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January 27, 2009

 

DiNapoli's Office Completes Local Government Audits

State Comptroller Thomas P. DiNapoli today announced his office completed the audits of the Town of Newburgh - Internal Controls Over Water Operations and the Tax Receiver’s Office, and Containing the Cost of Employer-Provided Health Insurance Benefits – covering Hudson Valley Community College, City of Johnstown, Town of Queensbury, Village of Saranac Lake, County of Saratoga, Village of Tupper Lake, and County of Warren.

“My office’s audits of local governments improve their financial management practices,” DiNapoli said. “These audits are tools for local officials to make sure proper policies and procedures are in place to protect taxpayer dollars and provide the best possible service these taxpayer dollars can deliver.”

Town of Newburgh - Internal Controls Over Water Operations and the Tax Receiver’s Office (Orange County)
The town did not have a system in place to reconcile the amount of water purchased and processed with the amount of water billed to customers and used for municipal purposes. After taking into account the EPA accepted standard loss rate of 10 percent, the town could not account for over 51 million gallons. Using the average rate the town’s customers paid in 2007, we estimate that the town was losing about $106,000 in water revenue annually. Additionally, town officials did not have complete and accurate records relating to $99,000 placed in the trust and agency account in July 2006 that was an accumulation of the former tax receiver’s unidentified funds. At the time of the audit, almost two years after the $99,000 was placed in the fund, the board had not taken any action to return the funds to their rightful owners or remit the unidentified funds to the Office of the State Comptroller as unclaimed funds.

Containing the Cost of Employer-Provided Health Insurance Benefits – covering Hudson Valley Community College (Rensselaer County), City of Johnstown (Fulton County), Town of Queensbury (Warren County), Village of Saranac Lake (Franklin and Essex counties), County of Saratoga, Village of Tupper Lake (Franklin County), and County of Warren
Overall, we found that the local governments we examined were implementing a variety of procedures to reduce the costs of health insurance coverage for their employees, retirees, and dependents. These cost-saving approaches included establishing pre-tax cafeteria plans with flexible spending accounts and offering employees payments in lieu of health insurance, among other alternatives. Although none of the local governments we examined were using self-funded insurance plans, we encourage local government entities with more than 500 employees to actively explore the cost saving potential of this option. We also found that the local governments included in our audit were involved in evaluating various cost containment practices, including conducting a request for proposals and/or using consultants to obtain insurance; requiring employees to contribute toward the cost of health insurance premiums; and applying for Federal subsidy assistance payments for providing prescription drug coverage to Medicare-eligible retirees.

Click here to view the audits above.

If you have any questions or would like a comment from the Comptroller’s office regarding these audits, please call 518-474-4015.


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