EC Council Hires Consultant To Help With City Finances, Tezai To Be Paid Up To $172K

EC Council hires consultant to help with city finances; Tezai to be paid up to $172K
By Paul Nielsen The Daily Advance Staff Writer

City Council voted Monday night to hire a financial consultant to assist with managing Elizabeth City’s finances — a move that could cost the city up to $172,000 and one that the state Treasurer said wouldn’t be necessary if the city had more qualified management.

Following a closed session, City Council unanimously approved a contract with retired Durham County Chief Financial Officer Susan Tezai to serve as the city’s financial consultant.

Tezai will be paid $250 an hour to assist the city with its finances and long-term debt management. The maximum she could be paid is $172,000 a year.

Mayor Kirk Rivers said instead of hiring an assistant city manager — a position that has been vacant for two years but that has been budgeted for — the city will use that money to pay Tezai. He said City Manager Montre Freeman made the recommendation to use the money from the vacant assistant city manager position to pay for a financial consultant.

Rivers, who does not cast a vote unless there is a tie among the eight councilors, said City Council discussed the contract with Tezai at length before unanimously voting to hire her.

“The council asked a lot of questions and they were all very concerned to make sure there was no wasteful spending of the taxpayers’ dollars,” Rivers said.

Rivers said Tezai’s expertise is needed because the current council is “playing catchup” trying to correct problems it inherited from previous councils. He noted that the last time the city submitted an annual audit on time was in 2017. He also cited turnover in the city’s finance director position since late 2020 and the fact that current Finance Director Alicia Steward has only been on the job eight months.

Rivers and the current City Council took office 13 months ago.

“We are not excited about having all of this,” Rivers said. “But until we get everything caught up, until we get everything on sound ground, City Council will look at all avenues to make sure we put the city on solid (financial) ground.”

The city has already spent close to $500,000 on an outside accounting firm for help completing past-due audits and getting its monthly bank account reconciled.

The city hired the Greg Isley CPA firm at a cost of $100 an hour in October 2021 on the recommendation of then interim City Manager Eddie Buffaloe, who is now secretary of public safety for the state of North Carolina. The move was part of a corrective action plan the city filed with the state’s Local Government Commission at the time. The city had been added to the LGC’s Unit Assistance List in 2020 after failing to file its required annual audits on time.

State Treasurer Dale Folwell said Friday that he is not worried about the Tezai’s qualifications but is concerned about the qualifications of Freeman and Steward to manage the city’s finances, saying they are the “people the taxpayers are already paying for.”

“That is resulting in this expenditure having to be made,” Folwell said. “The taxpayers are double or triple paying for these basic services. This is not my opinion. Obviously, it is the opinion of the City Council and the mayor. Why would they enter into this contract if they didn’t think that they had problems? It’s like an onion, the more we peel the more we cry. The taxpayers deserve better.”

Tezai recently retired as the Durham chief financial officer after being appointed to the position Jan. 1, 2018. She was previously the assistant CFO in Durham for 16 years and spent more than 30 years with the county’s finance department.

The move to contract with Tezai comes as the city is still on the LGC’s Unit Assistance List. Besides the late audits, the city has encountered other financial bookkeeping problems, including a failure to reconcile its books for many months.

The city completed one of the two most recent past due audits (2020-21) this past April and city officials said Monday that the past-due 2021-22 audit, that was due last Oct. 31, will be finished in the next 30 days.

The city’s 2022-23 audit for the fiscal year that ended June 30 is due Oct. 31 and Rivers is confident that the city will meet that deadline.

“It’s been seven years since the city has submitted a budget on time,” Rivers said. “We are track to do three audits in one year.”

According to her profile on the Government Finance Officers Association’s webpage, Tezai earned a bachelor of science degree in accounting and had minors in mathematics and business administration from Elon University. She also completed the Public Executive Leadership Academy at the University of North Carolina School of Government.

She is a certified public accountant licensed by the states of North Carolina and Virginia and a member of the Government Finance Officers Association, North Carolina Government Finance Officers Association, the American Institute of Certified Public Accountants and the North Carolina Association of Certified Public Accountants.