Few clear answers for Rutland financial situation

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(Host) There’s plenty of finger pointing but few clear cut answers when it comes to understanding Rutland City’s troubled financial situation.

Recent audits have criticized antiquated record keeping and the lack of adequate checks and balances.

Rising taxes and ballooning deficits have local residents worried.

And there are different opinions as to whether the deficit is recent or has occurred over many years.

VPR’s Nina Keck reports that past and current treasurers are steering clear of any blame.

(Keck) According to City treasurer Wendy Wilton Rutland faces a deficit of just under five million dollars. That’s a lot of money for a city with a budget of 24 million dollars.

Part of the problem may stem from the fact that for years, the city has been transferring money from its enterprise funds – those are typically the money makers for the city – the water, sewer and parking funds – and using that money to bolster the general fund to help pay for services. Concerns have been raised that blending those funds over the years has made it difficult to accurately track how city money has been spent.

But former treasurer Ron Graves, who worked for the city for more than 30 years, disagrees. He says these types of transfers are perfectly legitimate as long as certain protocols are followed and as long as there’s enough money to cover them.

(Graves) "From 1987 to 1999 the transfers out of those enterprise funds to the general fund on an annual basis – it was up to about $300,000 a year. It was a common practice, there’s no voodoo economics. It’s allocating attributable costs within say my department that was attributable was money taken from the water, sewer and parking funds. Those transfers were in the budget every single year."

(Keck) Graves insists that the city of Rutland had never incurred a deficit in its general fund until 2003 – shortly before he left office.

Current Treasurer Wendy Wilton says that’s when problems at city hall started snowballing. She describes it as a sort of perfect storm.

When treasurer Ron Graves retired in 2004 he was replaced by William Shortle – Shortle stayed in office only 9 months at which point Al Wilkinson – then a member of the board of Aldermen was appointed to the treasurer’s job by the mayor.

Wilkinson was voted out of office this past March when Wendy Wilton won the job. So there have been a lot of changes in leadership and personnel – and Wendy Wilton says that’s taken a big toll on the city.

(Wilton) "And I can tell you from reading the audits that I have three audits in my possession that are extremely critical of the city’s operation and they are 2004, 2005 and 2006."

(Keck) Wilton says financial transactions during the last few years were not well documented and recommendations by independent auditors as to how to improve things were not being made.

At the same time, she says the city began taking more and more money out of the enterprise funds without raising water and sewer rates accordingly.

(Wilton) "It may not have been a year or two of lack of oversight. But I can tell you that in a financial office, when things aren’t kept up, even for a few months time, things can become chaos rapidly. And I see the evidence every day because I’m sitting here in the treasurer’s office. And I see the book keeping mess that it became very quickly through all the transitions."

(Keck) Wilton lays a lot of the blame with her predecessor Al Wilkinson. Wilkinson wouldn’t go on the record with VPR. But there is a hint of his position in the Board of Aldermen minutes from November and December of 2005.

That’s just weeks after he started as treasurer. Wilkinson recommended that the board approve a tax anticipation note, which indicates he foresaw a shortfall in city funds even then of over $3 million.

City officials say the current deficit has grown because the city has been overspending its general fund and many key fixed costs have been underreported or not reported at all in recent budgets.

Wilton herself is a former Rutland alderwoman – once elected to office in the mid 1990s and later appointed by the mayor to fill a vacant seat. She came to office with experience in banking and small business administration.

She says her office is taking steps to implement recommendations of a state audit completed in 2006.

Money has been set aside she says to modernize office software and better train the staff.

For VPR news, I’m Nina Keck in Rutland.

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