City Hall’s money man gets AAA rating from peers

Anacortes American, WA
Aug 25 2004

City Hall’s money man gets AAA rating from peers

George Khtaian flashes his famously winning smile at his home in
Anacortes, after stepping down as city finance director. The city’s
longtime administrator is credited with introducing the city to
careful financial management and keeping it there.
George Khtaian’s conservative financial style served Anacortes well
for 29 years
Not many people who see George Khtaian briskly walk the Washington
Loop Road each morning, accompanied by his longtime companion, Pompy
the Pomeranian, know that City Hall’s sterling financial reputation
has rested in the hands of this man.

For 29 years, until his declining health forced him to step down in
June, Khtaian as city finance director oversaw the city’s annual
budgets, shepherded its numerous bond issues and was part of an
executive team whose conservative management has kept Anacortes in
the financial pink for nearly 30 years.

On almost all counts, he will be missed at City Hall.

“What he contributed to the city over his career really needs to be
acknowledged. He took a situation where there were debts everywhere
… and put us in an extraordinarily sound financial position,” said
Ian Munce, city attorney and planning director.

The 74-year-old Khtaian, who had extensive heart surgery and a bout
with prostate cancer in the 1990s, has been battling shortness of
breath and fatigue related to an unknown lung condition. Because the
illness sapped his energy and left him with a persistent cough, he
decided in June to step down.

“When they asked me at work when I planned to retire I told them they
would probably find me dead at my desk. And it almost turned out that
way,” said Khatian, laughing.

He wanted to leave differently, within the next three years and with
his successor firmly in place.
Mayor Dean Maxwell said City Hall has interviewed candidates for city
finance director and should name Khtaian successor, who will have big
shoes to fill, next month.

“He is leaving a big hole here,” Maxwell said. “We trusted him. He
did such a good job for the whole community.”

The conservative, no-nonsense approach that Maxwell and others credit
Khtaian for bringing to the city’s finances came to him honestly.

The youngest of three brothers, Khtaian was born in Peace River,
Idaho, and raised in Newport, Wash., 50 miles north of Spokane. His
parents had emigrated to the United States, after they lost their
families when more than 1.5 million Christian Armenians were killed
under the Turkish rule of the Ottoman Empire.

They met and married here and firmly embraced American values, while
retaining their culture, said Khtaian. Khtaian’s father was a section
foreman on the railroad and George’s oldest brother, Ed, followed as
a chief dispatcher. The other son, Steve, is an artist.

“They were wonderful, hardworking people who loved this country. It
hurts me when I hear people say they don’t want any more immigrants
in the U.S. We need that shot in the arm,” he said.

Khtaian, who was then affectionately and sarcastically known as
Generous George in grade school because “I wouldn’t share my peanuts
with my friends,” was a standout in drama in high school and later.
His specialty was Moliére and even decades later he proudly shares
his noteworthy reviews.

“I was a thespian in high school and my teacher, Lucile Lake, put me
in Moliére’s “The Miser.” I was a natural for that one,” said

After high school graduation, Khtaian spent one year in college, then
four years in the U.S. Air Force. He met his wife, Lorraine, while
serving and the couple celebrated their 50th anniversary nearly two
years ago. When Khtaian returned to the University of Washington, he
earned bachelor’s and master’s degrees in accounting and business
administration. He worked in the private and public sector in Oregon
and Washington before being hired in Anacortes in 1976.

He came to the city when double-entry bookkeeping and cash only was
the norm and transformed the city’s financial administration into a
sophisticated and responsive system that has won national awards and
recognition, prompted Wall Street to offer increasingly better bond
interest rates and garnered 21 straight years of sterling state

Smart and knowledgable, Khtaian stayed in his small-town position
because he was given huge responsibilities, a challenge he relished.
He was treasurer, city clerk, budget officer and finance director,
among other titles.

A fiscal conservative, Khtaian looked for more and better ways to
save the city money. He saw it as a challenge, to move beyond basic
financial principles and find creative methods to squeeze a dollar.
He also found, especially in the latter years, a city administration
and City Council that was as tight-fisted as he was. Working as a
team, “a family,” he said, has allowed the city to prosper even
during tough economic times.

He said that approach is critical especially now, with various state
initiatives slicing into the city’s revenues while the city’s costs
are steadily climbing.

“It’s so simple. You save now when things are good because the lean
days will come. It’s that biblical. It’s hard to do this, but you
have to,” said Khtaian, who set up a series of cash-reserve accounts
within the city’s accounting system to weather any eventuality. His
pinch-penny philosophy allowed the city to build a new police
department, a new library and pay for sewer-line and water-line
upgrades, with little or no impact on ratepayers’ wallets.

“It all ties together. If the finances are sound, if you get good
audits, then you get good bond ratings. I feel good about that
because that’s my job, this behind the scenes work.

“The average citizen doesn’t know or appreciate that, but we are
saving them money,” he said.


Sterling record
George Khtaian, recently retired as Anacortes finance director, has
been lauded repeatedly throughout his career, in the city and

– 1976, Most Valuable Member Award, National Association of

– 1983-1984, co-founder, first president, Washington State Municipal
Treasurers Association.

– 1989-1990, president, Municipal Treasurers Association of the U.S.
and Canada.

– 1991, organized the All-America City team, which was a finalist.

– 1992-2000, a series of excellence awards to the city finance
department from the Government Finance Officers Association and MTA
U.S. and Canada.

– 1993, the Phillips award, MTA of the U.S. and Canada, highest honor
for “outstanding leadership.”

– 1999, secured an A-3 bond rating from Moody’s Investor Service, an
unusual ranking that meant a savings of up to $300,000 over the life
of city bonds.

Khtaian also published more than 50 technical articles for
professional journals, was an editor for seven years for two
professional finance organizations (state and national) and was a
16-year editorial board member for the Journal of Systems Management,
Cleveland, Ohio.