By Ashley McLeod, staff writer
Nov 30, 2015, 13:38
COLONIAL HEIGHTS — After 10 years of auditing issues within the treasurer’s office, the Colonial Heights City Council held a vote during a special meeting Nov. 17 to approve a resolution that will allow for changes to the city charter, which council hopes will fix years of financial inconsistencies.
The proposed charter change will change some financial responsibilities from one office to another. The treasurer’s office is in charge of all levies, taxes, and assessments on both the city and state level. If the resolution is enacted, the city charter will change all local responsibilities from the treasurer’s office to the department of finance.
“This charter change does not abolish the position of city treasurer, instead it leaves state duties only for the treasurer. So the treasurer will be tasked with collecting state levies, taxes, and assessments, but not local taxes, levies, and assessments,” said Hugh Fisher, Colonial Heights city attorney.
The treasurer’s office will still exist, and there will still be a popularly elected treasurer, but they will only handle state financial dealings. The treasurer will also be able to employ staff authorized by the state compensation board when needed.
The possible charter change comes about following years of inaccuracies in the treasurer’s office, which in turn may end up costing the city, and its citizens, a large amount of money due to issues during audits, which decrease bond values. These issues date back many years, and although attempts were made to fix them, the issues have still been showing.
“Going back to as far as 2005, reconciliations and personal property taxes were identified as a problem in the treasurer’s office,” said City Manager Thomas Mattis.
Reconciliation refers to checking sets of records against each other to ensure that the balances of accounts are accurate and that the money being spent is properly recorded in the records. This can be compared to writing a ledger for a checkbook and checking your online banking to make sure all entries are accurate and are the right amounts.
Citizens have complained about paying their personal property taxes, but then receiving notice that the bills have not been paid, even though they were.
In 2007, training was given to the treasurer’s office in order to fix any issues which would show up negative in the audits. When the following year’s audit came around, the inconsistencies were still showing up.
In 2009, in what Mattis called a “self-preservation approach” the finance department became more involved in the reconciliation process, in order to try and eliminate any inconsistencies in records.
For two years the finance department stepped in and assisted the treasurer’s office, and in 2010 and 2011, there were no issues found with any records.
However, after those two years, the problems reappeared. According to Mattis, in one case there was a discrepancy of nearly $200,000 from personal property taxes that went unexplained.
“Due to inconsistencies in reports. there could be a direct financial impact on taxpayers,” said Mattis.
Over the years the city has hired three different external auditors to assess the accounting of the city. All three auditors came back with the same results.
Because the treasurer’s position is an elected position, the council has been unable to take any action on the problem, which is why the change to the charter was proposed.
The change will allow for the collection of city taxes and related businesses to be placed under the finance department, which is under the control of the council. This will ensure that if there are more inconsistencies, the council will be able to take action immediately, most likely sparing the taxpayers’ money in the process.
“It’s a fairly easy, straightforward reorganization of all city finances that will directly be under the guidance of the city manager, the City Council, and in turn, the citizens of Colonial Heights,” said Mattis.
With the change, the City Council will have more control over the finances of the city and will be able to step in if there are any problems, which they are not able to do now. For years, citizens have complained to council members about problems with their bills, but the council was not able to do anything about it.
“I’ve often had citizens come to me with problems, but because the treasurer’s office is a constitutional office, City Council had no authority so there was very little we could do to help our citizens,” said newly elected council member Betsy Luck. Luck was on council previously when the issues first began.
“I think that’s why we’re really here. With this change we could be able to help citizens and address the problems with our staff,” said Luck.
The issue was also discussed in 2013, but the proposal for the charter change was not approved.
Some may call this move a grab for power, as City Council will be indirectly in charge of the department, but Mattis pointed out that certain duties from the treasurer’s office have already been switched to the finance department.
“The people in the finance department have been working in addition to their responsibilities to supplement and help with fixing things in the treasurer’s office in addition to their other jobs,” said Councilman Joe Green. “Taking this in allows them to now efficiently organize who’s doing what. It’s a work grab for the benefit of our citizens to keep our taxes low so that we can continue to make improvements.”
Another change in the charter will address the position of treasurer. Currently, there is no requirement for who can or cannot be treasurer. This means that anyone, experienced or not in the field, can run for the position.
“If you were a business owner, and you had a $74 million dollar budget, would you take that to a non-accountant, or somebody who doesn’t have a finance record? That is the potential risk that we face every day,” said Mayor Kochuba.
“It is imperative that all finance operations and control of city funds, city tax dollars, be performed by professionals that are answerable to the City Council,” said Mattis.
The charter will also call for a special election in 2016 for the treasurer position. On Monday, Nov. 9, the city council received a letter of resignation from the current treasurer, Joy Moore, effective on Dec. 13, 2015.
A call to Moore’s office for comment was not returned.
The resolution was approved 5-0 with Kenneth Frenier absent and John Piotrowski abstaining from voting due to a conflict of interest.
With the approval of the resolution, the council will now send a copy to the legislative representatives of the area, who will then propose it as a bill at the Virginia General Assembly. If approved, the bill will allow the council to enact the changes in code provisions. State law requires that any change to a city charter must be approved or disapproved by the General Assembly.
