Mayor Steve Prysunka says it’s a priority to better understand all of the borough’s financial accounts, a job that will be easier now that Wrangell has a full-time finance director for the first time since February.
Mason Villarma presented to the assembly at its meeting Tuesday night, explaining that the borough has created too many different fund accounts.
“The analogy is like a hoarder in a house,” the new finance director said. “We’ve created funds every year. There are thousands of accounts. A web that is incomprehensible.”
The accounting would add up the same but be more manageable with fewer accounts.
Villarma estimates Wrangell’s total amount of cash and investments in all funds at $35.4 million. That includes general government, reserves and self-supporting enterprise funds, such as the electrical department, port and harbors.
“What we are invested in and where the funds come from are two very different things,” Villarma said.
He already is compiling for the assembly a summary of all funds, which Prysunka said would be top priority for discussion at the next assembly meeting, dropping a U.S. Forest Service presentation from the agenda to make room.
Villarma proposed bringing in a consultant to help with the undertaking, noting that the finance department has been severely understaffed. The director position has been vacant since the end of February.
He has meetings with municipal finance directors in Petersburg and Juneau over the next week to learn from them and bring back more information to Wrangell.
Prysunka said in his seven years on the assembly, he has never been given a breakdown of all of the borough’s existing accounts.
After conducting walk-throughs with borough department heads, from the library to the port, and meeting with the municipality’s banks (Wells Fargo and First Bank), Villarma has suggestions on how to reduce redundancies and better manage the finances.
For starters, the borough has $13 million sitting in a checking account, which is not the best way to handle so much money, he said. A typical checking account for a municipality of Wrangell’s size should have no more than $1 million to $2 million, Villarma said.
Wrangell’s first fiscal priority is closing the books on a financial audit that has stretched on for 15 months.
“An audit is like a litmus test,” Villarma said. “If an audit stresses the system, it’s a failed system, from an accounting structure standpoint.”
Villarma came to Wrangell from Big Four accounting firm KPMG. He will present a more detailed summary of funds to the mayor and borough assembly members at the Oct. 12 meeting.
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