By Kyle Stewart
Following-up on our coverage of July 29th’s emergency City Council meeting, The Annapolis Sound has attempted to contact the eight current alderpersons to find out if the Mayor has made good on his assurance that they would be provided with a detailed accounting of how the City’s first $10 million line of credit was spent. If you recall, the City Council passed Mayor Cohen’s plan to amend the City Charter to allow for a potential extension of its line of credit to $16 million by a vote of 5-to-4* in a move to stave off an unforeseen cash flow problem.
One of the major concerns shared by several of the Council members during that grueling, nearly 4-hour meeting was that they simply did not have the information necessary to make the decision before them. Mayor Cohen, as recently as this week’s video update, has admitted as much – calling the meeting “the low watermark of this administration.” But as of this afternoon, the City has still not provided the Council or the people of Annapolis with the hard numbers detailing the spending that necessitated nearly doubling its credit line to avoid an operational shutdown.
Seven of the eight sitting alderpersons (Ald. Pfeiffer of Ward 7 was unable to be reached) said that they had received no accounting from the administration as of yet. Alderwoman Classie Hoyle (Ward 3) noted that acting city manager Mike Mallinoff informed the Council during Monday’s closed-door session at City Hall that they would “be getting that [information] soon.”
Taking into account that City finance director Tim Elliot has been out of town this past week, it is still perplexing that it is taking the Cohen administration so long to be able to produce data showing how the initial $10 million dollars were managed (or mismanaged). If the adage “those who refuse to learn from history are doomed to repeat it” has any value, why isn’t the Mayor hell-bent on figuring out how he found himself in this situation? And following the democratic process, if Mayor Cohen (for whatever reason) is not committed to figuring out where these $10 million of the taxpayers’ money went, why aren’t the people of Annapolis calling their alderpersons to demand an answer?
*Voting Record for CHARTER AMENDMENT NO. CA-07-10: Yeas – Mayor Cohen, Alderwomen Finlayson, Hoyle, Aldermen Kirby, Pfeiffer
Nays – Aldermen Arnett, Israel, Paone, Silverman
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The $10 million line of credit was drawn in the following increments over the course of two months: $3 million on May 26; $4 million on June 23; and $3 million on July 28. These amounts were deposited into the City’s checking account at Bank of America. All payments are made out of this account.
The LOC was used for payroll, paying vendor bills, insurance bills and debt service, and purchasing supplies. Money drawn from the LOC was co-mingled with other City funds collected – such as utility payments, recreation fees, parking fees and permit fees – during this period. So while we know what the City’s expenses have been over those two months, it’s difficult to identify which expense was paid with the LOC and which was paid with other funds.
For the presentation to the City Council on July 29, Finance Director Tim Elliott broke down the City’s revenues and expenses between May and July 27 – the period in which the LOC was drawn and spent.
Expenses are broken down into three broad categories:
Cash paid to non-employees, i.e., electricity, phone service, other vendors
Cash paid to personnel, i.e., payroll and insurance
Debt service payments, i.e., bond and lease payments
Cash received: May-July 27
LOC Overall
May $3,000,000 –> $6,592,974
June $4,000,000 –> $9,195,738
July $3,000,000 –> $6,760,033
Total $10,000,000 –> $22,548,745
Expenses: May-July 27
Cash paid to non-employees: $6,143,311
Cash paid to personnel: $14,506,902
Debt service payments: $1,752,107
Total $22,402,320
Phill McGowan
Public Information Officer
City of Annapolis