With less than a month’s service as the city manager of Truth or Consequences, Bruce Swingle has ushered in good government procedures that reverse years of decision-making by staff behind closed doors instead of by city commissioners in open meetings.
Swingle infused T or C’s budget process with sunshine when, at a public budgeting session that took place on May 5—his third day on the job—he asked department directors to rationalize their proposed expenses to the city commissioners and informed the city commissioners that they were responsible for making the fiscal policy decisions inherent in creating a budget.
Yesterday, during the city commission’s May 26 meeting, Swingle introduced several agenda items that again sought to reverse the usurpation by previous city managers of the commission’s authority and fiscal oversight.
RESOLUTION DEFINING CITY MANAGER AND CITY COMMISSION POWERS
Swingle presented a resolution that laid out what spending and negotiation powers the city manager has “with respect to funds and contracts,” and, in the process, made clear what expenditures and agreements must come before the city commission.
“It is clear no lines have been drawn . . . and staff has been pretty uncertain historically,” Swingle said, referring to the lack of established parameters defining staff’s authority to make procurement and contractual decisions.
Swingle’s resolution states that the city manager is “expressly authorized to execute contracts” of up to $20,000 for personal property [any asset other than real estate], services and construction, provided these expenditures are in the current fiscal year’s budget. The city commission, on the other hand, must approve contracts for items and services valued higher than $20,000 that are in the budget. It is also the city commission’s duty to approve contracts that are not part of the budget, no matter what the value of the contract.
“All procurements,” states the resolution, must follow city “Purchasing Regulations” and the state’s Procurement Code. According to T or C’s Chief Procurement Officer Kim Saavedra, the city’s procurement rules mirror the state’s. In addition, the resolution requires “a certified procurement officer” to sign off on contract and purchases to ensure their “conformance with procurement code.”
The city manager may approve transfer of monies between a department’s various funds, the resolution states. However, any transfer from one department to another must be approved by the city commission.
Legal settlements of up to $25,000 may be authorized by the city manager. Swingle explained that, since city managers are usually at the negotiating table in legal disputes, most attorneys assume the manager can negotiate up to this amount, which is the highest deductible of legal-insurance policies. All other legal settlement authority is retained by the city commission.
The city manager may apply for grants, but resulting awards must first be approved by the city commission before they are accepted.
All memorandums of agreement or understanding, as well as joint powers of agreement, must be reviewed by the city attorney before the city commission exerts its sole authority to enter into these agreements.
The city commission approved the resolution unanimously.
Mayor Pro Tem Amanda Forrister commended Swingle for adding “checks and balances and transparency” to procurement and contracting processes.
REIMBURSABLE GRANTS ARE STRAINING CITY’S LIQUID CASH POOL
On the agenda as a discussion item was a $1.2 million grant awarded MainStreet Truth or Consequences by the New Mexico Department of Transportation to renovate Foch Street between Main and Broadway streets. Swingle advised the commission that it is a “reimbursement grant.” In other words, he explained, the city has to come up with the cash to do the project and then grant monies will be disbursed based on receipts and proof of work.
“This will be hard for us to pull off with our cash problem,” Swingle said, illustrating that, unlike his predecessors, he intends to guide commission decision-making by providing pertinent financial information.
“The city already has a lot of reimbursable grants,” Swingle added.
Mayor Pro Tem Amanda Forrister asked if acceptance of the MainStreet grant should be “postponed.”
The grant, Assistant City Manager Traci Alvarez pointed out, had already been accepted by former City Manager Morris Madrid.
City Attorney Jay Rubin confirmed that the grant “was already executed.” In any case, Rubin elaborated, no action could be taken, as the grant was on the agenda for discussion only.
Forrister asked how long it would take for NMDOT to reimburse the city. In her past dealings with the agency, Alvarez replied, “they are pretty quick to respond.”
In the future, Alvarez said she will consider “what we can float,” in terms of up-front cash, noting that projects initiated by the Senior Joint Office on Aging also use city cash that is reimbursed later.
TOO MANY LOANS
Over the past two years the commission has not been given a comprehensive overview by staff of the city’s capital projects priorities. Project grants/loans and bond refinancings have been largely rubber-stamped by the city commission, with no questions asked about their impact on the city’s debt or ability to cover repayment. In Swingle’s first month, he has provided context and guidance to help the city commission set capital priorities.
At the May 5 budget meeting, the commission agreed that replacement of one of the city’s two 60-year-old electrical transformers is a top priority. The estimated cost has varied from $1.6 million to $1 million.
In the period since the budget meeting, Swingle determined that T or C “has too many loans already.” Nevertheless, he informed the commissioners on May 26, the need to replace the transformer is so urgent, his administration is seeking a loan from the New Mexico Finance Authority. The electric department’s profits are too high to qualify for grants, Electric Department Director Bo Easley had explained during his May 5 budget presentation.
Even though the city commission cut $1.8 million from the fiscal year 2021-2022 budget at the May 5 meeting, the cuts were not sufficient to cover the transformer-replacement cost, as evidenced by Swingle’s NMFA loan negotiation.
Commissioner Frances Luna stated on May 5 that $3 million needed to be cut from the budget, grasping the implications of Swingle’s explanation at the time that the transformer replacement was urgent.
Swingle said he would keep the city commission informed about the NMFA loan negotiations.
LEGAL SERVICES WILL GO OUT TO BID, ALTHOUGH BELATEDLY
Swingle is familiarizing himself with the expirations of existing city contracts and has run up against a tight deadline.
Swingle acknowledged that the city’s legal services contracts “have to go out to bid,” but also pointed out that there is not enough time to go through the bidding and award process by the time the existing contracts expire.
The city’s contracts with City Attorney Jaime (Jay) Rubin and John Appel, an associate attorney with the Coppler Law Firm of Santa Fe, expire at the end of June, Swingle said.
Both are four-year contracts. State procurement code 3-1-150 states that no contracts for professional services may exceed four years, “including all extensions and renewals.”
Rubin acknowledged that his four-year contract “ended February” and “it was extended from March 1 to June 30.”
Without guidance from Swingle that contract extensions are not allowed, the city commission granted Rubin a second extension on his contract, from July 1 through Sept. 30, and Appel his first extension for the same time period.
“We will use legal services quite a bit in the near future,” Swingle warned the commissioners.
$36 MILLION TO BE SOUGHT FOR WATER/WASTEWATER INFRASTRUCTURE
Although past city managers have opined the city’s water and wastewater infrastructure is in bad shape, Swingle is the first to act on the realization that the 50-year-old systems have hit the critical point where they must be replaced rather than continuously repaired.
Having evidently conferred with Wilson & Company, the city’s on-call engineering firm, Swingle reported that about $36 million should be spent on new water and wastewater infrastructure. By seeking money for concurrent repairs to both systems, Swingle also recognizes the city will save millions in labor, equipment mobilization and street resurfacing. The previous administration tackled infrastructure replacement in separate, piecemeal projects.
Swingle said he’s already in touch with possible granting agencies, but told the commissioners that he was not yet ready to “divulge who they are at this time.”
Swingle is also the first city manager in 15 years or more to insist that the practice of transferring utility fee revenue out of department budgets and into the General Fund to pay for deficit spending must stop. He told city commissioners during the May 5 budget session that the practice is leaving the utilities without money to spend on upkeep and repairs.