Killeen may be facing financial insolvency.

With less than a month before the City Council must approve a budget, the city finds itself nearly $12 million in the hole, with no consensus on how to get out.

And despite the financial cliff the city is headed toward, some council members insist on spending more money anyway.

Count Mayor Jose Segarra among that group. He cast the tie-breaking votes to approve the purchases of 51 new city vehicles last week, with a $1.47 million price tag.

Voting with Segarra were Councilmen Juan Rivera, Brockley Moore and Jonathan Okray. Opposing the purchase were Councilmen Richard “Dick” Young, Gregory Johnson and Councilwoman Shirley Fleming.

With Councilman Jim Kilpatrick absent, Segarra was put in the position of breaking the tie — and he voted to spend money the city apparently doesn’t have.

Yet, the following day, the mayor said he was comfortable with his vote, saying he didn’t want to see the city “kick the can down the road.”

The problem is, city officials have consistently done just that when it comes to facing the consequences of unbridled spending, bringing the city to its current financial mess.

The council is divided into two camps: One faction sees no problem spending money for big-ticket items and digging into the city’s reserves to cover the shortfall. The other group is trying to cut spending and avoid incurring new debt.

This dynamic became clear when Young, Fleming and Johnson, as well as Okray, voted against purchasing certificates of obligation in order to “reimburse” the city and prop up its reserves. Their objection is that the city would be issuing debt for projects that should have been paid for years ago — a questionable accounting practice.

But the proposed budget had already counted the revenue, so the city is deeper in the red than originally projected.

Still, council members can’t seem to agree on how to proceed with cutting expenses or boosting revenue.

During Tuesday’s five-hour workshop meeting, members spent an inordinate amount of time talking about increasing the price of cemetery plots and hiking golf course fees, as well as saving $80,000 by cutting funding for employee awards. Modest savings in these areas won’t get the city where it needs to go budget-wise.

Meanwhile, the budget process drags on, with both Segarra and Interim City Manager Ann Farris providing little solid direction to a council in disagreement.

At Tuesday’s meeting, Segarra disregarded the comments of residents who expressed concerns about the financial impact of the vehicle purchase. He also dismissed council members’ suggested alternatives to the vehicle spending proposals as being unworkable.

Farris tried to inject herself into a discussion about conducting a forensic audit of the city’s finances — a topic that will be discussed at Tuesday’s workshop meeting.

The interim city manager offered to help decide the audit’s scope and choose a prospective audit committee.

That can’t happen.

As Farris has overseen the finance department for the past three years, she has a vested interest in the audit’s outcome. If she were to be involved in the process, it would lack integrity. Killeen taxpayers need a clear picture of what happened to the city’s finances — without interference from current administration.

That includes Amanda Wallace, the city’s internal auditor, who apparently failed to recognize the city’s financial problems as they developed.

The mayor and at least one council member have cited the cost of a forensic audit as a reason not to authorize one. But considering the budget earmarks more than $1 million for consultants, it’s reasonable to ask, at this point, which is the better investment in the city’s future?

In the long run, Killeen will get better mileage out of an audit than it will from those new vehicles.

Contact Dave Miller at dmiller@kdhnews.com or (254) 501-7543

(5) comments

Eliza

@ As Farris has overseen the finance department for the past three years, she has a vested interest in the audit’s outcome. If she were to be involved in the process, it would lack integrity. Killeen taxpayers need a clear picture of what happened to the city’s finances — without interference from current administration.

timebandid

There really should be no lack of focus for the city council. This budget needs to see cuts that bring spending in line with income. Without moving in this direction, our taxes will increase and so will the appetite of our government services. Like every government entity, their cry is "More, More, More". It takes responsible leadership to discern what is needed and what is little more than fluff. Because Ann Farris has abdicated her responsibilities, as interim City Manager, the council is forced to do her job for her. So let's do it effectively, though it may also be painfully, to get our spending in-line with our current revenue.

Realist10

@Alvin and @OldWoman well said.
"Ann Farris had overseen the finance department for the last three years, she has a vested interest in the audits outcome. If she were involved in the process, it would lack integrity. That includes the city's internal auditor, Amamda Wallace, who apparently failed to recognize the city's financial problems as they developed."

The Killeen taxpayers are tired of the lies and need the truth.

OldWoman
OldWoman

Mayor Segarra is also the man who said on live TV that the most pressing issue with the city are the roads. What a lack of understanding.

The ISSUE with all these nilly-willy council folks is that they have no consequences to bad decisions. What’s the worst that can happen to them? They get either recalled or voted out. Then it;s the fault of the stupid citizen. There is no legal consequence and no personal financial consequence to any decision the make, so why not play roulette with our tax payer money? Please your companions, make them happy, don’t start drama within, let everybody go on their merry way. Someone else can figure out the mess.

Poor leadership seems to be rampant in this world. People have no clue of what they are doing. I would like to commend Council members Gregory Johnson, Dick Young and Shirley Fleming for voting OUR conscience.

The article says “That includes Amanda Wallace, the city’s internal auditor, who apparently failed to recognize the city’s financial problems as they developed.”

Knowing a bit how things work inside the city, I would venture to guess, in Ms. Wallace’s defense, that she may have noticed and tried to report, but may have been directed to rewrite her reports with “a bit less doom and gloom.”

I agree, the audit has to be done from an outside organization, on a higher level and not by someone who is related to SOMEone at the city. Someone who has not been seen eating or drinking with any of the city officials or council members.[rolleyes]

Alvin
Alvin

This is the personal opinion of this writer.
The mayor was comfortable with his vote 'to continue to kick the can down the road instead of doing something constructive', but in essence, 'That's just what he did, he kicked the can down to others' to be the guardians of this city's budget.
But in 'other news', some of the others put up a road block as Young, Fleming and Johnson, as well as Okray voted against purchasing certificates of obligation for projects that should have been paid for years ago.
Copy: 'Still, council members can’t seem to agree on how to proceed with cutting expenses or boosting revenue.' End of copy.
If I was on this council, I would start by 'trimming all of the fat that exists in this city government'.
Next, as I have noted many times before, this city should be forthright in divulging 'ALL of this city's encumbrances and I mean all by this next Tuesday's meeting, August 16, 2016.
This city council should seriously look into what the forensic edit encompasses and do not allow any one of the past city personnel to be in any way associated with this forensic audit. This volunteering to be associated in any way just illustrates why we don't want 'any involvement of past city employees'. Do this as an emergency type of resolution and get it passed now.
For this council to be effective, this council must be made aware of 'all' of the indebtedness that this city is obligated for and I would start with the #32 MBD Water treating plant. What needs to be explained to this city council is 'where is and does it hold true that this city is still holding to the same amount of water to be delivered as stated with contract completion or has the basis of the contract, due to Georgetown being in the drivers seat and now the city of Killeen is warranted with less than the agreed upon volume of water. It is most urgent that this city define what are the parameters now, and do it now. I have been asking for this information for months now with no success.
If it turns out that the city of Killeen can no longer obtain the original quantity, then I suggest this city start action to 'shut down this facility and stop payments which will save a considerable amount of outlay to the city budget.
I see it as imperative that this council receive these answers on Tuesday, August 16, 2016 in order to validate 'where we are, where we stand, and what is to be done in the future'.
One of the 3% who voted.

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