Palmer finances in good shape as new city manager takes over

Palmer got a clean audit for its finances, its city council was told Aug. 27. This means new Palmer manager Stephen Jellie takes over a city in good financial shape.

Last Tuesday was Jellie’s first council meeting after being on the job for eight days, having been named to replace former manager John Moosey, who retired. Mayor Steve Carrington asked the council to join him in welcoming Jellie and his family to Palmer. He and his wife have two young boys. A welcoming reception was held at The Depot in Palmer last Wednesday.

On the financial report, auditor Joy Merrimer said, “There are no items of concern to bring to your attention and no items to be corrected.”

Merrimer presented a 143-page audit document to the council and hit highlight during her presentation.

City revenues were about $17 million and were balanced again about the same level of expenditures, Merrimer said. Jellie told the council that it should decide what level of uncommitted funds are appropriate to be held in reserve, as a fund balance.

There was fund balance, or reserve, of $14 million at the end of the 2023 financial year, Merrimer said, but about half of this is held to advance operating funds to city enterprises, like the Palmer airport. The uncommitted fund balance of about $7 million is sufficient to fund city expenses for about six months.

The national Government Finance Officers Association recommends at least three to three and a half months of cash reserves be kept on hand as a fund balance but Merrimer said she feels a larger amount is more appropriate for Alaska, where there are unique conditions and emergencies created by weather and natural disasters.

“I would be uncomfortable with a fund balance under six months,” she told the council. Fund balances for municipalities and school districts are a hot topic in the state, particularly for schools, which are under pressure because of rising costs and static state funding.

Council member John Alcantra said the audit report show that Palmer’s city general fund expenses are 85 percent supported by sales taxes revenues with about 15 percent paid by property taxes. Mayor Steve Carrington said the audit documents will be posted on the city’s website.

In his manager’s report Jollie said he had spent much of his first week on the job in detailed one-on-one discussions with city council members, and the mayor, on priorities and problems to be dealt with.

In other business, the council dealt with routine matters. A water connection to a property outside the city limits was approved; city manager Jellie was authorized to purchase an Exmark Lazer Z lawn mower from Alaska Electric and Control, Inc., and Jellie was also authorized to issue a contract for additional interior demolition at the damaged Palmer Public Library to determine the full scope of structural damage. The contract, for $44,844, will be made with Steppers Construction, Inc.

In other actions, the council approved a resolution authorizing the city manager to allocate an additional $97,332 for additional work on lighting at the Palmer airport. Most of this will be eventually refunded to the city by the Federal Aviation Agency, the council was told.

In an interview, Carrington said he and other council members were aware of complaints about Jellie by workers in his previous job as fire chief in Jackson Hole, Wyoming, which also surfaced in social media in Alaska. Jellie had to cut budgets and trim the workforce and had a strict management style, which ruffled feathers with some in Jackson Hole.

Carrington also pointed to Jellie’s positive accomplishments in a previous municipal job in Ogdensburg, New York, which helped in an economic revival. In his mayor’s report he cited a Youtube video of that work, urging council members to watch it. It is at https://www.youtube.com/watch?v=xxhvTr4GCVg