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Petersburg leaders announce $8 million fund balance years after financial crisis

"This progress has been as great as any I've seen..."
Posted at 5:18 PM, Jul 21, 2020
and last updated 2020-07-21 17:26:20-04

PETERSBURG, Va. -- Three years ago, the City of Petersburg was at the brink of financial disaster. Now, city leaders say Petersburg is starting to recovery financially.

"We are pleased to announce the city has increased it's positive unassigned fund balance to just over $8 million," Mayor Sam Parham announced Tuesday morning.

The announcement comes from the results of the city's Comprehensive Annual Financial Report (CAFR) for Fiscal Year 2018-2019.

"This is the highest fund balance the City of Petersburg has had in 10 years," said City Manager Aretha Ferrell-Benavides.

For People living in Petersburg the news means a major shift for what once was a bleak outlook.

"Just 3 years ago, the city was faced with a $7.7 million deficit," said Parham.

“This is proof that our strategic budgeting and financial practices are working,” said Ferrell-Benavides. “Our team continues to do the work to foster sustainable change. We are committed to correcting the practices that resulted in the fiscal stress and implementing innovative policies to continue moving this City forward.”

Davenport and Company, the city's financial advisers, say it's one of the best turnarounds they've seen.

"In the last three years, this progress has been as great as any I've seen in the 40 years I've had the good fortune of working with local governments here in my home state of Virginia," said David Rose, Senior Vice President at Davenport and Company.

Davenport and Company says one reason for the city's strong CAFR is the City has a strong hold on it's cash flow.

The City had other good financial news as well.

"We were able to report today, even our water-sewer utility fund reported $2 million in fund balance, revenue over expenditures," said Ferrell-Benavides.

The City though still has to overcome issues with billing and collections, though collections are now said to be at 85 percent.

"I think the city can feel justifiably proud of what they did, but there's a long ways to go," said Barb Rudolph, with Clean Sweep Petersburg, a government watchdog group.

The City Manager admits there are problems but change is in the works.

"We know and we acknowledge we have been operating on a very antiquated fiscal system and one of the commitments we've made is to look towards moving to a more up to date technology system, that will change the course," said Ferrell-Benavides.

One change already in place to put money into the city coffers quicker deals with the city treasurer, according to Ferrell-Benavides.

"He recently signed a memorandum of understanding with the city, to allow us to assist getting some of the things that take longer to do, to assist in that," she added.