The start of the new fiscal year in Port Richey this week should give pause to City Council members and municipal administrators to contemplate past financial performances at City Hall.

More to the point, they should retain an outside auditor for a more thorough review of the city's income and expenses to determine exactly how Port Richey is more than $1.5-million in the red on its utility budget over the past three years, how it managed to fall behind on required audits and whether past city policies allowed split contracts, handshake agreements or no-bid deals as a matter of routine.

Last week, the state auditor general flagged Port Richey as a city in a state of financial emergency after city-retained auditors reported a $147,115 deficit for the year ending Sept. 30, 2007. Though the governor's office will review the city finances, action from Tallahassee is not expected.

It is up to Port Richey to clean up its own mess, and all indications are that is what is happening, with the city poised to invest in its aging utility system and use new software to track and control spending.

It is needed. Here is a sample of the past city disbursements as detailed by City Manager Richard Reade:

• The city rented walkway mats at a cost of $1,000.

• City staff asked Reade to approve of a new three-year agreement to lease heavy construction equipment that was triple the current price. The proposed lease was not put out to competitive bid and the price dropped below the current lease cost after Reade instructed staff members to solicit additional vendors.

• Money obtained from a 2005 utility bond hasn't been spent.

• The city had been paying $100,000 for an outside water plant operator, a cost reduced by $45,000 when the city retained a combined water and wastewater operator.

Much of the city's financial woes are attributed to its Utility Department. Former City Attorney James Mathieu, as interim city manager, discovered discrepancies last year. The city had been losing 11-million gallons of water monthly because of a large water main break under the Pithlachascotee River, an open valve at the city's water plant and leaky pipes that wasted large amounts of the water the city had purchased from neighboring New Port Richey. The monthly water loss is now reported at 32,000 gallons.

Rickety pipes are an indication of a failure to properly invest in capital improvements. But just as disconcerting was the city's inability to produce a map of its water lines because utility service had been handled by a private consultant.

Clearly, retaining a forensic auditor is appropriate. It will help identify improper accounting, purchases and past mistakes to ensure they are not repeated.

A popular conspiracy theory now is that a council majority is seeking to dismantle the city from within. It has made the rounds so much that council member Perry Bean last week addressed the rumors as nonsensical.

Bean's statement, however, failed to highlight one obvious point: The recent audit shows the people who governed Port Richey previously did a pretty good job of running the city into the ground.

Port Richey needs outside auditor to review its finances 09/29/08 [Last modified: Tuesday, September 30, 2008 5:40pm]

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