According to Pell City’s latest audits, the city’s finances are sound.

The crux of the audit is that the city’s coffers have grown by over $2 million in three years, yet the next year might see a decrease in revenue, mainly because of a sagging economy.

Audits were performed for the 2006-2008 fiscal years and are available to the public at the website: epell.net

“The numbers are sound for the short run,” Pell City Mayor William “Bill” Hereford said. “Basically, it says to me that our town has been soundly managed by the previous administration and I think that’s a good refection on Adam Stocks, who was mayor before me. I’m really proud of that for his sake and his council.”

The mayor said that the city would be doing its best to keep an eye on finances in the coming year.

“We’ve been doing pretty well, but in this ’09 fiscal year, our revenue is dipping,” Hereford lamented. “We’re not as optimistic about the year 2010 as we had hoped we would be. It’s just doesn’t look real good right now.”

Former Mayor Adam Stocks weighed in on the audits and how they reflected on his years in office.

“The audits came back exactly as we expected,” Stocks said. “They simply confirmed that at the end of my four years the city was left in strong financial shape.”

Stocks said that while 2010 looks bleak, there are glimmers of hope to look towards in the future.

“There’s still new retail and new residential growth that is being constructed across the city that are residuals from the four years I was in office,” Stocks said. “I thought it was a strong four years, we had tremendous retail growth and that’s backed up by the tax revenue increases. The industrial recruitment was as strong as it ever was and there were over 1,000 jobs created in Pell City during those four years. I think that Mayor Hereford is doing a very good job continuing the progressive mentality of the city and he’s got some tough times ahead of him. That’s no secret.”

The cost of the audits has raised some eyebrows, including that of the mayor. The initial cost was $329,000. But the mayor said the auditing firm “voluntarily” reduced the final bill.

Part of the initial high cost was due to the fact that the Birmingham firm Carr, Riggs and Ingram, LLC, who performed the audits, had to go back and sometimes re-construct situations to find out what was going on at certain times in years past.

“They spend a lot of time with us, but they did cut us a break in the overall bill,” Hereford said. “They did voluntarily reduce the price of the bill substantially because they could see how big it was. But it was far bigger than it should be. The bright side was that we had good audits. The downside was that we paid a lot of money to find that out. Now we are on top of our audits, so we need to get on top of our water system and we’re in the process of doing that but it’s not an overnight fix.”

Since the audit was conducted, a fulltime, certified public accountant has been hired to perform ongoing and future audits for the city.

One problem pointed out in the audit was the accounting for water consumption and how it was handled. A conservative estimate would be that 35 percent of the water the city produces is not accounted for.

Mayor Hereford, who oversees the water department, said that most of that is due to leakage in a system that is very old.

“We’re in an older system and we’ve got a lot of leaks,” Hereford said. “But we have a good crew that works with us and stays after it as best as they can.”

He pointed out that there is a lot of water that is used by the city that is not metered. He said that discrepancies like that will be looked into and taken care of before the next audit.

“We can’t account for that usage and we need to do a better job accounting for that,” Hereford said.

Hereford also said that there are “a lot of people who take a lot of our water—sometimes with permission and sometimes without—that goes unaccounted for. We had an incident just this past week where people were taking substantial amount of water form our fire hydrants without permission.”

The incident involved 20,000 gallons of water totaling around $6,000 dollars.

“We’re investigating that now and we intend to follow up about it,” Hereford said. “We don’t want to be monsters about it; but we want accountability. Water is a valuable commodity and we are very concerned about our water system. We have good people working there. But we’re not getting the revenue from it that we should and we have a lot of water unaccounted for.”

He said that Councilman Donnie Todd is deeply involved in the daily activities of the water department and said the two of them know that there is not a quick fix, but added, “we will fix it.”

Though he is optimistic for Pell City, former mayor Stocks expressed some frustration at the economic outlook of the current council and its inaction on the movie theater that was set to break ground last fall.

“The financial situation is going to be much tighter if the theater company pulls out,” Stocks lamented. “That deals with revenue and quality of life.”

When Stocks ran for mayor in 2004, the two things people told him they wanted were something to do and more places to eat. “If the theater deal falls through, then they both take a major hit,” he said.”

Stocks said he is “extremely disappointed in the lack of interest that city leaders have in keeping the movie theater deal alive. A year ago it was on schedule to start construction. The only thing I’ve seen happen on that site since that time was that the Porta-Potty was knocked over. I’m upset because we worked extremely hard and it took every bit of three years to find the right company that would take a chance on Pell City even though demographics and population numbers were not the right recipe that most movie theater companies were looking for.”

Stocks said that if further action is not taken then it might mean that the theater company will wash its hands of Pell City.

“There are talks of the sagging economy; but I don’t buy into it because ticket sales in the movie theater industry were up last year,” Stocks said. “I hope the mayor and all five council members are able to salvage the deal. I would not want to be known as one of the people responsible for Pell City losing its movie theater.”

He said that with new development coming to Leeds and Moody, including the Grand River project, that time is of the essence to get moving to re-secure the theater.

“I can assure you that if Leeds or Moody lands a theater and close a deal before Pell City’s theater is up and if there’s one ten miles down the road, Pell City will not get another movie theater deal in 15 years,” Stocks said. “The restaurants that you typically see around movie theaters would scrap their plans. This could be a positive or negative effect for Pell City. I’m sure the mayor and council will do the right thing. But right now I’m disappointed in the lack of interest in keeping the movie theater deal alive.”