Numbers don’t lie — unless they are taken out of context, say city officials.

Several city officials said context was missing last week from a local publication’s editorial that claimed the City of Natchez experienced a &uot;catastrophic $5 million in loss&uot; during fiscal year 1999.

&uot;There is no deficit,&uot; City Clerk Donnie Holloway said. &uot;You’ve got to look at the whole picture.&uot;

Peter Rinaldi, editor and publisher of Miss-Lou Magazine, authored the editorial.

&uot;This is all I have to say: I took everything from Gillon’s financial report,&uot; Rinaldi said, referring to the audit by Natchez accounting firm Gillon and Company.

In 1999, the city’s gross income was $16.6 million while its expenditures totaled $21.6 million – leaving a negative difference of $5 million.

But, the city’s audit report also shows an additional $4.1 million in revenue from other financial sources, including monies from leases, refunded bonds, sale of real estate and transfers from other funds.

&uot;Of all cash balances, they decreased by $1 million,&uot; auditor and certified public accountant Billy Gillon said. &uot;That’s a fair statement.&uot;

While it is fair, the remaining $1 million also requires explanation. Gillon compared the city’s finances to to the personal checking account of an individual.

A person could have an account balance of $100, then deposit a paycheck for $500. If the person then writes a check for $550, he or she is not in debt, Gillon said, because of the previous month’s balance.

&uot;(The city) had accumulated some money for a project,&uot; Gillon said. &uot;You have to save money to do a project.&uot;

Ward 3 Alderwoman Sue Stedman said the city’s net beginning balance for fiscal year 1999 was $4,232,376 – money not allocated for other uses.

Subtracting the remaining $1 million from the beginning balance still leaves the city $3.4 million in the black.

&uot;Yes, that’s less than it was the year before,&uot; Stedman said. But, the city had intentionally left money in the till from fiscal year 1998 in anticipation of future projects.

One of the major expenses in the 1999 audit was the $12 million in bonds the city received for construction of the convention center and refurbishing of the community center and city auditorium.

Because the city had planned on the project well before December when the bonds were issued, it had monies set aside, Gillon said.

The Miss-Lou Magazine editorial also suggests that the city is only $4.9 million away from meeting the state’s cap on bond debt.

&uot;Who’s worried about it?&uot; Gillon asked. &uot;I don’t think that’s important.&uot;

It is important if every loan the city receives in bonds builds toward the state-mandated cap, but they don’t, Gillon said.

Only specific bonds &uot;count against&uot; the city, he said. In fact, the $12 million for the convention center project did not qualify. Those bonds were issued from the Mississippi Development Bank.

Also, the cap amount is determined by a sliding scale that is based on property values, Gillon said. As the city grows, the bond limit moves up, too.

Stedman agreed the city’s borrowing status is not in jeopardy from the state bond cap.

The $4.9 million margin becomes wider when taken in light of the total amount the city can borrow in qualifying bonds: $13,444,832. In reality, the city is only at 62 percent of its bonding capacity, Stedman said.

While the city has been borrowing – and spending – more lately, taxes have not gone up in more than 12 years, Ward 5 Alderman David Massey said.

But, that could soon change, Massey said, to compensate for the city’s growth.

&uot;There’s so much left to do in this city, and we may have to raise taxes to do it,&uot; Massey said.

Contrary to last week’s editorial, the sales tax growth has not leveled off, Mayor F.L. &uot;Hank&uot; Smith said.

It is normal for tax figures to be lower in the second half of the year, because most ad valorem and property taxes are paid during the early Spring. &uot;It’s not uncommon to get into a tax receipt slump this time of year,&uot; Smith said.

Last week, the Board of Supervisors voted to transfer money from the gambling fund to help cover the city’s payroll.

Smith said that maneuver and his request for a 10 percent reduction in department budgets are unrelated to the editorial’s claims.

&uot;I don’t think it’s related at all,&uot; Smith said. &uot;You can’t just read half a report and that’s what I’ve been told happened.&uot;