GREENFIELD — A little more than $3 million in free cash remains in limbo as Greenfield looks to reconcile $1.97 million in variances in its cash books for the 2025 fiscal year.
The Ways and Means Committee voted on Tuesday to recommend that City Council hire Clifton Larson Allen LLP to reconcile the city’s cash books for FY25, at a cost of $75,000. Finance Director Stephen Nembirkow said balancing the books is necessary to get the city’s enterprise funds certified and maintain its bond rating, as well as to ensure future free cash can be certified and state aid can be issued.
Last month, Nembirkow and Mayor Ginny Desorgher informed the council that the state Department of Revenue had yet to certify the city’s free cash and retained earnings for fiscal year 2026 due to errors with documentation, transfers, payroll and vendor warrants. The news prompted City Council to rescind its previous votes approving 10 planned capital expenses that would have been paid for using free cash.
The errors occurred after the city hired new employees who did not have experience in municipal government to replace Treasurer Kelly Varner, Accountant Angelica Desroches and Finance Director Diana Parsons, who had all resigned in 2024.
“There was a six-month period where a lot of things that should have been done were not being done,” Nembirkow told councilors in June.
In a letter to the city, Department of Revenue Director of Accounts Deborah Wagner wrote that the lack of a treasurer’s cash book and cash reconciliation for FY25 and FY26 was concerning, and that if the books are not reconciled soon, it could result in state aid being withheld, the city’s annual audit not being completed and its bond rating being impacted.
“For FY2025, the city did not submit its Schedule A, which was due Nov. 30, 2025, until May 28, 2026,” Wagner wrote. “As a result, the city’s local aid payments from March 2026 through May 2026, totaling $2,899,389, were withheld and not released until June 8, 2026.”
The letter states the Department of Revenue identified $1.97 million in reconciling differences between the city’s Accounting Department and Treasurer/Collector’s Office. The FY25 budget that City Council had approved in May 2024 was $64.87 million. The state expects weekly updates from the city until the books are closed.
The Department of Revenue’s letter goes on to say that the state calculated that Greenfield’s free cash would have been $3,001,275 if it had been certified, and the state reserves the right to take corrective measures if necessary.
Desorgher said she hopes the cash variances between the Accounting Department and Treasurer/Collector’s Office are due to double postings of expenses, and that the Clifton Larson Allen team is prepared to begin work on reconciling the bookkeeping errors as soon as next week if City Council approves the $75,000 to pay the firm.
“Let’s get it done,” Precinct 6 Councilor Patricia Williams said.
Councilors asked how the city plans to prevent the errors from occurring again in the future, to which Nembirkow said staff are being cross-trained on roles so if one person is on vacation, sick or resigns, other staff members can complete the necessary tasks.
Desorgher said she believes the cash reconciliation errors occurred because when a replacement accountant and treasurer were hired, they did not receive training, since the entire Finance Department had left.
“When they left, I was begging people to show the next people what happens, and so I would say that was the reason why that didn’t happen,” Desorgher said. “Most of the time you have somebody in the position training and that did not happen. I called people who left that did not return phone calls. So they were learning as they were going.”
In her 2024 resignation letter, Varner wrote to City Council that she was concerned that the city’s plans to replace her and her staff were inadequate. Varner said she had left a list of what needed to happen in the job.
“All of us that are leaving are being replaced with people who have no municipal experience and are not really qualified to be doing the jobs they are being placed in. To date there is no replacement for myself or my staff, who also gave their notices shortly after they found out I was resigning,” wrote Varner, whose resignation was effective Sept. 20, 2024. “No one bothered to spend much time training with myself or my staff to be able to keep the operations of the Treasurer/Collector’s Office going. The current finance director was named as interim treasurer, but spent zero time actually learning my job. I left all the work in my office up to date, processes documented, along with a list of tasks and their due dates. Unfortunately, I don’t think that will be enough. I would be very concerned if I were in your shoes.”
In October 2024, the mayor had been questioned about how the city’s finances would be handled following the resignations, to which she said staff members were working late nights, holidays and weekends to ensure the finances were handled smoothly.
Ways and Means Committee Chair Marianne Bullock told Desorgher and Nembirkow that she would like to receive the weekly updates that are given to the Department of Revenue, and that at a future meeting, she would like Nembirkow to further explain the transition plan and how the city will deal with any future resignations for roles that deal with finances.
City Council is expected to vote on the $75,000 expense to hire Clifton Larson Allen at its meeting next week.
