RALEIGH — A new performance audit report says the city of Rocky Mount is on the “brink of financial collapse.”
The audit, released by the Office of the State Auditor (OSA) on March 9, says that poor personnel decisions and significant unchecked overspending by the former city manager drove the city to severe financial distress between fiscal years 2023 and 2025.
“OSA’s audit of Rocky Mount has uncovered serious financial failures, which culminate with an astonishing 78% decline in the city’s cash and investment balances in just two years,” State Auditor Dave Boliek said in a press release. “From the lack of due diligence in hiring the former City Manager, to cycling through five Finance Department directors, it’s clear that Rocky Mount has not been serious about resolving its financial issues.”
In addition to the performance report, the OSA issued an investigative special report titled “City of Rocky Mount Comprehensive Plan.”
According to the audit and press release, the city’s cash and investment balances plummeted 78%, from approximately $100 million in August 2023 to $21.8 million in August 2025. That drop occurred amid surging expenditures, including a 27% rise in employee compensation and a 153% increase in capital purchases in fiscal year 2024 while revenues declined by 2%.
Key examples of overspending included $17.2 million spent on land for a proposed casino and entertainment complex that never materialized, $11.2 million on Fire Station No. 2 redevelopment that was cited as nearly triple the original estimate, $6.8 million on a vehicle fleet lease, and $6.6 million on equipment such as fire trucks and heavy machinery.
“The citizens of Rocky Mount were right to worry about their city and the financial condition of the City of Rocky Mount,” Boliek said during a press event last Monday.
The audit highlighted the hiring of the former city manager as a “stretch candidate” despite red flags from his prior role in Dumfries, Virginia, where he oversaw a $1 million budget overspend, along with failures by the city council to provide adequate scrutiny, such as approving budgets without detailed data, missing audit deadlines and allowing attempts to bypass approvals.
“What we found was a former city manager in charge of everything from carrying out policies and ordinances to managing day-to-day operations who went unchecked and was held unaccountable for years,” said Boliek. “He was hired without due diligence. While he was employed, the city council failed to effectively monitor the significant overspending taking place, and this is a story of checks and balances for two years. And the fact is there were none in Rocky Mount.
“This mess is unfortunately costing local residents, who have experienced an uptick in their utility bills. My office has heard the overwhelming public concern and interest in this investigation, and I want to thank all those who have provided us with tips and information on this audit.”
Additional issues included high turnover with five Finance Department directors during the period and an unauthorized $795,500 consulting contract, of which $385,610 was paid before termination.
In response, the city has paused projects, eliminated 86 full-time positions, cut part-time staffing, and increased property taxes and utility rates, raising typical household monthly bills by about $20 for natural gas and $8 for electricity.
During the press event, Boliek also said the OSA is still engaged with the city and is looking at purchase card transactions, which will be in a subsequent report, and utilities in Rocky Mount as part of an information systems audit.
“I’d like to be able to say that the city of Rocky Mount is on the right path, but I’m not in a position to say that today,” Boliek said.
