---

City finance officials have reduced the amount of money to be borrowed to make up for a budgetary shortfall from $1 million to $650,000, city manager Terence Reidy announced at the Nov. 19 council meeting.

The council originally passed a resolution authorizing the city to borrow $1 million to make up the difference, but the state Division of Local Government Services investigated city finances and said the city could not borrow $1 million in a long-term loan.

Instead, the city has found $350,000 to transfer out of other line items to make up for the discrepancy, Reidy said. This reduces the amount to be borrowed from $1 million to $650,000.

The $650,000 loan will be raised in 2013, Reidy said, while the $1 million loan would have been paid off over several years.

If city officials find more opportunity to transfer budget funds, they will be able to make those transfers in the remaining two meetings of the year in December, city external auditor Dave Kaplan said. Such transfer resolutions “are typical in municipalities in November and December,” Kaplan said.

The emergency situation was made public in mid-August following the resignation of former chief financial officer [CFO] Juan Uribe. While putting together the budget, the finance team had apparently forgotten to include an additional $1 million in the health insurance line item, officials said. Officials disputed who was at fault until the Division of Local Government Services investigated and said they found no evidence of wrongdoing but ultimately found Reidy responsible for goings-on within the finance department.

“The silver lining is that we won’t have to pay $1 million over several years,” Reidy said at Monday’s meeting.

---