The Robert Bobb Group, a consulting firm hired to straighten out the city of Petersburg’s finances, has outlined a five-year plan to keep the city on the fiscal straight and narrow. Among the 15 recommendations is creation of a Financial Advisory Board tasked to make monthly reports on the budget and ensure that financial policies and procedures are being followed, reports the Progress-Index.
The board, comprised of individuals credentialed in finance and accounting, along with a newly created position of Internal Auditor, would give City Council independent insight into what’s happening in city government.
The Bobb Group report also recommended selling the city water system’s excess water capacity or privatizing the utility entirely, and disposing of parcels of city-owned real estate properties, including the Petersburg Hotel and the old Ramada Inn. Converting those properties to cash would help rebuild the city’s fund balance, which currently stands at negative $7.7 million.
The city, which experienced a $12 million budget gap last year and faced $19 million in unpaid bills, narrowly averted a default on its debt. The Bobb Group, which assumed extraordinary budget powers in a $520,000 contract, rescued the city from insolvency. Among other contributions, the firm claims to have identified more than $10 million in savings and avoided costs. But its contract has expired, the consultants are leaving, and City Council and the apparatus of city government are on their own again.
In their parting report, the Bobb Group listed steps that Council “must take” to keep finances on track. The consultants’ report urged the city to “continue to develop solid financial and business policies, practices and procedures.”
Changing the culture of city government will be easier said than done. A recently released forensic audit of city finances found extensive evidence of abuse of city money and resources in the run-up to fiscal disaster. Reports the Progress-Index in a separate article: “Included in these allegations of misconduct are: misappropriations of fuel for city vehicles, falsification of overtime hours, vacation/sick leave abuse, use of city property for personal gain including lawn mowers and vehicles for travel, excessive or lavish gifts from vendors, and questionable hiring practices.”
“The perception that employees had was that the ethical tone had not been good for quite some time,” said chief auditor John Hanson. “The culture led employees to do things they might not otherwise do.”