While Viv May said he had seen no evidence of corruption at Armidale Regional Council, the administrator said millions of dollars had been wasted.
An audit is looking at the council finances since the merger of Armidale of Guyra councils in 2016, as in that time Mr May said $8 million has been blown.
Speaking to the media on Thursday morning inside the council chamber, Mr May said this year's budget would see funds reallocated so more could be spent on basic services such as roads and bridges.
He said not enough had been spent on those basics.
"I don't believe there's been any corruption. It's mismanagement, it's dysfunction," Mr May said.
"The council was in turmoil, it was a toxic culture and the place crashed."
While a commissioner could recommend criminal charges, Mr May said he did not believe that was an issue in this case.
"I don't propose that there's been any corruption whatsoever. I have massive concerns about the finances of the council. Since the merger, in effect $8 million of cash has gone."
He said that figure could include projects running over budget, but he would not know for sure until the report, which is expected to be to be handed to the council in November, is completed.
"We will be open and transparent with the community, because they deserve to know where the money has gone.
"The money hasn't gone missing. We just can't account for it," he added.
In his three months as administrator, Mr May said he had heard from many residents, including former councillors, and he described the culture as toxic.
A public inquiry would have a benefit Mr May did not have, which is those issues would be raised under oath with cross examination permitted.
"I would think there would be a queue up, of not only councillors but of residents who have issues that they wish to air.
"I've been told a lot," he said.
He also indicated an inquiry could look back years to examine where it all went wrong, causing the council to have such a poor culture.
"It's not a finger-pointing exercise, I don't think there's a single person to blame for what occurred here. I think it's been going on for probably 10 years or more. Even before the merger."
He described the court case, where the council sought an injunction to prevent councillors terminating the CEO's contract this year, as an expensive sideshow, but said it probably did the community a favour, as it led to the suspension of the councillors.
"I still can't work out how the council took itself to court," Mr May said.