Citizens still left with more questions than answers after town hall in Charles City

An open town hall to discuss issues with Charles City County including the borrowing of $5.2 million seemed to leave more questions than answers.

Interim County Administrator Bill Coada conducted the Dec. 12 meeting in a packed auditorium to discuss the county’s financial situation.

Coada opened up the dialogue speaking about the county’s fund balance depleting at a rapid rate over the previous three years. The former county supervisor commented that the county receives two paychecks a year; one from real estate taxes and the other from personal property taxes. But over the past few years, income to the county has been limited due to limited economic development.

Representatives of Davenport and Company, who act as financial advisors for the county, spoke at the meeting, speaking on their involvement in the process. During FY2024, county staff alerted Davenport and Company about the county’s cash on hand running at a substantially lower level than the previous years. Davenport and Company began investigating, seeing that the county’s fund balanced declined by $3 million in FY2023. That decline began with unrestricted cash and cash equivalents dropping by 48 percent.

Davenport said that Charles City County had not borrowed money for capital projects in several years, but expenditures continued to rise. An example was provided using 2019 with expenditures reaching $24.8 million, with cash equivalents equaling out to $9.9 million. For FY2023-24, expenditures totaled $33.9 million, with cash equivalents being down to $5.6 million. So far in FY2024-25, no money has been utilized from the fund balance to budget, which is a positive sign according to Davenport.

The Revenue Anticipation Note (RAN) issued earlier this year was a way to help the county bridge their financial gap. Coada commented the county spends approximately $434,000 a week ($1.736 million a month) to operate the county. The short-term RAN will mature in on June 30, 2025, with the county having to pay it back the next fiscal year. Coada added that the RAN will help the county temporarily due to the limited revenue currently coming in.

Citizens have asked for a forensic audit of the county finances. Davenport and Company will evaluate the audit to determine how to address the issues of structural balance, eliminating the need for short-term cash borrowing, restoring the fund balance, if longer term debt is needed for capital projects, and how to fund key and maintained services. A five-year plan was recommended to outline future revenue, with board of supervisor members in attendance saying that possible job cuts and other funding eliminations, including to county schools, may be a possibility.

When the public had an opportunity to talk, citizens seem to have more questions than answers. One citizen questioned how former Charles City County Administrator Michelle Johnson (see related story on website) worked in the finance department and was elevated to the county administrator position. The citizen also charged that the finance department was terminated for embezzling while Johnson was elevated, which county supervisors and the interim county administrator did not address.

In other issues addressed by Coada during at the town hall:

–Spoke about the process of getting an item on the ballot for vote. Coada said that the process is not easy, as signatures are required to be on a petition to create a referendum, and then the petition must head to the circuit court to be approved to appear on the ballot.

–Commented about the options for the Neighborhood Facility Building. The building, which use to host social services and the sheriff’s office, has been unusable for several years due to molding and deteriorating conditions. Currently, only archived items remain in there, but many of those items are suffering from mold damage. The original plan was to host a café and brewery, but the project fell through due to interest and inflation rates. Coada said the value of the building’s worth of $1.6 million was wrong at the time. He added that demolishing the building would not be of worth to the county at the cost per acre to resurface the area as a parking lot for Hillside Park and the bike trail. As of today, the building is free of hazardous material and is ready for final buildout and usage according to the interim county administrator.