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Riverdale mayor blocking bank note, may force use of reserve money

By Justin Boron

The Riverdale City Council ensured that the city could pay its bills and employees for another 10 days on Friday night after the mayor blocked a loan the city needed to continue operating its government.

Faced with rumors of furloughs and the possibility of being unable to write checks, the council allowed the finance director to pull $287,000 from reserve funds if Mayor Phaedra Graham doesn't sign off on a $1 million line of credit by 1 p.m. Monday.

Council members and city officials could only speculate and provide second-hand reasons as to why Graham wouldn't sign off on the tax anticipation note. The note would be used to operate the government until property tax revenue begins to arrive in October.

Graham did not attend a called meeting Friday and did not return phone calls to her home.

City Manager Iris Jessie said in speaking to Graham, the mayor had concerns about taking out a loan to cover expenses.

While governments often embrace this financing technique, Riverdale has not used loans in this fashion in its immediate past.

Several council members and city officials asked why those concerns were not alleviated during months of budget discussions.

Asking Jessie her opinion, Council member Michelle Bruce said, "By the mayor not signing this document, she has put the city in jeopardy?" Jessie said she would not use the word "jeopardy."

Riverdale faced a difficult budget season this year. At the expense of its employees, the city was forced to cut costs to avoid using money from the reserve fund to run the government, which it now may do.

Tom Pence, the city's finance director, said the tax anticipation note may not have been necessary if collections of fines had not shrunk so tremendously in the last year.

If the city draws on its savings, it could lose some interest on the money, he said.