July 21, 2024
Where is the Bangor Annual Report?
The City of Bangor's failure to produce a mandated annual report for Fiscal Year 2023 is a violation of the city charter. This article explains why.

In 1931 Bangor voters approved a new charter for the city that switched us from a Mayor-Council system to a Manager-Council system. July 1, 2024 marked the start of Fiscal Year 2025 and the first time in our 92-year history under this form of government, the City Manager has failed to deliver an annual report during the previous fiscal year. This is significant because the Annual Report isn’t optional. It is required by our City’s Charter.

To prepare and submit to the Council as of the end of the fiscal year a complete report on the finances and administrative activities of the city for the preceding year and to cause the report to be printed for distribution to interested persons.

Bangor City Charter, Art. VII. Sec. 6(g) Powers and Duties of the City Manager.

In question is the Annual Report for Fiscal Year 2023, which ended on June 30, 2023. Typically, the City Manager delivers the Annual Report by December of the same year. Fiscal Years 2022 and 2021 were later, having been delivered in March of the following year. On July 1, 2024, a new fiscal year (2025) began, with no annual report for 2023 provided as of yet.

Annual report. Prepare and present to the Council an annual report of the City’s affairs and such other reports as the Council shall require.

Bangor City Code, § 28-21 (D) City Manager.

How did this happen?

At the heart of this issue is the City’s yearly required audit. In 1982 the city of Bangor switched from using a calendar year for financials to using fiscal years that run from July 1 to June 30. Audits are typically completed within months after the June 30th fiscal year end, which allows for the Comprehensive Annual Financial Report (CAFR) to be completed and presented to City Council and the public by December.

Why was the audit late for Fiscal Year 2023?

This year the audit was significantly delayed, with City Finance Director David Little citing staffing issues both in Bangor and with the city’s chosen auditing firm, Runyon Kersteen Oullette. He first alerted City Council about the delay during a Finance Committee meeting on January 8, 2024. From then on each subsequent meeting pushed the delivery date farther and farther back.

49 second video of City Finance Director David Little stating the audit delivery time frame at various meetings, and then pushing it back at subsequent meetings.

Is the audit required for the Annual Report?

No. In years past the city would issue the Annual Report, as required by the Charter, and then issue what we now know as the CAFR after the audit was completed. The audit is a separate process required by the Charter under Article VIII, Section 2.

At some point in Bangor’s history in the late 60s they decided the CAFR was enough to satisfy the “Annual Report” provision of the Charter and only issued the audited financials. The last copy of the old-style annual report that I was able to locate was from 1965.

The City Manager could have gotten an Annual Report out to satisfy the Charter. She did not.

The Annual Report is one of seven key duties assigned by the Charter to the City Manager. When it was apparent that the audit was going to be delayed, the City Manager should have produced a finalized copy of her draft report minus the typical letter of certification from the auditor. She then could have put out the CAFR later, with the certification, when the audit was complete. (The lateness of the audit, is another matter to be addressed in another article.)

Both the City Manager and the City Finance Director have expressed their confidence in their draft numbers. In fact, that is what they provided to the City Council to work with during the budgeting process in lieu of certified financials. There was nothing stopping the City Manager from publishing an Annual Report on time and in compliance with the City Charter. This was either a choice to ignore, or a failure to prioritize a Charter mandated duty.

Fallout and Potential Consequences of the Delayed Annual Report

The failure to produce a timely Annual Report for Fiscal Year 2023 has already had tangible consequences for Bangor’s governance, with the potential for further repercussions if left unaddressed.

Immediate Fallout:

Unprecedented Budgeting Process: The City Council was forced to make critical budgeting decisions without the benefit of a comprehensive Annual Report. This departure from standard practice potentially compromises the accuracy and effectiveness of the city’s overall financial planning.

Potential Future Consequences:

  1. Reduced Public Oversight: The lack of a timely Annual Report significantly hampers residents’ ability to scrutinize the city’s financial decisions and performance. This reduction in transparency could lead to a less informed citizenry and weaken the public’s role in local democracy.
  2. Delayed Detection of Issues: Without a comprehensive report, financial or operational problems within the city government may go unnoticed for extended periods. This delay could allow minor issues to escalate into more significant challenges.
  3. Erosion of Public Trust: Repeated delays and violations of the City Charter risk eroding public confidence in local government institutions. This loss of trust could have long-term effects on civic engagement and community relations.
  4. Setting a Dangerous Precedent: If this violation passes without significant consequence or corrective action, it could set a precedent for future non-compliance with Charter requirements, potentially undermining the effectiveness of the Charter itself.
  5. Potential Impact on City Services: While indirect, the lack of a timely, comprehensive financial review could affect the quality or efficiency of city services. Without a clear picture of the previous year’s performance, it becomes more challenging to make informed decisions about resource allocation and service improvements.

The cumulative effect of these consequences underscores the critical importance of the Annual Report. It’s not merely a Charter requirement, but a fundamental tool for maintaining transparency, accountability, and effective governance in Bangor. As residents, it’s crucial to recognize these potential impacts and advocate for prompt corrective action to prevent further consequences and restore faith in our local government processes.

There’s still no Annual Report for 2023, so what happens now?

As of right now? Nothing. City Council has not indicated any plan for addressing this Charter violation. They are content to wait until whenever it is that the audit gets completed, and then subsequently wait for the Annual Report to eventually get delivered to them. As of this writing, we have no indication when we’ll ever get the Annual Report for 2023. End of July? August? Heck, maybe we’ll get a 2-for-1 special in December with both 2023 and 2024 coming out at once. That is, if 2024 doesn’t fall into the same trap as Fiscal Year 2023 did.

City Council and Management have pledged that subsequent years will be better. They’ve taken no action to ensure this. One would think there would be a flurry of activity to pass an ordinance under Chapter 28 of the Code to codify a firm due date for future reports. Council Leonard requested an after-action report on all of this during the June 17th Finance Committee meeting, but no motions were made to bind staff to that action.

In short, the City’s plan is to simply have all of us take their word for it that this won’t happen again. Based on the track record of lateness of the past 3 years, excuse me for wanting that in enforceable writing. But then again, it was already in writing. In the Charter. The people who should care the most, have cared the least.

Isn’t there a consequence for violating the Charter?

Not within the Charter itself. There is nothing in the Charter that is triggered if a key provision is violated. When it was written, it was assumed that the City Council would provide that accountability. Other than a finger wag, they have not.

Since the City Council has not taken action, a citizen of Bangor could potentially file a lawsuit against the City in court, alleging a violation of the charter. If successful, the judge might rule in favor of the plaintiff and order the city to produce the report within a reasonable timeframe. Ignoring such an order could lead to further legal action, including fines or even contempt of court charges.

What can we, as residents of Bangor do?

Just as the City Manager is accountable to the City Council, the City Council is accountable to the residents of Bangor. We have to keep pressure on our elected officials to correct this. We need to demand action.

We should all write City Council to demand:

  1. Pass a resolve at the next City Council meeting to set a 15-day deadline for completion and release of the Fiscal Year 2023 report.
  2. Pass an ordinance setting December 31st following the end of the Fiscal Year as the permanent deadline for all future Annual Reports.
  3. Demand the City Council launch a public investigation into the reasons for the delay in producing the FY 2023 report. The findings should be made available to the public.
  4. Demand the City Council initiate a review of the city charter to explore strengthening accountability measures for future violations, particularly regarding transparency and reporting requirements.

Why the Annual Report is important to all residents of Bangor

Our city should never have anything to hide from us. Transparency is key and all affairs of the city should be laid out for inspection by its residents. The Annual Report serves to demonstrate where our tax dollars are going, how our city is serving us, and invite us to demand better of our city when it is warranted.

The Manager-Council form of government demands this transparency for proper oversight. The City Manager serves at the pleasure of the City Council, and it is City Council’s duty to hold the City Manager accountable in his or her responsibilities assigned by the Charter. As voters, the Annual Report is one of the ways the City Council acknowledges its accountability to us.

This has been recognized by City Managers across the years and summed up best by former City Manager Horace S. Estey.

“The intent of this report is to give the reader an insight into the affairs of the city and to furnish some idea as to the extent of the operations of the various departments. It is hoped that the brief statements given here will arouse the reader’s interest to the extent that it will prompt further investigation into the affairs of the City. Your management welcomes your suggestions as to how it may better serve you, and every official of the city will gladly give you any available detailed information that you might request.”

1943 Bangor Annual Report, City Manager Horace S. Estey