After discovering about $178,000 in unpaid taxes, the city of Archer has hired a financial contractor and requested help from the county in an attempt to rectify the financial crisis. 

On Nov. 5, interim City Manager Deanna Alltop sent letters to Gov. Ron DeSantis and to the Joint Legislative Auditing Committee, notifying them that the city of Archer is in a financial emergency. 

The city owes approximately $178,000 in payroll taxes and does not have the funds to pay, according to Alltop’s letters. 

Alltop stepped into the position after the Archer City Commission fired City Manager Charles Hammond during an emergency meeting on Sept. 19 for misconduct after a citizen with accounting expertise looked into the budget and pointed out unexplained planned increases to the millage rate, an unbalanced budget, unapproved cost of living pay increases to his own salary and a failure to advertise the rollback rate. 

Employees also complained that Hammond had told them the commission had decided they must pay for their own insurance, an order which commissioners said never happened. 

Archer’s accountant, Cindy Thomas, blamed the city’s new accounting system, Edmunds Govtech, for the failure to pay the IRS the taxes that were withheld from city employees’ paychecks. Thomas said in an Oct. 14 commission meeting that when Edmunds would fail, she would fall back on QuickBooks, the accounting program the city used to use. She did not specify what issues the new software caused. 

The city had failed to submit its quarterly IRS Form 941s in the second, third and fourth quarters of 2023, and in the first, second and third quarters of 2024. 

Commissioners said they should have been notified of the unpaid taxes and were not. 

“If you knew it had to be paid, the money should be there,” Commissioner Joan White told Thomas in the Oct. 14 meeting. “And if you saw that we didn’t have it, we should’ve been told… And this is on us, as much as it is [Thomas] and the man [Hammond] that was sitting here before.” 

Thomas said the city has already spent the money that should have been used to pay the payroll taxes. 

On Oct. 31, Thomas resigned from the city. 

The Alachua County Board of County Commissioners (BOCC) discussed Archer’s situation in a Nov. 12 meeting and voted to help the city “as appropriate.” County Commissioner Mary Alford attended the city of Archer’s meeting that night to share the county’s offer and ask that the city make a formal request for any assistance it needs. 

White made a motion to ask the county for “any help they can give us,” seconded by Commissioner Fletcher Hope, and it passed unanimously. 

On Nov. 20, interim city manager Alltop conveyed a letter to the BOCC to officially request assistance with finances, specifically with internal auditing. She also requested additional planning help as the city works with the North Central Florida Regional Planning Council to revise its land development code. 

With no planner on staff, and after Thomas’s abrupt resignation at the end of October left the city with no accountant, Alltop said the city may have additional requests for assistance and will reach out when they are identified. 

“We are making progress with a plan to get the city’s finances back on track,” Alltop wrote. 

Alford, an Archer resident, said she wants Archer leadership to make good decisions and escape the crisis, but she said she also wants the county involved in case the city loses its charter. She said the county would need to be careful in that case, to ensure that Archer’s financial burden would not transfer to other county residents. 

“I hope that the city of Archer can sit back and carefully analyze the situation that they’re in and make smart decisions to manage their finances, and I hope they avail themselves of whatever help the county offers,” Alford said in a phone interview. “I hope ultimately that the city of Archer remains a city and that the financial interests of the residents are protected, whether they are residents of Archer or residents of Alachua County.” 

The city commission voted unanimously on Nov. 12 to hire Newberry’s chief financial officer, Dallas Lee as a contractor to look into the accounts. 

Lee made his first report to the commission on Nov. 25, where he said the city has not done general fund bank reconciliations since October of 2023, and its last water fund reconciliation was in July of 2023. He said best practice is to reconcile bank accounts within 30-60 days. 

Many invoices and expenses have no support or stated purpose, and those with support have no record of being approved. The city is not in compliance with the budget it adopted, and at some point, it transferred nearly $300,000 from the water fund to the general fund, with no documentation of the necessary approval by the commission. 

Lee said the city is involved with a lot of grants that have not been tracked, and at least one payment to the Florida Retirement System is not accounted for and deducted. 

“I’ll be honest with you guys. You essentially don’t have accounting records for the last year,” Lee told the commission. “It is in a state of chaos, so we’re rebuilding those accounting records.” 

Lee said the city got a $372,000 payment from the state, of which he and staff used $200,000 to pay down part of a $872,000 line of credit with Ameris Bank, which Lee said has been bleeding the city $4,300 each month in interest payments. 

The other $172,000 also needs to go toward that loan, but Lee said the hope was to give the city a cash buffer while also paying down the principal, to reduce the interest payments. 

Lee himself is being paid $95 per hour, with a cap of $5,000 per month. Lee told the commission before it voted to contract him that the cap will allow him to be paid for about 13 hours a week, but he would likely be working closer to 15 hours per week. 

Though citizens and White pushed back against the $95 per hour when the city is already in debt, the vote to contract Lee was unanimous, and his work began as an emergency part-time role even before that. 

“I do appreciate all you’ve done… you’re well worth every penny,” White told Lee after his report in the Nov. 25 meeting.