New York State Comptroller Thomas P. DiNapoli today announced the following local government audits were issued.
The board did not properly approve and monitor projects. Auditors determined the board did not ensure its project approvals were based on project applications that were completed and supported with applicable supplemental documentation and an adequate cost-benefit analysis. The board and officials also did not properly monitor to ensure the annual report filed with the New York State Authorities Budget Office and the Office of the State Comptroller was accurate with respect to job performance, sales tax exemptions and payment in lieu of taxes (PILOT) information for current and active projects.
The board did not provide adequate oversight of financial operations and exceeded its authority under New York State Town law by authorizing the supervisor to pay all expenditures without prior audit. The board did not request or receive adequate monthly reports from the supervisor. For example, the board did not request or receive monthly cash reports detailing money received and disbursed, monthly bank reconciliations or cash balances for each fund. The board also did not ensure bank reconciliations were accurate, timely, and properly reviewed.
The board did not effectively manage the town’s financial condition. As a result, it levied more taxes than necessary to sustain operations. The board also did not adopt realistic budgets and failed to monitor budgetary results during the year. In addition, the board allowed excessive levels of surplus funds to increase. As of December 31, 2020, the general fund’s surplus funds were $134,448, or 89% of actual expenditures. In addition, the highway fund’s surplus funds were $386,162, or 84% of actual expenditures. The board diminished financial transparency by annually appropriating fund balance that was not needed to fund operations.
Town of Clarence Industrial Development Agency (CIDA) – Project Approval and Monitoring (Erie County)
The board did not properly approve or monitor its projects. The board also did not verify job creation goals or other criteria while assessing material aspects of the proposed projects prior to approving them. The board did not properly monitor projects to determine whether project goals were being met. Officials did not ensure that project approvals were transparent to the public by posting required documents on CIDA’s website. In addition, the board and officials did not ensure that CIDA’s annual report was accurate before submitting it to state oversight agencies.
The board did not properly audit claims prior to payment or ensure written quotes were obtained as required. The board reviewed listings of claims but generally did not review them before approving payments. Health insurance claims totaling $495,104 were not approved for payment by the board, and claims totaling $52,000 to the local Chamber of Commerce did not include receipts as required. Of the purchases totaling $239,411 from 34 vendors auditors examined, village officials purchased goods and services totaling $141,269 from 27 vendors without obtaining written quotes or retaining supporting documentation of their solicitation efforts or justifications for not seeking competition, as required. The village’s procurement policy did not comply with New York State General Municipal Law.
Two OSC audits issued in 2010 found NC employees received benefits inconsistent with Council approvals. Most of the prior control weaknesses remain and the council still has not established specific leave benefits of NC employees. As a result, auditors found seven NC employees earned 2,213 more hours of leave than employees in the collective bargaining agreements, valued at $110,500. Four NC employees were paid for 265 more hours of unused vacation leave than limits established for employees in the collective bargaining agreements, valued at $13,700. The mayor did not require department heads to track their time worked or to submit leave requests for taking time off, and the council did not approve all leave drawdown payments.
Town officials did not ensure comp time hours were accurately accrued and accounted for. As a result, officials do not have adequate assurance that all comp time is appropriately earned, accurately recorded and properly monitored. Town officials did not establish a policy or written procedures to ensure that comp time hours were authorized, documented and accounted for. Town officials also did not require comp time to be properly supported and approved by direct supervisors. In addition, town officials did not ensure separation payments that included a payment for unused comp time were supported.
Town of Hempstead Local Development Corporation (THLDC) – Project Approval and Oversight (Nassau County)
While the board properly approved and monitored projects in accordance with standard project procedures, it did not set clear and specific goals when approving projects. The board issued a total of $96.6 million of tax-exempt bonds and $1.8 million of taxable bonds during the audit period. However, THLDC officials cannot determine whether projects are meeting the intended purpose because the goals of the projects are not clearly defined in the authorizing resolutions.
The board was not transparent when funding and purchasing fire apparatus. The board levied more taxes than necessary to finance annual operations and its actions hindered taxpayers’ ability to make informed decisions. The board also overestimated appropriations to accumulate more than $1.1 million in fund balance to purchase a fire truck costing more than $727,000, instead of establishing a capital reserve.
In addition, the board did not adopt fund balance, reserve or budgeting policies, along with multiyear financial and capital plans.
The justice accurately recorded, deposited, disbursed and reported fines and fees in a timely manner. However, the justice did not ensure computerized case records were updated in an accurate and timely manner or that all closed cases were properly reported to appropriate state agencies.
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