Rocky Mount Burned 78% of Its Reserves, Then Cut 86 Jobs

The North Carolina Office of the State Auditor -- the constitutional office that audits state agencies and, when tipped off, digs into local governments too -- opened a review of the City of Rocky Mount after what it describes only as "a series of inquiries, tips, and concerns."▸ The result⧉, released in March 2026: Rocky Mount's combined cash and investments balance fell from $100,716,009 in August 2023 to $21,759,176 in August 2025 -- a 78% collapse in two years, or about $78,956,833, equal to roughly $1,437 for every one of the city's 54,943 residents. The auditor's verdict is blunt -- "a combination of poor personnel decisions and egregious overspending" -- and the bill has already landed on residents: 86 city jobs eliminated, and utility rates raised to help close the gap.

Like most North Carolina municipalities, Rocky Mount runs on a council-manager system: an elected Mayor and seven-member Council set policy, but a single hired City Manager runs day-to-day operations, appoints department heads, and administers the budget -- meaning who holds that job matters as much as any single vote.▸ In March 2023, the City Council unanimously hired a new City Manager after paying an executive search firm $38,000 to find him -- despite the firm itself describing him as a "stretch candidate." The audit found no evidence Rocky Mount ran a single reference check. Had it looked, it would have found that he'd previously served as Town Manager in Dumfries, Virginia, where he made unqualified hires, approved salary increases without council approval, and oversaw a $1 million budget overspend -- the same pattern he'd repeat in Rocky Mount. He served until August 2024, when he left with a $169,875 separation payment.

Capital spending and related debt service jumped to $67.4 million in FY2024, a $40.8 million (153%) increase from FY2023's $26.6 million -- driven by purchases the audit says were made without a thorough feasibility analysis or full Council review.▸ The largest: $17.2 million for 336 acres of land meant for a casino and entertainment complex that never materialized, financed on a 59-month term structured to avoid Local Government Commission review; the undeveloped land still carries a consultant on retainer at $10,000 a month to find tenants. A rebuild of Fire Station #2 ran to $11.2 million -- nearly three times its original estimate. A vehicle-fleet lease cost $6.8 million in a single lump sum, and $6.6 million more went to trucks, bulldozers, and a $341,000 armored SWAT vehicle that, per the audit, remains largely unused.

Personnel costs rose to $62.4 million in FY2025, a $13.5 million (27%) increase from FY2023 -- about 1.6 times what the entire FY2023 personnel budget had cost.▸ Police salaries absorbed the largest single piece, up $4.7 million (47%), with starting pay raised to $60,000 -- 36% above the figure originally discussed with Council -- implemented, the audit found, without a full feasibility analysis, without Council approval, and without support from the City's own Compensation and Classification Study. Fire salaries rose $1.9 million (22%), and a citywide pay-grade adjustment added $3.2 million more, approved on only a partial presentation of that same compensation study -- the City's Budget Office had planned for a 3% cost-of-living raise; it delivered 12.6%.

An obligation is money the city has legally committed but not yet checked against reality; Rocky Mount's audit found the checking simply stopped.▸ Since FY2021, the Finance Department cycled through five directors, some with little local-government finance experience, and the City went at least 13 months without performing bank reconciliations -- the basic monthly check that account balances actually match the bank's records. Fund balances fell below the City's own policy thresholds and the state's Local Government Commission minimums. Rather than enforce spending cuts when departments ran over budget -- overage that grew from $1.2 million in FY2023 to $10.3 million in FY2024, a 798% jump the audit itself calculated -- the City Council instead approved budget amendments after the fact to match what had already been spent, normalizing the overruns instead of stopping them. Separately, $71 million was moved out of the City's trust accounts into its operating funds, directly depleting the reserves the cash-balance chart above tracks.

In response to the crisis, Rocky Mount paused non-essential capital projects, cut its part-time staffing budget, and eliminated 86 full-time positions -- about 10% of total staff -- after which 37 more employees resigned and 10 retired.▸ The City also raised property taxes and utility rates, adding an average of $20 a month to natural-gas bills and $8 a month to electric bills for a typical household. What Rocky Mount's own General Fund -- its core day-to-day budget for police, fire, parks, and general government -- spent in FY2024 was $104,874,547, just over a third of the $302,767,901 the City paid out that year once capital projects and debt service are counted in. It's that wider total, not routine operations, that the overspending detailed above actually drained.

In July 2026, four months after the financial-distress audit, a second State Auditor report⧉ examined a separate crisis: in late 2025, thousands of Rocky Mount's more than 31,000 utility customers received two bills in a single month.▸ The cause traced back to the same governance failure -- unauthorized, undetected changes to the City's meter-reading and billing schedules, made in an environment the auditor says lacked basic change-management controls. Customers weren't actually double-charged, but the confusion exposed something else: two sitting City Council members, Charles "Verb" Roberson and T.J. Walker, had let their own utility bills go unpaid for months, accumulating $27,171.15 across 30 accounts and $3,060.13 on one account respectively -- $30,231.28 combined, some balances unpaid for up to 120 days, and not settled until the auditor sent the City a draft report asking about them.

That total is a rounding error against a $279 million operating budget, as the audit itself notes -- but it isn't the first time.▸ In 2020, the same auditor's office found that previous city managers and a former Finance Director had blocked disconnection for nonpayment on a different Council member's account and ultimately wrote off $47,704 he owed. The recommendation this time is the same as the one running through the March audit: require a written, funded financial-impact analysis before major spending decisions, fill the Finance Director post competitively with a qualified candidate, and hold City Council itself to the account-payment rules it enforces on 31,000 ordinary ratepayers. None of that requires new legislation -- only that the people Rocky Mount elected, and the ones it hires, follow the rules already on the books.