For interim Petersburg City Manager Tom Tyrell, Christmas and New Year’s cannot come too soon.

That’s when property owners are supposed to pay their next quarterly bill for real estate taxes — and steer fresh revenue into the depleted Petersburg coffers.

Until those payments come in, the city essentially will be broke, potentially having less than $100,000 in its bank account, according to a report the Robert Bobb Group consulting firm provided to the Petersburg City Council and the public last week.

The Washington-based Bobb Group, led by former Richmond City Manager Robert C. Bobb, was hired to manage the City of Petersburg.

The group noted that Petersburg almost ran of out money to pay city employees this week.

Fortunately, the group, with help from the state, reported finding $1.3 million in accumulated interest on $11.3 million in unspent funds from bonds the city issued thorough the Virginia Resources Authority, or VRA.

That money has enabled Mr. Tyrell, an employee of the Bobb Group, to meet Petersburg’s Nov. 18 payroll and also to ensure that the upcoming Dec. 2 payroll will be paid, the group stated.

The group noted that the city’s ability to continue meeting payroll through June 30, the end of the current fiscal year, depends on the city borrowing $6.5 million on a revenue anticipation note, or RAN, to be paid back in monthly installments through October 2017.

Still to be secured, the RAN became possible, the group stated, when Petersburg was able to reach a settlement with the South Central Wastewater Authority on a lawsuit filed by the authority that treats the city’s sewage.

In its suit, the SCWA sought to force Petersburg into receivership to collect current and past due payments that were undermining the SCWA’s finances.

Initially a judge approved the receivership, but the SCWA backed off after the Bobb Group agreed to make a $1.3 million payment to the authority by Dec. 15, make monthly payments on future service and find a way to pay back the rest of the money the authority has been due since May.

The litigation threatened to put Petersburg in default on all of its $53 million in outstanding debt and essentially eliminate any prospect to gain a RAN, the group reported.

Petersburg City Council has authorized the consults to obtain a RAN, and the Bobb Group expects to do so prior to the deadline for paying the SCWA.

The city’s condition is still dire at this point.

“As of Nov. 18, after (Petersburg has) made its November debt payment (on outstanding bonds), paid key vendors, provided $427,500 to schools and covered payroll, we will have $78,000 remaining, assuming no other revenues are received by the city,” the group reported.

The RAN and the quarterly tax payments are expected to provide temporary relief.

Once the RAN is obtained, the group stated, the city could cover payroll; pay for such critical services as the emergency communications system; pay for federal and state services that have not been paid for; pay critical maintenance and utility bills; pay Virginia Retirement System line-of-duty payments; and pay bills for expenditures that already have been incurred in the 2017 fiscal year that began July 1.

The Bobb Group stated that it would bring a report to City Council in January that would recommend budget revisions be made to ensure spending and revenues are strictly aligned.

At this point, it appears that council will have to amend the current budget, which the group described as “not realistic and that certainly will not be realized.”

Since taking over, the Bobb Group reported that it has found that despite the council‘s vote Sept. 6 to cut spending and raise taxes, the city’s internal system was never adjusted to reflect those changes.

So “despite a spending freeze being in place, the city has continued to spend” as if it had an abundance of revenue rather than a shortfall, the group found. The result: City checks for payment were filed away in a drawer in the former interim city manager’s office.

In order to improve fiscal stability, the city needs to work with the VRA to restructure its $53 million in outstanding bonds and to lower debt payments to provide more money for current operations, the group stated. The city is paying more than $5.2 million a year and needs to cut that back to no more than $5.1 million, the group stated.

The good news, the group found, is that a spending cutback is possible largely because the city has banked $11.3 million in funds from bonds that were issued between 2013 and 2015. The money was never spent on the intended projects.

The Bobb Group is recommending that $4.7 million of that money be spent on critical projects, such as repairing the decaying tower on the historic Hustings Courthouse so the building can be reopened for Circuit Court use and buying a needed ambulance for emergency service.

Then, instead of going ahead with other important projects, the Bobb Group received council’s authorization last week to work with the VRA to use the remaining $6.6 million in issued but unused bond funds to either pay down city debt or to reduce debt payments.

Separately, the Bobb Group is hoping to work with the state Department of Transportation to recover some of the matching funds Petersburg provided for various road projects.