In Letters, 20+ Citizens Ask LGC To ‘Please Take Over’ Finances

In letters, 20+ citizens ask LGC to ‘please take over’ finances
By Paul Nielsen Staff The Daily Advance Writer Jun 22, 2023

The state’s Local Government Commission has received almost two dozen letters from city residents asking for the state agency to take over Elizabeth City’s finances.

Deputy state Treasurer Sharon Edmundson told the LGC at its June 6 meeting that 23 letters from city residents have been sent to the agency with “all basically saying the same thing.”

“They want the LGC to step in and take control of the finances of Elizabeth City,” Edmundson told the LGC at its June 6th meeting.

The 23 letters to the LGC were sent between Dec. 11, 2022, and June 4 of this year, with 18 being sent in May. The Daily Advance received copies of the letters from the state Treasurer’s Office on Tuesday.

State Treasurer Dale Folwell sent a letter to City Council in March asking the city to ask the LGC to step in and assume control of the city’s finances. Folwell said in the letter, which became public about a month after he sent it, that the city was facing a “cash crisis.”

Elizabeth City is currently on the LGC’s Unit Assistance List mainly because the city was late submitting required fiscal year audits of its finances.

The city’s 2020-21 audit that was due Oct. 31, 2021, was delayed because of financial bookkeeping problems dating back to the summer of 2020. But it was submitted to the LGC in April and it showed 12 material weaknesses.

Since the 2020-21 audit was not completed on time the city’s 2021-22 audit that was due last October 31 is also late. City officials have said that its outside auditor PB Mares is currently working on the audit and it should be completed in the next few weeks.

Many of the letters are critical of the leadership and experience of City Manager Montre Freeman and the city’s Finance Department and their ability to manage the city’s finances. Some also criticize the city for having to hire the outside accounting firm Greg Isley to help straighten out the city’s financial statements.

The letters also contain criticisms of the city’s ability to properly address needed infrastructure improvements to its aging water and sewer system.

Gerry Anderson wrote in his letter that he was born and raised on Main Street, graduated from Elizabeth City State University and returned home to the city after retiring following a 40-year work career. He wrote on May 10 that “public confidence in government depends on proper stewardship of public money.”

“Our city’s reconciliations and audits are not up to date,” Anderson wrote. “There are significant unexplained discrepancies reported in our accounts. Our inexperienced city finance staff appears to lack the necessary expertise to make sense of it all. As a result, our city is simply unable to accurately forecast future revenues and expenses and cannot plan and prepare an accurate budget. In the meantime, our proud city is being held together by Band Aids, duct tape and baling wire.”

H. Creighton Foreman said in his June 4 letter to the LGC that he is a retired CPA with 37 years of experience in finances. He asked that the state “please take over the finances of Elizabeth City.”

“The current finance department and management cannot handle the situation,” Foreman wrote. “HR (Human resources) continues to hire personnel that cannot handle basic accounting procedures. We need to quit spending taxpayer funds on expensive additional CPA services to complete the job that the personnel have been hired to do. These employees need to be replaced by personnel that you (LGC) hire.”

Foreman suggested in his letter that Pasquotank County be hired to take over the city’s finances.

“Pasquotank County seems to be able to handle their finances,” Foreman wrote. “We need to merge EC into the county.”

David Harris told the LGC in his letter dated May 11 that he served as Pasquotank county manager for eight years in the 1980s and he understands the importance of local governments maintaining strong and stable finances with public accountability.

“It is more than evident that the city manager does not have the knowledge and experience to manage the city,” Harris wrote. “A majority of the elected officials on City Council do not understand the importance of the financial problems that are going on.”

Harris further wrote that it is time for the city to have sound financial management and accountability and that can only be achieved by the LGC “taking complete control of Elizabeth City’s finances.”

“Enough is enough,” Harris said.

Peter Thomson wrote on May 10 that city residents are torn between two realities of “what the LGC says and what our untrained manager and mayor say.”

“Our downtown is booming, our population is growing and our finances are in a mess,” Thomson wrote. “Please consider taking over here before things get worse.”