FOREX NEW YORK COMPANIES

Roland McElrath is leaving his post as the city's finance director to become controller at Memphis Light, Gas and Water Division.

The MLGW board approved McElrath's appointment Thursday on its consent agenda. The City Council also will have to approve his appointment.

McElrath, 51, is expected to start his new position in about 45 days. As MLGW's controller, McElrath will be responsible for developing the publicly owned utility's budget and helping to set rates for customers.

"I've had an admiration for the organization for a long time," McElrath said. "I know a lot of the people at MLGW and have interacted with them over the years, and I've enjoyed that relationship, and that's a part of it."

As director of the city's Finance Division, where he developed budget and fiscal policies, McElrath earned $118,879 annually. At MLGW he'll make $133,016 a year. He'll also be able immediately to begin drawing his annual city pension of $61,213 while earning his MLGW salary.

This is the second time McElrath has left his city post for another government job where he is eligible to receive a salary and a pension.

In January 2001, the council changed the city's pension system to allow elected and appointed officials to collect retirement benefits after 12 years of service. Previously, it took 15 years to become vested in the pension plan.

Shortly after that, in March 2001, McElrath, who began working for city government in 1988, retired from the city to become superintendent of business operations for Memphis City Schools. When he left city government in 2001 he was able to begin drawing what was then a $32,000 annual pension while working for MCS. The council has since ended the 12-year policy.

McElrath has held various posts within city government, including stints as deputy finance director, treasurer and finance director. Before starting work with the city, McElrath was an accountant with Coopers & Lybrand, a private firm that handled audits of school system finances.

MLGW president Jerry Collins said McElrath was chosen over "60 or 70" other applicants who responded to the controller job posting.

"He knows the business of finance, he knows the business of pensions and he's been involved in every aspect of the financial part of government," said Collins.

McElrath guided the city through financial troubles on multiple occasions, city officials said.

In 2005, former mayor Willie Herenton brought McElrath back to City Hall as finance director when the division, under then-Finance Director Joseph Lee III, faced unexpected deficits that resulted in service reductions and layoffs.

In 2008, the council cut its annual contribution to Memphis City Schools by $57 million, reducing the property-tax rate by 18 cents while increasing city spending by more than $40 million.

Each year since then the city has faced annual budget shortfalls that forced McElrath and his team to make large-scale adjustments to fund city schools and produce a balanced budget.

Mayor A C Wharton praised McElrath for his integrity and calmness under pressure.

"Number One, the first thing I look for in someone doing numbers is integrity," said Wharton. "I rate him highly when it comes to that. He's a very calm, steady-at-the-wheel person who has the ability to withstand scorching questioning and criticism, which you'll always get in a position like that."

Wharton declined to say if he had identified McElrath's replacement.

"We have been talking with folks, I will say that," he said.

McElrath's tenure has not been without controversy.

In December, Wharton proposed and the council approved end-of-year bonuses for most city workers. McElrath said the money for the bonuses came from a surplus created by cost-saving measures enacted the prior fiscal year.

However, in March, under questioning from council member Jim Strickland, McElrath acknowledged that city officials knew in October that the city was facing a deficit of at least $6 million for the current fiscal year, a shortfall which eventually grew to $17 million.

The council ultimately decided to dip into the city's reserves and use cuts to cover the deficit.

-- Amos Maki: (901) 529-2351