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OTTUMWA — City of Ottumwa officials owned the problem of its financial reporting doldrums Tuesday, and shared their hope that a clear path toward getting finances current is just around the corner.

During Tuesday’s city council meeting at Bridge View Center, the first meeting held in the building because of City Hall renovations, city administrator Philip Rath lamented several missteps that have put the city in a bind when it comes to its financials.

Yet, the city only seemed to bring this to light after the lack of transparency became a campaign issue for all four council candidates, including the two who will serve on the next council — Keith Caviness and Bill Hoffman Jr.

“I was hoping to report tonight that we had reconciled bank statements and accounts for each of the months for the previous fiscal year. Unfortunately, I’m not able to state that,” Rath said. “We’ve been working toward the completion of this information while maintaining daily operations.

“This issue has not gone unnoticed, and I’m committed to ensuring that we provide timely, accurate information to all of our stakeholders.”

The finance problems track back to well over a year, or ever since former finance director Kala Mulder resigned in early 2022. The city went 10 months without hiring a finance director until Waseem Nisar took over in October 2022, but an exodus of finance employees continued before then, including that of an accountant.

In the meantime, the city has contracted with three different people to help shore up accounting, which are past due with a yearly audit upcoming, as well as a new council beginning the budget process in January.

Despite the staffing shortages, which appear to be close to remedied with the hiring of an accountant, and soon-to-be hiring of an accounting specialist that would bring the department to full staff, the other main issue that was cited for the tardiness of reports has been a cumbersome accounting program that is decades old.

“If someone asked me what the most challenging job I’ve had is, this would top the list,” Nisar told the council. “We were learning on the job, learning the process. There are a lot of extra challenges to overcome.”

Ironically, according to council member Marc Roe, a new accounting system has been budgeted in past years, yet no action has ever been taken to obtain a new one.

Roe insisted the finances “haven’t been swept under the rug, and isn’t something that’s been ignored.”

“I can promise you a couple of us have been in Phil’s office over the last six months on a regular basis and he doesn’t like us coming in at all,” Roe said. “Conversations have been going on and will continue to go on.

“It is an accurate statement to say that we have arguably the most antiquated financial system in the state of Iowa,” he said. “But we’ve kicked that can down the road several times because financial systems aren’t glamorous. They’re just money spent and no revenue generated.

“We went through a particularly painful audit process last year and, subsequently, we lost our audit firm. We’re going to have an even more painful audit process this year, with a new audit firm.”

Early on in the process after Mulder left, the city contracted with local CPA Brad Barnes, then brought in a former finance officer from Clinton who was later a city administrator in Marshalltown. Much of the work of data entry, a big part of the finance department particularly with a system that doesn’t allow for bulk entry or importing, has been done remotely one item at a time.

Nisar said he has been working 10- to- 12-hour days, and on the weekends, while taking little vacation time.

“I’m fully committed to turning this around. I’m working as hard as I can, as much as I can.”

Rath said “there are a few things I would’ve approached differently” in the spring of 2022, when most of the problems began. “I would have begun the process of hiring the accountant position earlier,” he said. “The city was in the process of hiring the finance director when the accountant position was vacated, and the initial thought was to allow the new director to assist with the hiring of the accountant.

“Both the finance director and accountant had proven difficult to fill.”

Rath said the city’s annual finance report for the past fiscal year will be ready later this month, but also took steps to make sure the community is abreast on the city’s finances.

“One thing I can do is to add an item to the agenda for every meeting going forward, where I will provide a status report until such time we have accurate and current financial information, and a monthly report in which the city council is satisfied,” he said.

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