Mayor Dan Sullivan's top finance executive wants city department heads to guarantee in writing that all their expenses and revenues for this year are accurately accounted for.
In memos sent to the department directors last week, Chief Fiscal Officer Lucinda Mahoney said she wants signed "management representation letter(s)" on her desk by early February certifying that all 2009 financial transactions "have been properly recorded and/or disclosed."
Mahoney and Sullivan have said several unrecorded financial obligations or accounting irregularities have surfaced since the new mayor took office in July. Among those, Mahoney says in an e-mail sent to department heads on Wednesday, are about $3.6 million in unpaid invoices not turned in on time.
Also, Mahoney said in an interview, some $595,000 in interest on a 2006 loan from the city's electric utility to a city agency for a land purchase in Muldoon was deferred instead of being paid when it should have been, and old, uncollectable bills for ambulance services from 2006 and 2007 were still on the books as potential revenues this year. In some cases, verbal agreements had been made where one city entity didn't have to make lease or interest payments to another, she said.
"I just don't want any verbal deals," she said. "If I have a problem going on, I want to correct it."
Mahoney said the sort of management assurance she's asking for is a common practice in the private sector, although it may be unusual for city government. Prior to joining Sullivan's administration, Mahoney worked as a manager for Arctic Slope Regional Corp. and Arco and as a consultant.
"I saw no reason not to do that here," she said. "We wanted to make sure that every potential liability for 2009 is recorded. ... The overall objective here is just to get directors to think about, 'Have I got everything recorded in 2009?' "
What happens if something gets overlooked and an unrecorded expense turns up at mid-year?
"We'll sit down and talk with them about it and find out why it happened," Mahoney said.
Sullivan said he thinks the management guarantees are a good idea. "Clearly, it should be a standard practice in the city," he said.
By DON HUNTER
dhunter@adn.com