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Office of the State Comptroller - Local Government & School Accountability
Taxpayers' Guide to State and Local Audits

Audits of Local Governments and School Districts

Town of Lancaster – Financial Management (2012M-130)


Released: October 12, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to determine if the Town protected the taxpayers’ interests and exercised due diligence concerning the acquisition of a building and the Town’s fire protection agreements for the period January 1, 2006, through May 18, 2012.

Background

The Town of Lancaster is located in Erie County. An elected five-member Town Board, presided by the Town Supervisor, is the legislative body responsible for overseeing the Town’s operations and finances. The 2012 Town budget totaled approximately $30.2 million for all funds.

Key Findings

  • Town officials did not exercise due diligence when they purchased a warehouse building in 2003. As a result, the Town invested approximately $2.5 million in a building that it no longer intends to use and, along with the County and the Lancaster Central School District, lost approximately $440,000 in property tax revenue.
  • Officials did not properly protect the interests of taxpayers when they entered into fire protection agreements for the 2006 through 2010 fiscal years. Consequently, the Town likely provided more compensation than necessary to four fire companies.

Key Recommendations

  • Develop policies and procedures that require specific planning steps to be followed prior to initiating significant capital projects and follow these procedures for the construction of the new building and conversion of the existing garage. With the decision to sell the warehouse property, exercise due diligence in ensuring that the sales terms are in the best interest of Town taxpayers.
  • Annually review the fire companies’ budgets and financial statements to be in a better position to negotiate contracts that are more fiscally responsible to the Town’s taxpayers.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236