Tuesday, May 28, 2024

San Pedro Town Council presents financial report


The San Pedro Town Council (SPTC) administration has delivered a report on its financial status for the first time in many years. On Wednesday, January 24th, in a presentation highlighting transparency and accountability and how the current local administration manages the people’s finances, the local government headed by Mayor Gualberto’ Wally’ Nuñez presented the financial reports for 2021 and 2022. 2023’s audit will be released in October of this year if the current administration is re-elected in the March municipal elections.
The 2021 and 2022 audits showed debts inherited, overdrafts, a dysfunctional system, and how the current administration achieved financial stability. The presentations did not elaborate on details and just provided a concise overview of the essential aspects of the audit. But for those interested in the complete information, you can find the audits at https://shorturl.at/nprOV and https://shorturl.at/ekrtN.
The anticipated press conference started at 10AM inside the conference room of the Sunbreeze Hotel. Mistress of Ceremonies Natalie Arceo welcomed all attendees and introduced the head table led by Mayor Nuñez, Town Administrator Rene Guzmán, and Accounting Manager Angie Rosado. The presentation unveiled the state in which the current administration founded the town council when they took office in March 2021. Rosado explained that there were unverifiable balances and poor to nonexistent accounting procedures. She added there was also no essential information available and no reference point for financial transactions. Rosado also mentioned that there were loans without indicating how they were used.
Mayor Nuñez pledged before coming into office that he would produce a yearly financial report; however, with the issues they found at the beginning of their administration, the audit was delayed for over two years. The audits for 2021 and 2022 were not complete until August 2023. The Mayor explained that although they did not have enough resources, there was a responsibility to move the town forward against the challenge of overdrafts in the banks, debts, and loans.
Unpaid Loans
The report details a government loan from 2011 for $1.5 million with an interest rate of 9%. The administration at that time defaulted on the loan, so the government withheld the monthly subsidy to apply towards the loan. According to Mayor Nuñez, they are currently in negotiations with the current government to write this debt off. The second loan exposed was obtained from a private individual in August 2012 for $300,000 with an interest rate of 8%, payable in monthly installments of $3,639. The loan was refinanced five times over eight years. Since 2023, Nuñez has made timely payments and reduced the balance to $237,653.
Banks and Income Tax
As per the audit, Nuñez’s town council inherited two overdrafts. One with Atlantic Bank for -$44,506, and -$142,335 with the Belize Bank. The Mayor said these were cleared within four months after proper accounting, and since June 2021, there has been no need for an overdraft. In the case of income tax, deductions were made from employees (2019-2020) but never submitted to the tax department. The audit shows that the total owed to the department, adding the totals for employees, interests, and penalties, is $222,859.51. The current town council has managed to negotiate a $10,000 monthly payment.
Vendor Balances
The audit showed that $301,185 was owed to Caribbean Depot for street material for paving a street by the San Pedro High School in June 2019. The SPTC now makes weekly payments, and the debt’s balance is now $168,185. Medina’s Construction also sent in their bill for $95,194.59. The SPTC has already paid $90,000 towards this balance.
The other debt the SPTC faced was a $377,775.67 bill from Caribeña Fuels. As per the audit, this debt started in 2018 and expanded to 2020. After making arrangements, the report shows that weekly payments of $2,000 are being made. The balance now stands at $108,661.07.
Mayor Nuñez clarified that his administration has a good working relationship with these companies because there is no longer a high-risk town council. The Mayor said that they focused on targeting some of their goals while taking care of all these responsibilities. However, they did not have the funds to work on structural projects. Through the attraction of innovative investments, Nuñez started acquiring new equipment, upgraded their operational systems, and even secured funds with assistance from the central government to reconstruct the old Sir Barry Bowen Bridge at Boca del Rio. The next step has been paving 7.5 miles of roads involving the main streets across all subdivisions. According to the Mayor, they are raising municipal bonds to finance these projects, for which investors can provide their input to help the town’s development. Nuñez said that because of their management, they could attract more bondholders and other investments for urbanization projects like the recent plan unveiled for the San Mateo subdivision. “We have completely transformed this town’s finances, and we have achieved financial status in record time,” Nuñez proudly said.
Accountability and the way forward
Town Administrator Guzmán added that it has been a journey to get to where the administration is today, stating that they have installed better software systems that track receivables, established a fixed asset register, and created a finance and revenue department. He pointed out that the previous local government’s computer software to record its receivables for payments, such as property tax, trade licenses, etc.., could be easily manipulated without a trace. This has been addressed by installing a new NEO Municipalities Software program that allows internal controls. Regarding the cashier receipt books, Guzmán said this system has changed from documented hard and soft copy receipts to electronic. In contrast to the Excel program, he said, which was also used for cash closeout reports, they are using the same NEO Municipalities Software, which provides a detailed breakdown of revenue collections. The program also allows for proper reconciliation, for example, of bank and vendor accounts. In addition, he noted that the town council has new financial partners.
While the audit breakdown provided all the numbers showing the finances of the SPTC, the presentations needed additional details, and the Mayor was not ready to speak about specific topics, like how many new vehicular permits have been issued since they came into the office. Residents believe there has been an increase in vehicle importation and want to know how much funds have been collected in permit fees. The other matter the Mayor was not ready to elaborate on was the details of the municipal bond.
Mayor Nuñez said these topics would be discussed in the following financial report targeted for October of this year, stating that the report would include internal and external audits, reports on enhanced internal controls, details of revenue collection, expansion of services, and what strategic investments have been acquired for the town’s development.

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