Is Derby in the Red?
The amount of money in the City of Derby’s Fund Balance – commonly referred to as the Rainy Day Fund – has been a hot topic for the past couple of years.
When the current administration took office five short years ago, the Fund Balance contained approximately $5 million dollars.
While the current administration continues to be elusive on the amount of taxpayer dollars in the Fund Balance, it now appears to be in the negative.
In October 2009, the Democratic Party disputed the amount within the Fund Balance, only to be left in the cold without any justifiable answer from those in office. The only answer that was ever received was from former Tax Board Chairwoman Carolyn Duhaime, who said it’s all still in the Fund Balance.
Finance Director Henry Domurad backed Duhaime’s claim by saying, “it’s all accounted for.”
As of June 30, 2008, audited financials revealed the Fund Balance was at $3,343,922, which is approximately $1.7 million less than the estimated balance when the current administration took office. (Documents are posted at the end of his commentary)
Where did $1.7 million go?
Exactly one year later on June 30, 2009, updated audited financials revealed the Fund Balance was exactly $1,528,421. This is only four months after Duhaime and Domurad claimed the money to be intact, which means there should have been approximately $3.3 million at the time of their statements.
However, independent, outside auditors indicated the Fund Balance lost another $1.8 million from the previous year. Where did that additional $1.8 million go and how could the Tax Board Chairwoman and Finance Director calculate so inaccurately?
At this point, it appears that approximately $3.5 million has been removed from the Fund Balance since taking office.
On Tuesday, June 15, 2010, amidst a gathering of Derby taxpayers at St. Jude’s Church, Mayor Staffieri, in response to a question on the amount of money in the city’s Fund Balance, said, “I don’t know, maybe $3 million?”
When the Fund Balance was approximately $1.5 million on June 30, 2009, Mayor Staffieri claimed the Fund Balance to be in the range of $3 million, which would have
meant the Fund Balance had actually increased by approximately $1.5 million since the June 30, 2009 audited financials were released.
Based on the above audited figures, that is clearly not the case.
To compound the City’s financial woes, when the Board of Aldermen voted on October 22, 2009 to settle the lawsuit with Ceruzzi over the seemingly flawed contract for the Downtown Redevelopment project, another $1.75 million was taken from the Fund Balance to pay for the settlement.
The Aldermen’s decision to settle with Ceruzzi was justified and correct, however, it appears Derby’s coffers contained less than was owed to Ceruzzi.
If the Fund Balance was $1,528,421 as of June 30, 2009 and the Board of Aldermen agreed to pay Ceruzzi $1.75 million on October 22, 2009, then it appears the City of Derby’s Fund Balance is in the red by approximately $220,000.
The audited financials for June 30, 2010 have not been released yet. It will likely show an extremely telling tale of the current administration’s tenure in office.
Editor’s Note: Rob Hyder is a lifelong Derby resident. He ran for Third Ward Aldermen in 2009 as a Democrat. The views and opinions expressed here are his own.
Suprised to see that no one has commented on this article yet.
We have been in deep discussions over the last week about derby’s trasfer station and redevelopment. This all adds to that.
If these figures are indeed proven to be true i want to know what explanation the current administration has for the funds being in the red 5 short years later.
Sharpeye,
If the figures deem to be correct where and who spent the other $3.25 million???
If we look at it from your perspective, and we do indeed blame the garofalo administration for the ceruzzi law suit, pelase dont ignore the fact that the other 3.75 million is unaccounted for.
Basicly the only money accounted for that has been documented to come from the fund balance is the 1.75 paid out to ceruzzi.
Sharpeye,
I am not disputing the $1.75 million settlement to Ceruzzi. In fact, if you go back and read my commentary again, I stated, “The Aldermen’s decision to settle with Ceruzzi was justified and correct, however, it appears Derby’s coffers contained less than was owed to Ceruzzi.”
I attended the Board of Aldermen meeting in which this decision to settle with Ceruzzi was made and I encouraged them to vote as they did.
However, I am questioning where the rest of the initial $5 million went. The $1.75 million is accounted for, but what about the other $3.25 million?
Who is going to answer that question? It appears Derby is in the red.
SoxFan,
First, thank you for your lengthy response. However, please allow me to correct you, rather simply.
We agree the General Fund Balance was $1,528,421 as of June 30, 2009. We also agree that on October 22,2009 (nearly 4 months later), $1,750,000 was approved to be allocated for the Ceruzzi settlement.
When you subtract $1.75 million from $1.5 million, you are left in the red by more than $250,000.
The last thing I want is a wild goose chase. However, that is exactly what it is like trying to gather information from this administration. Regardless if I decide to run for office or not, I will continue to bring such issue to light as it affects all taxpayer in the City of Derby, not just myself. I have absolutely nothing to gain.
The June 30, 2010 audit has been completed. Where is it? I stand by my commentary.
Sharpeye,
Man you dont miss anything always quick to call someone out. Since you did quote my post correctly…kudos to you. As for your suggestion of me going to the tax meeting that sounds like a great idea. i know im not going to get any concrete answers from this panel about exactly where this money went or the current balance of the fund balance, unless the town accountant or mayor staffieri himself were to comment on the page. So in fully understand to get all the answers i would need to attend the meeting. Thanks for pointing out the obvious as you are so good at.
Can someone please show me where Rob Hyder asked for a federal case to be opened? Its been mentioned a bunch of times not really sure why it keeps being said. Sure he went the route of putting his view out in public. For those of you who condemn him for making “too big of a deal” of this in your eyes. i applaud him that he had the guts to put this out in the open tio the public and attatch his name to it.
The real shame is those who attack him for writing this article.
Sharpeye we have been over the fact of hiding behind a ususer-name If you dont attack peoples points of view then your comments very well should stay anonymous. But if you attakc someones chcharacters well as their intentions then i dont think you should be able to hide behind your username. I am prprettyure you have said this before.
i apologize for the spelling errors and the dificulty to follow my comments. i dont enjoy this spell checker they give you here. Ill just not trust it anymore
Sharpeye:
Very Well put and i do appreciate YOUR OPINION.
The fact of 11 days from now is warranted of course if we have waited months since the question first arose then what is another measley 11 days. I agree.
The fact that it took a newspaper article to get an answer is the real issue now. The article made Mr. Hughes tell The Tax payers of derby that the duns balance will be discussed on the 18th. Without this correspondence the question may have remained unaswered. Once again i thank everyone for the healthy debate. i will now stop milking this dry. On to the next one!!!