Petersburg firefighters leave as city’s first responders grow tired of calls for patience, promises of turnaround
By Michael Campbell, News Editor
PETERSBURG – As the city continues to deal with a multi-million dollar budgetary shortfall that has left residents wondering about the longevity of important public services, a glimmer of hope is on the horizon as Petersburg has received millions in short-term financing.
In a statement last Thursday, Petersburg’s Interim City Manager Tom Tyrrell confirmed the city was able to obtain $6.5 million of financing through Wells Fargo at an annual interest rate of 4.5 percent.
The $6.5 million in financing was part of key funding the city needed and part of The Robert Bobb Group’s plan to help Petersburg achieve short-term liquidity, which was presented to city council last month.
“This is part of the plan to provide short term financing to allow City functions to continue,” Tyrrell said in a statement, adding, “This figure does not begin to meet past obligations prior to this fiscal year starting July 2016. It does give us enough breathing room to continue to meet our current expenditures.”
It was revealed during the summer of 2016 that Petersburg was in debt over $18 million due to several years of fiscal mismanagement, resulting in the firing of a city manager and Petersburg hiring The Robert Bobb Group to help right the city’s finances.
As the city works to get back in the black, one thing that RGB said was a hindrance in getting the nearly $7 million in financing was an active lawsuit against the city levied by the South Central Wastewater Authority.
The authority, comprised of Petersburg, Colonial Heights, Chesterfield, Dinwiddie and Prince George, agreed to a settlement that ended the lawsuit as the South Central sought to collect past-due wastewater treatment payments which, at that time, exceeded $1.9 million.
According to officials, Petersburg’s past-due amount is now over $2.2 million, as of early December.
As part of the agreement with South Central and the city, the Wells Fargo financing can be used to make “a lump sum payment of approximately $1.2 million by Dec. 15, 2016,” which would be applied to the city’s delinquency, and the authority will work with the city “in good faith to develop a two-year payment schedule to redeem the city’s remaining delinquency while Petersburg continues to make “timely monthly payments” starting in December.
In a letter following the lawsuit settlement, South Central explained that the authority is “particularly dependent” on steady and timely payments from Petersburg, noting the city’s share of costs accounts for “more than half of South Central’s budget for operations and maintenance.”
In the authority’s FY2016 financial statement, “During the year ended June 30, 2016, Petersburg accounted for 57.85 percent of the authority’s wastewater flow,” noting the city “has faced significant financial difficulties in recent years.” As the authority discussed contingency funding, it noted that Petersburg, who at the time was behind on two months on payments and “continued to fall behind on payments subsequently to year-end,” and its inability to pay its member dues “would have significant effect on the Authority’s earnings and the ability to fund operations without using reserve funds.”
Through the settlement, South Central said it will be able to continue to provide wastewater treatment service “without imposing an additional financial burden on the customers and taxpayers of its other member localities,” including Prince George and Dinwiddie.
Along with paying South Central, Petersburg will use the $6.5 million infusion of cash to ensure they can make payroll for the remainder of the year and pay for “critical services,” such as their emergency communications system, critical maintenance and utility bills, federal and state funded services that haven’t been paid for and expenditures that have already been executed for the current fiscal year.
“This is not a quick fix to meet past debts from the City of Petersburg,” remarked Interim Deputy City Manager Nelsie Birch. “This short term loan allows us to pay our current fiscal 2017 expenses while meeting City payroll, current debt financing and emergency first responder services.”
According to the Petersburg International Association of Firefighters 2773, the city’s firefighters are “fleeing,” pushing the city “further into a public safety crisis” as the financial crisis continues.
On their Facebook page, the group explains that they believe “the city’s elected, administrative and fire department leadership has placed civilian and firefighter safety in jeopardy,” stating that there are failures to oversee OSHA regulations for firefighter safety, the loss of key breathing apparatus grant dollars, which eventually led to the equipment being repossessed by the vendor, the use of pickup trucks in place of fire engines and ladder trucks, failure to ensure working fire hydrants and a ten percent pay cut for the city’s firefighters.
“We are being asked for patience,” officials remarked. “Well, for a growing number, the risks are unacceptable. Especially when neighboring fire departments are hiring.”
IAFF 2773 added that “two more veteran fire officers” have left the city in recent days, with local media reporting that Petersburg fire chief T.C. Hairston stated he’s lost 14 firefighters since the city’s mandatory ten percent pay cut for all employees across the board.
“Regardless of plans or promises to upright the city’s finances, time for shoring up public safety is running out,” IAFF 2773 officials remarked. “Resolving pay issues, replacing worn out equipment and overcoming lost leadership will take years.”
“We are still in crisis mode,” officials with RBG explained. “This is not the time to interpret short term financing as long term accomplishment.”
The city plans to focus this “Phase One” loan on securing everyday operations and essential services over the next few months to bring the city to an updated financial position. “Phase Two” will begin in 2017 and, according to RBG, will focus on Petersburg’s long term debt.
“We need for the public and the vendors to be patient,” RBG said in last Thursday’s statement. “Our plan is working and we need cooperation from all to make it successful.”
Copyright 2016 by Womack Publications