City Finance Director Defends Performance

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At a previous council meeting Manvel’s director of finance was accused of inadequately administering her responsibilities.  Most notable among the denunciations and receiving the bulk of discussion among city council was the assertion by the city’s auditor, and affirmation by the city manager, that monthly bank reconciliations had not been done since late last year.
Phyllis Herbst took the opportunity to defend herself at last week’s council meeting.  Reading from a prepared statement, she first reiterated what the auditor affirmed that the audit resulted in a clean opinion; no indication of impropriety was present.  She pointed out that such has been the case in each of the 11 plus years that she has been contracted by the city.
Herbst took issue with the audit report being presented to council prior to her reviewing it.  If given that opportunity, she says, she would have been able to answer the concerns.  Herbst insinuated that the auditors did not care to discuss with her “the bad things she had done” and felt the need to “bring them out in the open.”  She accused the auditor’s presentation of being contrived and deliberate “to make council question my ability to oversee the city’s finances, opening the door to changing finance directors.”  She went on, “In the blink of an eye a stranger walked in without adequate knowledge of the subject and with a few words and the assistance of the media tarnished my reputation and ability to perform the city’s accounting.”
The “stranger” Herbst apparently refers to is Chris Breaux.  He has performed the city’s audit since at least 2005 and one would assume he is familiar with the city’s finance department, its personnel, and its procedures.  In considering the media complicit in her adversity she fails to acknowledge that she declined an opportunity to respond to the issues before the previous story in this paper was submitted.  She likewise declined to provide any comment for this follow-up article.
In her presentation Herbst went on to explain several numbers and accounting procedures contrary to the auditor’s conclusions, in effect accusing the auditors of shirking responsibility in catching errors and ensuring that everything was reported properly.  She did concede an error on her part but claimed it worked in favor of the city and was not of significance due to the small dollar amount relative to the overall budget.  “These items were not presented in a very good light” and “could be really bad things if you don’t have all the facts,” she said.  Herbst says she was “not asked about these items nor given a chance to respond before the presentation.  There was no support from management.”  She proceeded to castigate “management”, presumably meaning the city manager, as possessing insufficient knowledge to adequately respond to auditor’s questions due to the fact he is not a CPA and does not possess the broad knowledge of the city’s finances as does she.  “If the appropriate questions had been asked by management, certain conclusions would not have been made,” she suggests.
Regarding the undone bank statements, Herbst claims they were completed but simply not printed.  She says the auditor was resolutely uninterested in allowing her the opportunity to produce them prior to the presentation.  “I never gave it another thought” and “didn’t realize people would think that we really had not been reconciling the accounts at all,” she said.  Herbst went on to declare that the day following the disparaging report to council the city’s bookkeeper, Brenda Derouen, printed out the reports and spent some five hours reconciling the August 2014 statement.  “There was no way Brenda could have reconciled all those months in less than two days if they had not already been done.  It would have taken at least a week to reconcile each month from start to finish.”  Derouen’ s comments at the previous council meeting seemed to confirm the auditor’s claims that reconciliations had not been done, which she blamed on a change in accounting software.  Later comments on her part, however, indicate reconciliations had been completed through April on the computer and that subsequent months had been done manually.
On the lateness of this year’s audit, Herbst explains it as too many demands placed on her and being directed to work on other needs.  On assertions the lateness of the audit further delayed the long anticipated water and sewer infrastructure project along Hwy 6, Herbst declares that to be untrue and merely served as an appearance that she was responsible for the delay due to being “so behind on the work.”
Herbst believes the pretense of wrong-doing on her part was an opportunity by management to promote a change in finance directors.  Herbst is a contractor and not a city employee.  She likes that status, she says, “Because I enjoy a certain independence.”  She explained to council that two years ago she asked for help in the finance department and did so again in this year’s budget negotiations.  She admits the department has struggled to keep up with the increasing workload despite her increasing the hours she puts in, claiming to be at city hall “almost every day.”  She would like to see a part-time person about 60-hours per month added to the department to help with the day-to-day work.  “I need to be reviewing and directing the department,” she says.  Herbst would like to have equal opportunity as other city department heads to ask for new employees and make her own decisions about how to run the department.
Herbst feels “management desires another person,” and seemed to express irritation that the position had been posted for outside applications when other city positions have moved from contract to full-time without such posting.  She goes on to say that she has not submitted a resume because she does not feel it would be seriously considered.  She believes changes in the department are needed conceding her vision differs from what “management has planned.”  It appears she favors maintaining her contract status while employing lower level staff to take on more of the load.  She concluded her statement essentially leaving her position to city council discretion, seemingly wanting them to overrule “management” on wanting to hire a full-time director.
It is unlikely council will see things her way based on comments that suggest a general accord on the idea that it is time for the city to have a full-time finance director.  Member Maureen DelBello said, “Our city has grown so much that it is time we have a full time director that is there every day overseeing the department and handling items that need to be addressed as well as being accountable for our finances.”  Mayor Delores Martin feels “the time for commitment is now.  I do think it is time we hire a full-time finance director, whoever it may be.  If she or he has part time help, he or she would have to be here full time.”
Kyle Jung feels “the increasing amount of work in the finance department has demonstrated the need for a full time finance director.”  He went on to say that “any implication about plans to deliberately replace her (Herbst) are incorrect.”  On at least two occasions, according to Jung, inquiries to Herbst regarding her moving to a full-time position yielded her desire to remain a contract worker.
The auditor, Chris Breaux, was not present at the workshop as Herbst made her defense.  Asked later at the council meeting for his take on the matter he steadfastly denied there was or is any collusion to cast a bad light on Herbst and her department.  Mayor Delores Martin said she has known Breaux for many years and “I never had any type of problem before with him or his work.”  Neither the mayor nor other members of council that offered comment believe the accusation by Herbst that she was deliberately denied an opportunity to answer the issues presented.
Another agenda item at the meeting resulted in council putting off a decision on naming an auditor for next year.  Given the current conflict along with a desire to spend less money and the feeling among some on council that a fresh assessment of the city’s finances and procedures would be favorable, it appears likely the city will hire a new auditor when council next meets.
The city charter grants to the city manager the hiring decision on the finance director position with “the concurrence of the city council.”
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