Finance committee hears warnings on audits, reconciliations and market access; consultants proposed to catch up accounts

Holyoke City officials and outside consultants briefed the Finance Committee on Oct. 15 about long-running problems in the city’s financial reporting, missing reconciliations and delayed audits that have affected state aid, bond-market access and credit ratings.

Treasurer Rory Casey and outside consultants TJ Plant of Open Architects and a data lead named Cinder told the committee that multiple audits and reconciliations remain incomplete, contributing to the Commonwealth’s Division of Local Services (DLS) interventions and to credit-rating pressure from Moody’s and other agencies. Casey described a pattern stretching back years. “For 6 of the past 8 years, the city has been late in filing its schedule a. 5 of those years resulted in local aid being withheld,” he said, citing longstanding DLS findings.

Consultant TJ Plant said Open Architects’ team has received the city’s financial data and will attempt to reconcile bank statements, the cash book and Munis/Xero records, potentially automating reconciliations and producing exception-based reports. “We are fully prepared to do this. Our contract is in final draft,” Plant said.

Cinder told the committee the city currently lacks “ready market access” and that the 2023 audit remains open with a disclaimer of opinion from auditors; the absence of timely audits prevented Moody’s from maintaining a rating and left the city without normal access to bond markets. Cinder said the city had $32,000,000 in short-term notes that were renewed for a year using a state program (qualified bond act / state-aid intercept) and that long-term market access remains constrained until audits and reconciliations are completed.

Committee members repeatedly urged transparency and independent verification. Councilor Juan Jourdain and others said they want a qualified appointed treasurer in place, and several members urged the state or an independent reviewer to be used to certify reconciliations. Councilor Mike Graney and others pressed for concrete timelines and asked why outside auditors had not caught the problems earlier.

Treasurer Casey and Auditor Tanya Dobiak described work already done: Casey said 2023 reconciliations were largely completed and given to the outside audit firm (now in draft), while 2024 work is partly done and 2025 remains to be started. Casey said 2023 reconciliation work was “in the nineties” percent complete; for 2024 he judged progress in the “seventies to eighties.” Auditor Dobiak said the city has provided audits and reconciliations to outside auditors and that questions remain but “work is currently happening.”

Several councilors urged a pragmatic, stepwise approach: appoint a qualified treasurer as the city’s ballot question provided, engage Open Architects to perform the reconciliations and data automation, and implement structural reforms such as a centralized finance director (CAFO/CFO) to ensure long-term reporting and control. TJ Plant and others gave salary ranges: a municipal CFO around $150,000–$200,000 and a treasurer $110,000–$150,000.

The committee voted at the meeting’s close to record that items 3, 4, 5, 6, 7, 9 and 10 (related to DLS communications, the Open Architects contract and reconciling filings such as Schedule A and free cash certification) “have been complied with” and approved receiving the mayor’s supplemental budget item for later review. The committee did not vote to appoint a treasurer during the session; councilors said an appointment and ordinance steps remain to be scheduled.

Committee members and the mayor repeatedly warned of political rancor around the reforms but said the immediate priority is completing reconciliations and finalizing the 2023 audit so state reporting and rating access can be restored. Open Architects said it will examine the data immediately and report findings to city leadership and the committee; the scope and final contract remain in draft form.