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Right there in black and white?

Some misappropriations might have shown up as transfers on past city budgets

Published: Thursday, June 14, 2012 1:15 a.m. CST • Updated: Thursday, June 14, 2012 11:12 a.m. CST

DIXON – It doesn’t look like much, just another line in the budget.

But in the proposed budget presented at a workshop Wednesday evening, the line item referring to transfers to the capital development fund now reads “TBD,” or to be determined.

Past budgets submitted by then-Comptroller Rita Crundwell show, at their highest, more than $4 million a year being transferred to the capital development fund.

Most of the time, those transfers were in three lump sums in the budget. One for $3 million was the very last item in the budget of the department she headed.

Federal prosecutors say Crundwell funneled money through the capital development fund and into a secret account she opened in the city’s name two decades ago.

Crundwell is facing a federal wire fraud charge in connection with what prosecutors say is the misappropriation of more than $53 million.

Does the change mean she actually budgeted the money prosecutors say she misappropriated from the city?

The two interim finance directors from the city won’t say, but based on their assumptions, it looks like it.

“I can’t tell you what the other budgets were because I didn’t work off those,” said Stan Helgerson, who has been working on new revenue projections.

“We’re focusing on going forward,” added the other interim finance director, David Richardson.

For now, no money will be transferred to the capital development fund, because there aren’t funds available, Helgerson said.

“But ultimately in [fiscal year 2014], there should be some funds available that they would ultimately transfer out of general fund and into the capital fund to do capital projects,” he said. “But that would be for capital projects that would actually get done.”

Mayor Jim Burke, though, said those line items did represent some of the money that investigators say was misappropriated. Those budget lines were inflated, he said.

“Obviously, there was a shortfall in judgment in the whole thing,” he said. “That goes in the heart of the whole thing.”

But Crundwell’s name was noticeably absent during the budget workshop. She wasn’t mentioned once while Helgerson compared his budget projections to hers.

Helgerson’s revenue numbers came in about $600,000 higher than what the city had been previously working with. He attributed the increase to modestly higher estimates in sales and income tax revenue.

But the difference – and some other changes, including the removal of transfers to the capital development fund – puts the city’s budget in the black.

The city still has cash flow problems, especially in the sewer department, Helgerson said.

Unauthorized loans had been made from the sewer department, which is supposed to be self-contained, to the general fund, he said. Those loans, as well as authorized loans from the water department, are on target to be paid back.

“We’re starting in such negative positions that it’s going to take a while to catch up,” Helgerson said.

To attend

The Dixon City Council's next regularly scheduled meeting is 6:30 p.m. Monday in the council chambers at City Hall, 121 W. Second St.

Agendas and minutes are available at www.discoverdixon.org under "Citizens Information Center," or call City Hall, 815-288-1485.

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