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HACM presents reconciled 2023 financial statements; CFO flags "going concern" cash shortfall and vendor-payment risks
Summary
CFO Brad Kalik presented reconciled financial statements for 2023, disclosed a "going concern" qualification due to current liabilities exceeding current assets, and said the authority made a $500,000 pension payment March 31 while working to prioritize payments to small local vendors.
Brad Kalik, HACM chief financial officer, presented the authority—s reconciled 2023 financial statements to the board on April 9 and outlined a series of steps the finance department has taken to improve controls and reporting.
Kalik told the board auditors have the reconciled statements and are asking follow-up questions. He said the authority has strengthened internal controls and is training finance staff on Yardi, the agency—s accounting and property-management software. Kalik noted the agency made a $500,000 pension payment on March 31, 2025, and described progress toward more timely pension funding in 2026.
Kalik said the 2023 statements likely will include a going-concern note because HACM—s current assets at year-end were less than current liabilities. He explained in plain terms that if HACM were forced to liquidate all assets at that date it would not have had enough cash to cover all liabilities. Kalik and other staff said that, while they are working to improve cash flows, there remain short-term vendor-payment issues that disproportionately affect smaller, local contractors and mom-and-pop firms that supply day-to-day services.
Commissioners asked about vendor lists and payment prioritization. Kalik said the authority has identified a top-25 list of local vendors whose service continuity is critical and that the authority has negotiated extended payment terms with larger corporations while trying to prioritize payments to smaller vendors. He said about 60% of vendors are local mom-and-pop or midsize businesses and estimated those vendors account for 25—2% of non-utility, non-payroll costs. Kalik and staff said they have met with the city comptroller to clarify prior check handling and have cleaned up several reconciliation issues.
Kalik credited prior investments in Yardi and recent staffing and process changes for helping the authority produce reconciled financial statements for 2023. He said auditors have the statements and that one of the sustainability-plan milestones is timely audited financial statements for 2024 and a board-ratified audited 2024 statement by September 30, 2025.
No formal board action was taken; commissioners asked for continued updates and requested a vendor list so they can better understand vendors the authority relies on for operations.
