CullmanTimes.com, Cullman, Alabama

Local News

December 29, 2008

Whitley disputes deficit

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By Patrick McCreless

staff writer

Former Hanceville Mayor Katie Whitley has a problem with the council’s recent announcement that the city has a $1 million deficit.

“There is no deficit at the city of Hanceville,” Whitley said. “There may not be the money there that they (council) want, but there is no deficit.”

Certified Public Accountant Larry Cooke’s audit of Hanceville’s last fiscal year indicates otherwise.

“I don’t know which year she (Whitley) is looking at,” Cooke said. “Last (fiscal) year, the general fund, which pays the bills, operated at a deficit of over a $1 million.”

Hanceville’s last fiscal year lasted from Oct. 1, 2007 to Sept. 30, 2008.

Cooke said when the previous Hanceville City Council took control in 2004, the city had approximately $1.5 million in cash and receivables in the bank. When the administration left, there was $969,000 less, Cooke said.

He added that the council spent $600,000 just in the last fiscal year, much of which was on projects for the city’s parks. The largest expenditure was $300,000 for a concession stand at C.W. Day Park. Another $100,000 was paid to engineering firms on projects to map the city’s sewer system and map the city, Cooke said.

Former council member Hubert Jones agreed with Whitley’s assessment of the city’s financial situation.

Jones said according to the city’s books, Hanceville had $685,434 in the general fund as of Oct. 31.

“That’s what was there, Friday before the new administration started,” Jones said. “We haven’t had any deficit.”

Cooke noted the general fund money has all gone to pay off the last administration’s debts, such as the concession stand construction.

“According to the books, nothing was paid on it (concession stand) at the end of the last fiscal year,” Cooke said. “It all comes out of the revenue of the current administration.”

Whitley claimed the current administration made up the deficit to justify the reinstatement of a 3 percent tax on the Cullman Electric Cooperative.

“He’s (Mayor Kenneth Nail) just putting a scare tactic on to pass the tax,” Whitley said.

The tax, which the council is currently considering, would generate an estimated $150,000 a year for the city. However, the Co-op would likely pass that cost onto it’s Hanceville customers.

The previous Hanceville council removed the tax in August to lower citizens’ electricity bills.

“Nobody wants to raise anything,” Nail said. “I’ve had several sleepless nights thinking about it.”

Nail said he and the council have already tightened the 2009 budget as much as possible. But even with the major cost-cutting, without the tax revenue, the city will be approximately $138,000 in debt during the coming year.

“We have three options: we can deplete what little bit of resources we have and be broke, we can lay off the majority of the city workers or we can pass the Co-op tax,” Nail said.

The city council will hold a special called meeting at 6 p.m. Wednesday to discuss the Co-op tax and the 2009 budget. Nail said Cooke would make a powerpoint presentation on the budget and what was spent during the last fiscal year.

“If you (public) have any ideas of where else to cut spending, please come,” Nail said. “This mess has been dumped in our laps and we’ve got to deal with it.”

‰ Patrick McCreless can be contacted by e-mail at patrickm@cullmantimes.com or by telephone at 734-2131 ext. 270.

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