In much needed lighter news, the City of Alameda is doing its job to “buy Alameda” and have hired Alameda resident, Liz Warmerdam as the Assistant City Manager after the departure of Lisa Goldman.
She is a West End (yay!) resident and started her public service career in Alameda and most recently she has served in Hercules, CA and managed to weather the storm of allegations of corruption and graft there.
From an article about her in the Contra Costa Times:
In 2008 and 2009, as a planning consultant for Hercules, Warmerdam was project manager for the 2009 Updated Redevelopment Plan. She also did entitlement work for the Sycamore Crossing project and handled the environmental impact report for the Hercules Bayfront project. She went back on the city’s employee payroll in late 2010, when then-interim City Manager Charlie Long appointed her finance director. In July 2011, Warmerdam became interim city manager, succeeding then-interim City Manager Fred Deltorchio, who resigned.
Duran began as city manager in October 2011; he appointed Warmerdam deputy city manager shortly after.
Most top Hercules officials from the Sakamoto and Oliva eras have left. In an interview with this newspaper Monday, Warmerdam attributed the fact that she survived unscathed through the tumult to “one word: integrity.”
“And perseverance,” she added.
“People trusted me,” she said. “I didn’t pull any punches. I told people what I thought. I was honest. I have a pretty good work ethic.”
It was sad to lose Lisa Goldman, but it will be exciting to see an Alamedan in such a key position.
I wish her luck. Let’s hope things are on an upswing for the City.
Comment by Denise Shelton — December 19, 2012 @ 7:58 am
Her starting salary is $172,941.
Comment by Dave — December 19, 2012 @ 10:04 am
Hercules in hot water over financial records
State Controller John Chiang blasted the cash-strapped city of Hercules on Thursday for having what he called “the worst set of city accounting records I have seen,” particularly its lack of documentation for $2 million in federal and state grants.
In a pair of scathing audits, Chiang warned that the East Bay city may have to pay back the $2 million it received in 2009-10, and because the “glaring holes” in the city’s accounting may have existed before that time, the city’s liability to the state and federal governments may be higher.
Chiang said Hercules provided auditors with only 15 of 107 documents – many of which were basic ledger statements that any city should have on hand – despite 32 requests for the information during an eight-month review.
Additionally, Chiang said, city staffers often ignored or canceled meeting requests from auditors.
What auditors did learn, according to Chiang, is that – besides the questionable $2 million – the city commingled gas tax receipts with its general fund, among other accounting irregularities.
“The city’s books were so poorly managed that I must question their use of every single federal and state dollar granted to the city,” Chiang said.
Brink of bankruptcy
Hercules, a mostly residential town of 25,000 on San Pablo Bay, has been hovering on the brink of bankruptcy, in part because of the real estate implosion and a string of redevelopment gambles gone awry. The city’s general fund has dwindled from $18 million to about $10.5 million, resulting in the layoffs of 40 percent of City Hall staff in the past year.
Mayor Dan Romero defended Hercules, saying the city did not misspend any state or federal funds. The poor bookkeeping is due to short staffing and turnover in the finance office, he said. Hercules’ city manager explained those challenges to Chiang’s office before the report was released, he said.
The finance staff shrunk from nine to four employees after last year’s layoffs, and the city now has its fourth finance director in less than three years, he said. In addition, the city has a new city manager, city attorney and new council members, following a recall election last year over fiscal and ethical issues.
“We are a city in turmoil,” he said. “The state controller should work with us, not play politics. … It’s like you’re on a submarine under attack, and the captain calls a fire drill.”
The controller’s requests for documents or meetings may have been sent to staffers who were no longer employed by the city, Romero said. As it is, the remaining finance staffers often work until 11 p.m. sorting through the fiscal mess that has accumulated the past few years.
Chiang’s office is not done with Hercules. Two more reports are due in the next few weeks: one on Hercules’ former redevelopment agency, another on its internal controls.
Valid criticism
The controller’s criticisms of Hercules are warranted, said Chiang’s spokesman, Jacob Roper.
“The city was given multiple opportunities over the course of eight months to provide the records requested,” he said. “At the end of the review, there was not even enough information available to conduct a financial audit.”
Among the grants that were unaccounted for are two from the U.S. Department of Transportation, totaling more than $1 million, to build a new transit depot and repave San Pablo Avenue.
The audit will be sent to the U.S. Inspector General’s office, which will probably conduct its own investigation, said a spokesman for the Department of Transportation.
Another grant, for $146,000, came from the federal Environmental Protection Agency for restoring the Chelsea Wetlands.
The city has not yet collected that money, according to the EPA.
The project is delayed because of problems with other funding sources, but Hercules has started looking for consultants and talking to neighbors about the project, according to an EPA official.
Chiang’s office will forward the audit to the state and federal agencies that gave grants to Hercules, and require the city to separate its gas tax receipts from the general fund, along with $39,000 in interest.
A very big loss
Hercules’ financial downfall began when the city borrowed more than $135 million for redevelopment projects before the real estate crash. In the starkest example of the downfall, the city in April sold a four-story apartment building for $425,000 after having sunk more than $38 million into it.
Last year, the city defaulted on a bond payment, resulting in a $4.1 million lawsuit. During the legal wrangling, the city threatened to file for bankruptcy.
The case was settled, but Hercules’ finances remain dire. In June, voters will decide on a half-cent sales tax intended to raise $450,000 a year, a Band-Aid on the city’s $2 million budget deficit.
Deputy City Manager Liz Warmerdam said all the grant money can be accounted for, and the city is slowly fixing its financial problems.
“They think we’re hiding something. We’re not,” she said. “We’re just understaffed.”
Comment by John — December 19, 2012 @ 12:14 pm
http://www.sfgate.com/bayarea/article/Hercules-in-hot-water-over-financial-records-3550670.php
http://www.sco.ca.gov/Files-EO/Hercules_RDA(1).pdf
http://www.contracostatimes.com/news/ci_20593342/state-audit-blasts-hercules-financial-practices-more-reports
Comment by John — December 19, 2012 @ 12:27 pm
I don’t know if this is good news or Bad news.
In 2008 and 2009, as a planning consultant for Hercules, Warmerdam was project manager for the 2009 Updated Redevelopment Plan.
http://pinole-hercules.patch.com/articles/city-council-faces-herculean-problems
“Since June 2009, the Hercules Redevelopment Agency has paid Red Barn more than $3.1 million for consulting fees and expenses. Those expenses included almost $375,000 paid to a consulting firm owned by a Red Barn investor, $310,000 in legal fees – some of that for advice on how to respond to a subpoena of its business records — and tens of thousands more by the company’s subcontractors, who received reimbursements for expensive Apple computer monitors and music from the Apple iTunes Store. Red Barn itself billed $300,000 in fees and $139,000 in expenses. It is unknown how much Red Barn billed the Agency between May of 2008 and January of 2009. In May of 2008 Red Barn signed a contract with the Development Agency to manage construction of the BART parking facility on Willow Avenue.”
Comment by John — December 19, 2012 @ 1:00 pm
She should fit right in…..This is the type of Up front honesty and integrity we need….I guess Russo ran out of a excuse generator and hired an assistant.
Deputy City Manager Liz Warmerdam said all the grant money can be accounted for, and the city is slowly fixing its financial problems.
“They think we’re hiding something. We’re not,” she said. “We’re just understaffed.”
“We don’t think (the tax) is enough to balance the budget. We’re pretty skeptical,” said Deputy City Manager Liz Warmerdam. “But it’s better than nothing.”
Read more: http://www.sfgate.com/bayarea/article/Hercules-teeters-on-brink-of-bankruptcy-3465592.php#ixzz2FYQwEX00
Comment by John — December 19, 2012 @ 6:21 pm