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Gosnell haggles over budget, expense account

Wednesday, January 23, 2013

GOSNELL -- A budget for 2013 was passed by members of the Gosnell City Council at their finance committee meeting Tuesday night, although it was commonly acknowledged that many questions still exist regarding the projected numbers in their current state.

At the committee's last meeting, council members raised questions about multiple line items in the proposed 2013 budget which did not match up with their corrosponding numbers in the statements of revenues and expenditures from 2012. In addition, there also appeared to be multiple discrepancies on the 2012 reports between the dollar amounts budgeted for line items and the amounts actually spent. Council members also discovered that two versions of the proposed budget for 2013 had been circulated, and were unsure which of them was correct. Mayor Don Marshall was unable to answer most of the questions without information from city hall employees, so the budget was tabled until the Tuesday meeting.

Tuesday night, Gosnell City Clerk Kathy Hogan was present to answer questions about the budget, and newly appointed finance committee chairman Eric Blount informed council members that many of the discrepancies in the numbers were because of "glitches" in the city's new bookkeeping software. Blount said city hall employees are still dealing with difficulties in transitioning to the new software, which was installed in March of 2012, and advised that the council pass the budget knowing there may be mistakes, but with the understanding that revisions and amendments can be made once software issues are settled.

Council member Nita Reams expressed uneasiness with this idea.

"Are these the real numbers," she asked. "I'm not comfortable with it. There was nearly a $50,000 difference in the numbers on turnback funds, for example. Are we just going to say that the computer was wrong?"

Hogan said she did not understand why council members were unhappy with the numbers in their current state, but added that some of the confusion is because all of the city's funds have not been properly allocated.

"Some things got put in the wrong place and I just haven't been able to get in and fix it yet," she said.

In response to council member Mellisa Querry's question about why these problems are still existing since last March, Blount again suggested that the council pass this budget, "then take another look in June."

"But would you have a software system in your business that can't give you accurate numbers?" asked Reams.

Quearry responded to Blount's suggestion by saying that the council took similar measures in dealing with budget discrepancies last year, and ended up in the hole on street funds.

"And we made that work by moving the money around," answered Blount. "We bend the budget; that's the way it's been done for years. Budgets are always amended and changed as the year progresses. If we get locked down into all this we're not going to be able to move forward because we're still working the bugs out of our software system."

"But that's not a good way to do business," said Reams.

"We just want to know what it's going to take to get it correct," said Quearry. "I don't want us to be in this position next year."

"That's why we can revisit it later if it's not shaping up," answered Blount.

Reams said if the council was going to pass the budget as is, she wants to know when training will take place for city hall employees to learn how to properly navigate the new system.

"I just don't believe that we have a software program and no one who knows how to use it," she said. "There has to be some accountability for a time when these numbers will be right."

"Everyone looks at a budget differently," said Hogan. "A set of numbers in an account can look one way to one person's mind and a different way to another person's mind. We know what we're doing, but I guess we need to put it in the way that ya'll want. The budget is just numbers -- you can add to or take away from it anytime."

"I just know that if I presented this to the CFO to my company, he would have an absolute runaway," said Reams.

Mayor's expense account

Newly elected council member Steve Nelson then broached the topic of the mayor's expense account, which was brought into question during the last budget meeting, when Marshall told council members that he was using the expense account for clothing, food and other daily living expenses for him and his family. Nelson said he had reviewed copies of all the receipts for which Marshall was reimbursed through this account over the last year, and said the way the money was being spent was not appropriate for a city-funded expense account.

"I am appalled at these receipts for food and shopping for you and your family. That is not what the people of Gosnell are expecting -- meals and clothing and personal items for the mayor," he said.

Marshall contested that the agreed upon $600 a month provided in his expense account was meant to act as a supplement to offset his low salary as a part-time mayor, and that his understanding was that he would operate in the same way as former Mayor Dick Reams by using the expense account as part of his regular income.

"You all are trying to turn this expense account issue on me," he said. "You can spin this all you want, but I am doing this the same way as the former mayor. You are spinning this to make me look like a bad guy."

"I looked at this as a citizen of Gosnell," said Nelson. "It's supposed to be used to bring business into our town or to entertain dignitaries. It's not for Sonic, Subway, clothing and deodorant."

Blount supported Marshall in his assertion that the expense account has been and still is being used as a way to supplement the income of the mayor without raising salaries, which keeps the expense of retirement benefits down. Along this line of thinking, he said, the expense account is an extension of the mayor's income and can be used at his discretion.

"This is the way that the fathers of our city decided to put this down as a way to supplement our mayor's income," he said. "The former mayor agreed to take pay raises in the form of his expense account instead of in his salary. It was taxed income, so he could do what he wanted with it. We've been doing it that way and we should continue doing it that way."

"You're comparing apples to oranges," said Querry. "Mayor Marshall is a part-time mayor. He works another full-time job and is receiving this expense account money through reimbursement. Just because things were going on a certain way doesn't mean they should continue going that way."

Querry added that according to Arkansas code on mayoral expense accounts, Marhall's expenditures do not match up with the types of things that should be reimburseable.

Marshall interjected that council members were continuing to "spin" the expense account issue against him.

Josh Trapp added that he didn't feel the council should attempt to take away the expense account, one of the mayor's incentives for doing a good job for the city.

Nelson suggested that if Marshall wants to view his expense account as a supplement to his income, the city just add it to his salary.

"I'm just telling you that when I came into office I agreed to turn in receipts, but I came in with the understanding that like the previous mayor, I could use that expense account money to offset my low income. What has changed between and the other mayor? My last name has changed and that's all," said Marshall.

"We said we weren't going to come in this year on the council with personal vendettas," said Blount.

"You say that, but after the last meeting we had on the budget, you called me and jumped me over the decisions that we made," said Nelson.

"That is not a true allegation. I don't jump anyone," said Blount.

"Well, that was my perception of it," said Nelson.

"On a national level we're seeing that Congress can't get along, and I guess that is what it's coming down to on a local level. Does it have to be that our city council can't get along either?" Blount asked the group.

"Each person on this council has to search their heart and do what they think is right," said Querry "I'm trying to do what I thing is best. I'm not meaning to be harsh. Forgive the old council for not having the structure that needs to be in place. We failed, but moving on, let's lay things out so everyone knows what's expected of them."

After more discussion, the council passed a motion to change the fund in question from an expense account to an expense allowance. This money would be taxed income, and would therefore be the mayor's to spend as he pleases.

Also discussed were possible sources of funding for improvements to the city park, as well as other projects which could be funded through grant money.

"I may need to apologize to the mayor and Eric," said Nelson. "We've come into some tough issues in the last month, and I may have taken some things wrong. But I like the way that we are now having some agreeable forum here. I'm new and I'm still learning, but I do intend to go over my facts and find the answers."

"It takes a lot of courage to be the person who speaks up," said Blount. "In the past, we've never seen people come on to the council and immediately jump on board like you guys have."

The council voted to pass the proposed budget with the understanding that necessary corrections would be made within three months.


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