There was a wealth of knowledge shared at this year’s NJ League of Municipalities Conference. The poor health of the economy brought hundreds of attendees to an early morning session entitled "Multi Year and Long Range Financial Planning". The session was informative, reminding elected officials and administrators of the basics of financial planning as well as highlighting increasingly popular methods of stretching taxpayer dollars.
A general consensus among the presenters was that a quality long-term budget forecasts 5-8 years out. It would be wise for Plainfield to plan that far out in advance. Of course, forecasting is only possible with meaningful historic data that has been analyzed appropriately. One of the first steps Plainfield must take is giving meaning to historic data. Understanding expenses and revenue streams aid in identifying financial opportunities and challenges.
During the week‘s many events, Governor Corzine proposed a temporary deferment of 50% of municipal payments into the state pension fund. The proposal requires legislative approval. However, if passed, New Jersey municipalities could opt to defer over $1 billion in pension fund payments. Governor Corzine emphasized that this would be a temporary deferment only and that payments would be made gradually by 2012 (original payment due + interest).
Such a deferment would certainly help Plainfield meet its immediate budget needs. However, other solutions still need to be explored. The Governor (and many others) emphasized shared equipment and services. Such methods have had a meaningful impact in surrounding communities. The Mayor and Council should be looking to extend or implement shared services agreements where logical.
In this “bail out plan” economy, we need to weigh every possible option in order to ease our financial woes. Getting a handle on Plainfield’s financial health must be made a priority if we are to move forward.
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Sunday, November 23, 2008
Sunday, November 9, 2008
A New Chapter in American History
Election night was one of the few nights I’ve heard my grandmother, so overwhelmed with emotion, cry the way she did. During our “Can you believe he just won?” phone conversation, I could barely understand my grandmother. She was sobbing tears of joy and disbelief. She recalled the hardships of growing up in Jim Crow South, raising children who would integrate the Arkansas school system and making the world’s best dinners for her grandchildren and their very diverse group of friends. She had already seen so much change already, but to see President-elect Obama and the new First Family stand victoriously on stage was not something that she expected to see in her lifetime.
This moment in time is a new chapter in America’s story. When my kids study Modern American History, they will ask me where I was and what I was doing when President Obama won the 2008 election. I will happily tell them that I was celebrating with family and friends in Plainfield, NJ where we were overwhelmingly pro-Obama and voted for change in our city.
Thank you to all the voters who supported me in this election and to all the voters who supported Obama. I look forward to bringing change to Plainfield just as Obama will bring change to our nation.
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This moment in time is a new chapter in America’s story. When my kids study Modern American History, they will ask me where I was and what I was doing when President Obama won the 2008 election. I will happily tell them that I was celebrating with family and friends in Plainfield, NJ where we were overwhelmingly pro-Obama and voted for change in our city.
Thank you to all the voters who supported me in this election and to all the voters who supported Obama. I look forward to bringing change to Plainfield just as Obama will bring change to our nation.
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Sunday, October 26, 2008
Audit Findings Continued
The October 12 entry detailed three of the ten Audit Findings (Findings #1, 3 and 4). Because I’ve received so much feedback on that particular post and have responded to many questions on what the remaining findings were, I’ve decided to post that today. As the City continues the budget process, these are important to keep in mind.
Finding #2: Funds are not encumbered against amounts appropriated before goods or services ordered and purchases are made without any certification of availability of funds obtained from the Comptroller.
Recommendation: The encumbrance accounting system required by the Division of Local Government services should be adequately maintained.
Corrective Action: While the City has centralized purchasing system, it is not currently enforced. As stated in the Finding #1, a meeting will be held to train department heads and other responsible parties as to the proper purchasing procedures. Current financial software has provisions for encumbrance off all the purchase orders and ability to certify funds before purchases are made. Procedures will be changed in the Audi & Control Division to ensure that certification of funds are prepared and funds are encumbered on a timely basis. Access to the purchasing module of the financial software will be provided to various departments. Training will be held on the purchasing module. A procedure manual on purchasing and encumbrances will also be developed.
Implementation Date: October 2008
Finding #5: A detailed analysis of outside liens redeemed was not maintained.
Recommendation: Detailed analysis of outside liens redeemed should be maintained.
Correction Action: An outside consultant was hired to assist the Tax Department in addressing all redemption issues. The Tax Collector will analyze all information from the Tax Sale and subsequent redemptions and prepare an outside liens redeemed schedule. This schedule will be reconciled with the Audit & Control Division. Future reconciliations will be done on a monthly basis through bill lists and other means.
Implementation Date: October 2008
Finding #6: A detailed list of tax sale premiums collected was not maintained.
Recommendation: Detailed list of tax sale premiums collected should be maintained.
Corrective Action: The Tax Collector will analyze all information from the Tax Sale and subsequent redemptions and prepare a tax sale premiums schedule. This schedule will be reconciled with the Audit & Control Division. Future reconciliations will be done on a monthly basis through bill lists and other means.
Implementation Date: October 2008
Finding #7: Cancellation of tax overpayments were recorded as an increases to the levy instead of being shown as a reduction of liability.
Recommendation: Cancellation of tax overpayment be recorded on the tax computer system as a reduction of liability.
Corrective Action: Tax Collector procedures will be reviewed. Additional instructions and training may be necessary for all employees. Tax Overpayments will be reconciled monthly through monthly report, bill lists and other means.
Implementation Date: November 2008
Finding #8: A detailed analysis of federal and state grants receivable is not maintained.
Recommendation: Detailed analysis of federal and state grants receivable should be maintained.
Corrective Action: State grants receivable ledger will be computerized for SFY 2009. The Grants coordinator will be responsible for maintenance of this schedule.
Implementation Date: July 2008
Finding #9: The City has numerous inactive account balances in the sewer utility fund.
Recommendation: All inactive account balances should be reviewed for cancellation.
Corrective Action: All accounts in sewer utility fund will be reviewed during SFY 2009 budget preparation and provisions will be made for account balance cancellations. A resolution will be submitted to the City Council for the approval of cancellations.
Implementation Date: (This was left blank on the form I have)
Finding #10: An item “Deferred Charges - Cancelled receivable” which has remained unchanged for many years in the general capital fund should be reviewed.
Recommendation: The balance for Deferred Charges - Cancelled Receivables should be provided for.
Corrective Action: A balance for Deferred Charges - Cancelled Receivables will be reviewed during SFY 2009 budget preparation. Provisions will be made for account balance cancellations.
Implementation Date: September 2008
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Finding #2: Funds are not encumbered against amounts appropriated before goods or services ordered and purchases are made without any certification of availability of funds obtained from the Comptroller.
Recommendation: The encumbrance accounting system required by the Division of Local Government services should be adequately maintained.
Corrective Action: While the City has centralized purchasing system, it is not currently enforced. As stated in the Finding #1, a meeting will be held to train department heads and other responsible parties as to the proper purchasing procedures. Current financial software has provisions for encumbrance off all the purchase orders and ability to certify funds before purchases are made. Procedures will be changed in the Audi & Control Division to ensure that certification of funds are prepared and funds are encumbered on a timely basis. Access to the purchasing module of the financial software will be provided to various departments. Training will be held on the purchasing module. A procedure manual on purchasing and encumbrances will also be developed.
Implementation Date: October 2008
Finding #5: A detailed analysis of outside liens redeemed was not maintained.
Recommendation: Detailed analysis of outside liens redeemed should be maintained.
Correction Action: An outside consultant was hired to assist the Tax Department in addressing all redemption issues. The Tax Collector will analyze all information from the Tax Sale and subsequent redemptions and prepare an outside liens redeemed schedule. This schedule will be reconciled with the Audit & Control Division. Future reconciliations will be done on a monthly basis through bill lists and other means.
Implementation Date: October 2008
Finding #6: A detailed list of tax sale premiums collected was not maintained.
Recommendation: Detailed list of tax sale premiums collected should be maintained.
Corrective Action: The Tax Collector will analyze all information from the Tax Sale and subsequent redemptions and prepare a tax sale premiums schedule. This schedule will be reconciled with the Audit & Control Division. Future reconciliations will be done on a monthly basis through bill lists and other means.
Implementation Date: October 2008
Finding #7: Cancellation of tax overpayments were recorded as an increases to the levy instead of being shown as a reduction of liability.
Recommendation: Cancellation of tax overpayment be recorded on the tax computer system as a reduction of liability.
Corrective Action: Tax Collector procedures will be reviewed. Additional instructions and training may be necessary for all employees. Tax Overpayments will be reconciled monthly through monthly report, bill lists and other means.
Implementation Date: November 2008
Finding #8: A detailed analysis of federal and state grants receivable is not maintained.
Recommendation: Detailed analysis of federal and state grants receivable should be maintained.
Corrective Action: State grants receivable ledger will be computerized for SFY 2009. The Grants coordinator will be responsible for maintenance of this schedule.
Implementation Date: July 2008
Finding #9: The City has numerous inactive account balances in the sewer utility fund.
Recommendation: All inactive account balances should be reviewed for cancellation.
Corrective Action: All accounts in sewer utility fund will be reviewed during SFY 2009 budget preparation and provisions will be made for account balance cancellations. A resolution will be submitted to the City Council for the approval of cancellations.
Implementation Date: (This was left blank on the form I have)
Finding #10: An item “Deferred Charges - Cancelled receivable” which has remained unchanged for many years in the general capital fund should be reviewed.
Recommendation: The balance for Deferred Charges - Cancelled Receivables should be provided for.
Corrective Action: A balance for Deferred Charges - Cancelled Receivables will be reviewed during SFY 2009 budget preparation. Provisions will be made for account balance cancellations.
Implementation Date: September 2008
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Sunday, October 19, 2008
A Costly Mistake, A Short-Sighted Solution
The $1.66MM accounting error is now the mistake heard ‘round the world. I won't comment on how Plainfielders are feeling let down by the Administration again. There has been plenty of commentary on that.
I do want to address the solution proposed to the Courier News by City Administrator Marc Dashield. Mr. Dashield suggests dipping into the Reserve Fund. This is like putting a band-aid on a 3rd degree burn. Whether this will be necessary in the short-run remains to be seen, but regardless of that outcome a long-term solution is needed.
The Reserve Fund, for all intents and purposes, is an accounting concept. It’s not a savings account and should not be seen as a “rainy day” fund. In reality, it represents the difference between an organization’s current assets and current liabilities - in other words, it is the amount that would be left over if the City sold all of its assets for cash and paid off all debt owed within the next year. This is an important benchmark of financial health because it measures our ability to continue to pay immediate and ongoing expenses (long-term contracts, capital expenditures, etc) without having to take on too much debt.
This mistake is really just shining light on the City’s fiscal health. This additional, unexpected deficit brings total revenues lost to $5.2MM. What caused this loss? How will we address these losses in the long-term? Dipping into the Reserve Fund now may mean easing the tax burden today. But the Reserve Fund has limited resources. Unless something is done to address Plainfield’s financial health, taxpayers will eventually be burdened with higher taxes.
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I do want to address the solution proposed to the Courier News by City Administrator Marc Dashield. Mr. Dashield suggests dipping into the Reserve Fund. This is like putting a band-aid on a 3rd degree burn. Whether this will be necessary in the short-run remains to be seen, but regardless of that outcome a long-term solution is needed.
The Reserve Fund, for all intents and purposes, is an accounting concept. It’s not a savings account and should not be seen as a “rainy day” fund. In reality, it represents the difference between an organization’s current assets and current liabilities - in other words, it is the amount that would be left over if the City sold all of its assets for cash and paid off all debt owed within the next year. This is an important benchmark of financial health because it measures our ability to continue to pay immediate and ongoing expenses (long-term contracts, capital expenditures, etc) without having to take on too much debt.
This mistake is really just shining light on the City’s fiscal health. This additional, unexpected deficit brings total revenues lost to $5.2MM. What caused this loss? How will we address these losses in the long-term? Dipping into the Reserve Fund now may mean easing the tax burden today. But the Reserve Fund has limited resources. Unless something is done to address Plainfield’s financial health, taxpayers will eventually be burdened with higher taxes.
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Sunday, October 12, 2008
Audit Findings Highlight Poor Fiscal Responsibility
Perhaps unintentionally, the budget hearings have highlighted more than just how tax dollars will be spent in the new fiscal year but, also, how well City Hall is being run. Throughout the hearings the Audit Report for fiscal year ending June 30, 2007 has been referenced. Findings in the report (submitted July 2008) are being used to gauge success in the coming year.
There were 10 findings that the City created corrective action plans for. I’ve listed 3 of the most disturbing findings and their corrective action plans below. This is simply poor business management. Pressure must be put on the Administration and the Council to ensure that these corrective action plans are actually put in place.
Finding: Numerous purchases are made directly by various division heads and not through the Division of Purchasing.
Recommendation: City purchases should be made through the Purchasing Agent.
Corrective Action: A revised purchasing policy will be developed and distributed to all employees. A meeting will be held with all of the department heads and other employees responsible for purchasing within various divisions to discuss new policies and procedures supporting the new purchasing policy. Guidelines will be developed to ensure that all purchases are centralized. Monthly reports for compliance monitoring will be provided to the administration. The City Administrator and Director of Administration and Finance will enforce adherence to purchasing policy. Vendors will be notified that the City of Plainfield will only honor purchases accompanied by a purchase order number.
Implementation Date: October 2008
Finding: A detailed analysis of foreclosed properties was not maintained.
Recommendation: Detailed analysis of foreclosed property should be maintained.
Corrective Action: Research is being conducted to identity all foreclosed properties. An electronic file of each foreclosed property will be prepared and maintained by the Tax Collector.
Implementation Date: July 2008
Finding: A monthly report detailing non-cash transactions made by the tax office was not provided to the finance office. Since this was not done, the Current Fund general ledger was incomplete.
Recommendation: A monthly report detailing non-cash transactions made by the Tax office should be provided to the Audit & Control Division.
Corrective Action: An outside consultant was retained to assist the Tax Collector in developing month-end reports. Reports for SFY 2008 were prepared and provided to the Audit & Control Division by the end of SFY 2008.
Implementation Date: July 2008
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There were 10 findings that the City created corrective action plans for. I’ve listed 3 of the most disturbing findings and their corrective action plans below. This is simply poor business management. Pressure must be put on the Administration and the Council to ensure that these corrective action plans are actually put in place.
Finding: Numerous purchases are made directly by various division heads and not through the Division of Purchasing.
Recommendation: City purchases should be made through the Purchasing Agent.
Corrective Action: A revised purchasing policy will be developed and distributed to all employees. A meeting will be held with all of the department heads and other employees responsible for purchasing within various divisions to discuss new policies and procedures supporting the new purchasing policy. Guidelines will be developed to ensure that all purchases are centralized. Monthly reports for compliance monitoring will be provided to the administration. The City Administrator and Director of Administration and Finance will enforce adherence to purchasing policy. Vendors will be notified that the City of Plainfield will only honor purchases accompanied by a purchase order number.
Implementation Date: October 2008
Finding: A detailed analysis of foreclosed properties was not maintained.
Recommendation: Detailed analysis of foreclosed property should be maintained.
Corrective Action: Research is being conducted to identity all foreclosed properties. An electronic file of each foreclosed property will be prepared and maintained by the Tax Collector.
Implementation Date: July 2008
Finding: A monthly report detailing non-cash transactions made by the tax office was not provided to the finance office. Since this was not done, the Current Fund general ledger was incomplete.
Recommendation: A monthly report detailing non-cash transactions made by the Tax office should be provided to the Audit & Control Division.
Corrective Action: An outside consultant was retained to assist the Tax Collector in developing month-end reports. Reports for SFY 2008 were prepared and provided to the Audit & Control Division by the end of SFY 2008.
Implementation Date: July 2008
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Monday, October 6, 2008
Muhlenberg Advertising
After months of non-stop coverage of the Muhlenberg closure, it seems as though attention is fading from the hospital. The tremendous amount of effort that a number of individuals and organizations, such as POP, poured into saving Muhlenberg was certainly worth the coverage. Plainfielders put up a fight that will serve as a model for other municipalities facing similar situations.
And the fight continues, as it should, although the latest news hasn’t helped to reignite attention: the City’s appeal to reverse the decision to grant Solaris a certificate of need has been denied by Commissioner Howard. I hope that action will continue to be taken by the City to restore Muhlenberg to a full-service acute care hospital.
In the mean time, however, more should be done to make Plainfield and the surrounding area aware of what is still available at Muhlenberg - specifically the Satellite Emergency Department (SED). The SED is open 24/7 and provides most basic emergency care. The SED was one of the conditions that Solaris President and CEO John McGee agreed to meet in order to receive the Certificate of Need from Commissioner Howard. It must remain open for a minimum of 5 years. I imagine that at that time an evaluation of the SED will take place to determine whether or not it should remain open and functional.
My concern is that too many people don’t realize that the doors at Muhlenberg are still open, so to speak. If the public is not aware that the SED is open, then no one will use those services and the 5 year evaluation will reflect low usage. The rationale of “high cost, low benefit” has already been used once against our hospital. It would be a shame to let that happen again.
I’ve seen more advertising for JFK and Overlook and Trinitas in the past 6 months than ever before. Advertising for Muhlenberg must be done to keep what we do still have available.
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And the fight continues, as it should, although the latest news hasn’t helped to reignite attention: the City’s appeal to reverse the decision to grant Solaris a certificate of need has been denied by Commissioner Howard. I hope that action will continue to be taken by the City to restore Muhlenberg to a full-service acute care hospital.
In the mean time, however, more should be done to make Plainfield and the surrounding area aware of what is still available at Muhlenberg - specifically the Satellite Emergency Department (SED). The SED is open 24/7 and provides most basic emergency care. The SED was one of the conditions that Solaris President and CEO John McGee agreed to meet in order to receive the Certificate of Need from Commissioner Howard. It must remain open for a minimum of 5 years. I imagine that at that time an evaluation of the SED will take place to determine whether or not it should remain open and functional.
My concern is that too many people don’t realize that the doors at Muhlenberg are still open, so to speak. If the public is not aware that the SED is open, then no one will use those services and the 5 year evaluation will reflect low usage. The rationale of “high cost, low benefit” has already been used once against our hospital. It would be a shame to let that happen again.
I’ve seen more advertising for JFK and Overlook and Trinitas in the past 6 months than ever before. Advertising for Muhlenberg must be done to keep what we do still have available.
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Wednesday, October 1, 2008
Union County Youth Rally feat. Gov. Corzine
The time & location for the Union County Youth Rally has changed:
Union County Youth Rally for Obama
Saturday, October 4, 2008 at 3:00 pm
Warinanco Park on the Elizabeth-Roselle Border
Governor Corzine is also expected to attend.
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Union County Youth Rally for Obama
Saturday, October 4, 2008 at 3:00 pm
Warinanco Park on the Elizabeth-Roselle Border
Governor Corzine is also expected to attend.
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Sunday, September 28, 2008
Breast Cancer Awareness
October is Breast Cancer Awareness Month. 1 in 8 women will be diagnosed with Breast Cancer. While we don’t know the exact causes of breast cancer, we do know that early detection is key to effective treatment and a healthy recovery. Regular mammograms are something that all women 40+ should be getting. You owe it to yourself and to your loved ones.
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Are you registered?
Some residents have concerns about being registered to vote. If you are not sure that you are registered, or still need to register, check out http://www.voteforchange.org/. It’s simple and painless. October 14th is the deadline.
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Sunday, September 21, 2008
Thank You
I’d like to thank the voters of Plainfield for supporting me and Adrian Mapp in the Democratic June Primary. Your overwhelming support demonstrated through time, energy and donations made the campaign a huge success. This is truly a victory for all Plainfield residents.
On a personal note, I know that my father, the late Mayor Albert T. McWilliams, would have been ecstatic about the results of the election. My father was a good man and a great leader. He always put Plainfield residents first when making decisions that would affect the City. I was blessed to have him as a role model and I look forward to moving Plainfield in the right direction with the same level of dedication that my father had.
Speaking of great men, another inspiration of mine is Barack Obama. It is rare to find a candidate that is both intelligent and charismatic with a good heart and true desire to serve the American people. He’s the first nominee in my generation’s recollection that has truly spoken to young adults in America. He’s simply inspirational and I am proud to be on the Democratic ticket with Barack Obama this Fall.
With only 44 days until the November election, the Obama Campaign is in full force. The Plainfield Headquarter’s kick-off event and rally was a success. I encourage any interested resident to make time to volunteer.
There will be a Union County Youth Rally for Obama on Saturday October 4, 2008 in Elizabeth. Tell all the young people you know to come out, get registered to vote and meet young people in the Union County with a passion to bring the change we need to America.
Union County Youth Rally for Obama
Saturday, October 4, 2008 at 2:00 pm
Shiloh Baptist Church (of Elizabeth)
95 Murray Street
Elizabeth, NJ
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On a personal note, I know that my father, the late Mayor Albert T. McWilliams, would have been ecstatic about the results of the election. My father was a good man and a great leader. He always put Plainfield residents first when making decisions that would affect the City. I was blessed to have him as a role model and I look forward to moving Plainfield in the right direction with the same level of dedication that my father had.
Speaking of great men, another inspiration of mine is Barack Obama. It is rare to find a candidate that is both intelligent and charismatic with a good heart and true desire to serve the American people. He’s the first nominee in my generation’s recollection that has truly spoken to young adults in America. He’s simply inspirational and I am proud to be on the Democratic ticket with Barack Obama this Fall.
With only 44 days until the November election, the Obama Campaign is in full force. The Plainfield Headquarter’s kick-off event and rally was a success. I encourage any interested resident to make time to volunteer.
There will be a Union County Youth Rally for Obama on Saturday October 4, 2008 in Elizabeth. Tell all the young people you know to come out, get registered to vote and meet young people in the Union County with a passion to bring the change we need to America.
Union County Youth Rally for Obama
Saturday, October 4, 2008 at 2:00 pm
Shiloh Baptist Church (of Elizabeth)
95 Murray Street
Elizabeth, NJ
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