Get out the popcorn!

Despite his frantic attempts to delay the inevitable, North Miami Interim City Manager Arthur “Duke” Sorey finally (and very reluctantly) published the Fiscal Year 2018-19 Comprehensive Annual Financial Report CAFR (PDF) on Thursday night.

In order to put this whole fiasco into context, let’s first take a look at the brief history of North Miami’s final audits for each of the previous six fiscal years, as well as which city official deserves either credit for a job well done – or the blame for abject failure.

In April, 2011 then-Chief of Police Stephen Johnson was appointed as the City Manager of North Miami.  He served for three years until April, 2014, when then-Public Works Director Aleem Ghany took the helm.

Say what you will about Mr. Johnson, and some of the baggage he brought with him, during his tenure as City Manager, North Miami ended FY 2012-13 with a surplus of $6.5 million, as evidenced on page 30 of the FY2013 CAFR:

Despite the fact that the ending fund balances decreased $5.2 million from the previous year, there were still enough funds at the end of the fiscal year to “meet all other City’s current obligations to citizens and creditors.

City Manager Aleem Ghany, who took over seven months into the following fiscal year, ended FY 2013-14 with a surplus of $4.1 million, as evidenced on page 43 of the FY2014 CAFR:

Aleem Ghany tendered his resignation on September 17, 2015, mere days before the end of Fiscal Year 2014-15.  While we’re not quite sure what prompted his departure, we think it’s a shame he didn’t stick around to see the fruits of his labor.

Under his watch, he more than doubled North Miami’s $4.1 million surplus by closing out the year with a $9.1 million surplus, as evidenced on page 38 of the FY2015 CAFR:

Then all hell broke loose.

In March, 2016 then-Deputy City Manager Arthur “Duke” Sorey was appointed as interim while the Mayor and Council searched for Aleem’s replacement.  He ran the city until Larry Spring was hired a year later.

As Interim City Manager, Duke Sorey was solely responsible for managing the budget and closing out the last half of the 2015-16 Fiscal Year.

Not surprisingly, North Miami ended up with a deficit of $.9 million, as evidenced on page 32 of the FY2016 CAFR:

In March, 2017, the Mayor and Council finally made a decision and hired Larry Spring to be the permanent City Manager, and Duke Sorey was demoted back to Deputy City Manager.

Even though Deputy Duke had prepared and implemented the FY 2016-17 budget, Larry Spring was ultimately responsible for the final management and close out of the fiscal year.

As such, Duke and Larry were the creators and co-authors of the city’s deficit of $5.9 million, as evidenced on page 42 of the FY2017 CAFR:

Despite being alerted by then-Assistant Budget Director Terry Henley in August, 2017 of “the precariousness of the City’s financial situation,” Larry and Duke plowed ahead.  They prepared and presented to the Mayor and Council what amounted to a fraudulent budget for the following fiscal year.

Instead of heeding Henley’s dire fiscal warnings, the Dastardly Duo conspired to fire him for telling the truth and then publicly discredited him, all the while pulling the wool over the eyes of a hapless Mayor and Council, some of whom are still in denial about what went down.

At the end of the day, Terry Henley’s prediction of financial doom came true when North Miami closed out the FY 2017-18 with a deficit of $14.6 million, as evidenced on page 42 of the FY2018 CAFR:

Now for the fun part.

And by fun, we mean excruciatingly painful for what is hopefully going to be Duke Sorey’s swan song.

The long-anticipated FY2019 Comprehensive Annual Financial Report CAFR (PDF) was finally published … and it’s much worse than anyone anticipated.

Except, of course, for those of us who understand basic math and who saw this train wreck coming down the tracks for the last four years.

The same way he bolted from the City of Miami when an SEC civil securities investigation was bearing down on him, Larry Spring bailed out of North Miami right before the house of cards he and Duke built came crashing down.

But not before grabbing a golden parachute worth well over $200,000 on his way out the door.

Now, we’d love to show you the snapshot of the same Governmental Funds section of the new financial report like we did for the previous six fiscal years.

But we can’t – thanks to Duke Sorey’s deliberate obfuscation.

Instead of simply stating the the year end fund balance and final surplus or deficit amounts, which appears to be the usual and customary practice when preparing these reports, Duke sent the reader on a wild goose chase to review other pages in the report, probably in the hopes that you’ll forget what you were looking for in the first place.

As evidenced by page 36 of the FY2019 CAFR, you can clearly see that Duke completely omitted any reference to any dollar amounts in an obvious attempt to hide the city’s looming insolvency created under his watch.

SERIOUSLY?

Hey, Duke!

No worries, folks.

We found what you’re looking for.

But you’re not gonna like it.

Buried in the middle of page 29 is a small paragraph that reveals just how horrific the state of North Miami’s finances really are.

But, wait.  THERE’S MORE!

We imagine Duke Sorey is hoping you won’t take the time to read through all 261 pages of the newly published Comprehensive Annual Financial Report.

Because if you had managed to get all the way down to page 246, you’d see a concise and complete snapshot of everything that’s gone wrong with the City of North Miami since Duke Sorey began his tenure in the City Manager’s Office.

Fortunately, we took a snapshot for you.

In summary, here are the key facts to remember:

• North Miami ended Fiscal Year 2019 with a CUMULATIVE RUNNING DEFICIT OF $14,697,136;
• Duke Sorey & Co. BORROWED $14,334,387 from the Water and Sewer Fund to plug his gaping budget hole;
• The City of North Miami has been OPERATING ON A BUDGET DEFICIT SINCE 2016;
  
• The city is on the VERGE OF A STATE OF FINANCIAL EMERGENCY; and
• TERRY HENLEY WAS RIGHT ALL ALONG!

But, wait.  THERE’S MORE!

Buried even further down on page 247 in the report was this gem:

As of April 30, 2020, the unaudited General Fund fund balance (deficit) was $10,464,698.

What this means is the City of North Miami is not only in the hole by $14,697,136 as of September 30, 2019, but in the first seven months of the current fiscal year, Duke Sorey has already increased that deficit to:

A GRAND TOTAL OF $25,161,834!

Folks, we can’t make this stuff up.

Of course, Duke Sorey has managed to keep all of this red ink hidden by manipulating the OpenGov transparency portal, a/k/a North Miami’s Real-Time Debt Clock™, since at least the middle of March.

On March 17, 2020, we reported the city’s Expenses and Revenues bar graph posted on the City’s website the previous day.

When we checked back in May, we were shocked to discover that the Expenses and Revenues bar graph for FY 2019-20 were gone from the OpenGov cover page and replaced with graphs from 2017.

If you visit that same OpenGov page today, you’ll see nothing has changed.

This is the very same OpenGov transparency portal that Duke Sorey took full and complete credit for on the resume he submitted to the City of North Miami when he applied to be the permanent City Manager.

Here’s a snapshot:

And, remember, folks.

This is the same incompetent city official who is also bragging about flushing $1,203,721 of your tax dollars down his pet project sinkhole known as the Red Garden.

The good news is that the Mayor and Council wisely rejected Duke’s application to be City Manager.

Hopefully, the incoming City Manager Theresa Therilus will take the opportunity to assemble her own team of qualified individuals and send Duke packing.

Preferably to the unemployment line.

Where his plug can find another lick to hit.

In the meantime, don’t forget to tune into the City Council Virtual Meeting this Tuesday, June 9, 2020 at 2:00 PM to watch Duke Sorey get his ass handed to him.

And don’t forget the popcorn!

Stephanie