City manager denies 'slush funds' allegation as residents question budgets, debt and yacht club spending

At the July 15 meeting several speakers accused the city of obfuscating budget decisions and maintaining undisclosed "slush funds," prompting direct responses from city officials.

Tom Shadrach and Jim Collier both raised concerns about reported surpluses or undisclosed funds in city accounts. Collier said he saw what he called "very unethical conduct" in FOIA responses related to litigation and urged that the city consider terminating the city attorney's contract when appropriate.

Council member Killray asked the City Manager to clarify whether "slush funds" exist. The City Manager responded plainly: "The city does not have any slush funds. All of our funds are audited annually by external financial auditors, independent single fund audit. We have audits from our operational audits, from our internal city auditor. No. There are, there are 0 slush funds in the city." Finance staff (Crystal) later explained that each debt instrument is accompanied by an established repayment plan — either covered by a covenant, pledged revenue source or specific funding such as gas tax or utility rates — and that repayment schedules are set before any debt is issued.

Speakers also raised concerns about a reported $1.1 billion city debt and questioned how the city plans to manage long‑term obligations; finance staff said each debt agreement carries a repayment plan and defined means of payment. Council discussion focused on emphasizing factual review and providing more documentation to address residents’ concerns.