Although the Board approved lists of vendor claims that were prepared by the Analyst, it did not complete a proper audit of the claims from vendors prior to paying those vendors from either the operating account or the private funds account. In addition, although the Library has accumulated over $762,500 in private funds as of the end of 2014, it has no formal written plan to use the money. The Library maintains approximately $627,000 in mutual funds, fixed income securities and cash equivalents with two investment brokerage firms; these are improper investments at unauthorized financial institutions. Finally, the Board failed to review the bank statements, bank reconciliations and investment statements of the private funds. As a result, there is an increased risk of loss on investments, including principal, and that errors fraud or abuse could occur without detection.

The Board needs to improve the District's procurement process. District officials did not adopt a procurement policy as required by General Municipal Law (GML). The Board also did not seek competition when obtaining goods and services that are not required to be competitively bid in accordance with GML. The only procurement guidance was contained in the District bylaws, which simply state that the Director will determine the most economical method of maintenance when purchasing Library office and service equipment. As a result, District officials did not consistently use competitive methods to procure goods and services. In addition, the Board did not ensure disbursements from the discretionary fund were made in accordance with the bylaws. Finally, the Board appointed an independent contractor as Treasurer. While the Treasurer does not take an oath of office (a requirement for holding public office), we found no significant indication that this is an independent contractor relationship.

Payroll duties are not adequately segregated and there is no periodic management review of transactions, certification of payrolls or review of leave records. The Board also did not clearly document its authorization of compensation for all Village employees. As a result, Village officials could not provide documentation showing the Board's authorization for $15,309 of the Clerk-Treasurer's salary, and the former Clerk-Treasurer was overpaid $10,638 for a separation payment. In addition, seven employees received payments that were not authorized by the Board, totaling $5,091. The Clerk-Treasurer did not maintain adequate leave records for herself and for fiscal year 2013-14, five employees received less sick leave than the Board authorized. The Department of Public Works Superintendent also prepared and approved his own leave-time slips with no oversight. The Board also did not properly audit claims to ensure they were adequately supported or were for proper Village purposes. The Clerk-Treasurer does not present the Board with abstracts or claims for capital project funds. One Board member reviews and approves any capital project claims related to construction costs. Without a thorough and deliberate examination of the individual claims and the supporting documentation, the Board does not have enough information to determine whether the claims it approves are appropriate and legitimate and there is an increased risk that improper claims could be paid.

The claims auditor is responsible for reviewing the claims to ensure they have adequate support and proper approvals, and that the purchases are for a proper District purpose. The claims auditor stamps each claim to show her approval and certifies the warrants to authorize the Treasurer to pay the claims. The claims auditor provides the Treasurer with the claim packets and the warrants. The Treasurer returns the claim packets to the Central Business Officer and keeps the approved warrant on file. The accounts payable clerk mails out the check payments. The Treasurer does not oversee the application of her signature on checks or compare checks to the warrant prior to issuance. Consequently, there is an increased risk that improper disbursements or payment errors could occur.

District officials enacted budgets with planned operating deficits and used approximately $1.9 million of fund balance to finance District operations in fiscal years 2011-12 through 2013-14. The Board and District officials initiated actions to reduce expenditures and maintain financial stability beginning in the 2012-13 fiscal year. The Assistant Superintendent for Business projected 2014-15 year-end unrestricted, unappropriated fund balance to be approximately $2.7 million, or 4 percent of the next year's budget appropriations, which is the maximum allowable by law. We reviewed budget-to-actual results for fiscal years 2011-12 through 2013-14 and found that the Board adopted budgets with realistic revenue and expenditure estimates. However, the Board has relied on appropriated fund balance as a financing source in the annual budgets, which reduced the District's unrestricted, unappropriated funds during that period. As a result, the District used approximately $1.9 million of fund balance during the last three fiscal years. The Assistant Superintendent for Business stated that the District increased the amount of fund balance and reserves used to balance its annual budget because of the New York State property tax cap and reduced State aid funding levels. However, officials expect that the District's unrestricted fund balance will return to the maximum permitted by law at the end of the 2014-15 fiscal year.

District officials have not effectively managed fund balance as unrestricted fund balance annually exceeded statutory limits (projected to exceed by $4 million as of June 30, 2015) and reserves are overfunded by approximately $3.2 million. This occurred because District officials consistently overestimated expenditures by a total of $8.5 million over the four-year period ranging from 7 to 14 percent more than actual expenditures. Although District officials adopted budgets which included appropriated fund balance, the total appropriated fund balance was not needed because of their overestimation of expenditures. Despite the excess unrestricted fund balance, District officials continued to raise taxes each of the four years.

The purpose of our audit was to assess community colleges’ compliance with safety reporting requirements established under the Clery Act for the period January 1 through December 31, 2013.

The Board and District officials did not effectively manage the fund balance of the general fund. As a result, the District had unrestricted fund balance in the general fund totaling $670,000 or 6.2 percent of the following year's appropriations as of June 30, 2014 and reserve fund balances that increased by almost $2 million (131.1 percent) from 2009-10 through 2013-14. If the real property tax levies remained at the level of the 2009-10 fiscal year, the total taxes paid would have been $1.1 million less than the amounts actually paid, while still generating more than $270,000 in surpluses. Although the general fund's fund balance was over the statutory limit and several reserves were overfunded, the Board continually adopted budgets that included tax levy increases that were not necessary. As of the end 2013-14, the general fund's unrestricted fund balance was 6.2 percent of the ensuing year's appropriations. While the Board has adopted budgets that included an average use of more than $570,000 in fund balance for each of the last five fiscal years, operations have generated a combined surplus of more than $1.3 million during the same time.

District officials need to improve their oversight of fuel use. Despite the use of a fuel management system, District officials do not review system activity reports to identify anomalies regarding quantities dispensed, fueling times and the odometer readings entered by employees. We found eight instances where the fuel volume dispensed exceeded the vehicle's tank capacity or a reasonable volume given the amount of miles driven between fill-ups. We also identified 140 instances where fuel was dispensed without an odometer reading and 26 instances where the odometer readings for vehicles were less than the previous readings for those same vehicles. Further, District officials do not reconcile fuel purchases to fuel use and remaining fuel or maintain an accurate list of assigned fuel keys and vehicles. In some instances, fuel key and vehicle numbers are not unique and no logs are maintained to document the purpose each time a master key is used. Master fuel keys were used in 376 transactions to dispense 4,075 gallons of fuel. Finally, the Director of Facilities and Operations does not maintain a log of fuel usage for the 275 gallon diesel tank in his Department which had deliveries totaling $6,326 during our period or have knowledge of who was reordering the fuel for that tank. As a result, the District cannot properly account for how much fuel is pumped into specific vehicles and by whom.

The Board did not properly manage the District's fund balance. The District's available fund balance has accumulated to more than 400 percent of the 2015 budgeted appropriations as of the end of 2014. Almost 89 percent of the District's $383,300 fund balance has been placed in 25 certificates of deposit accounts. While District officials told us these accounts were created to be used for future capital purposes, these funds have not been formally established as reserves. Therefore, these funds are available for funding operations. From 2012 to 2015 the Board budgeted to raise $91,300 in real property taxes for capital purposes.

We identified significant internal control weaknesses in the Court's financial operations. The Justices did not properly segregate the cash receipt duties and did not provide oversight for cash receipts. Consequently, we found that collections were not properly accounted for or deposited timely. In addition, accurate and complete bail records were not maintained and bank reconciliations and accountability analyses were not performed for all Court bank accounts. As a result, the Justices and clerks were unaware that, as of January 31, 2015, Justice Lamitie had a cash shortage of $4,273 and when he resigned, Justice Cositore had a cash shortage of $834. Furthermore, when Justice Cositore resigned, he did not file a final report with the JCF, close his official bank account or transfer pending bail to the other Justice or the succeeding Justice. We also found that the Justices did not establish policies and procedures for enforcing unresolved traffic tickets, which resulted in unpaid traffic tickets not being properly enforced along with potential lost revenue to the Town. In addition, the Town lacked comprehensive policies and procedures for preparing and processing payroll and maintaining leave time accruals for Highway Department employees and Town officials did not provide adequate oversight. We found that 12 of 14 Highway Department employees did not receive the correct gross pay, resulting in 11 employees being overpaid a combined total of $3,885 and one employee being underpaid $193. Furthermore, Highway Department employees' leave accrual records were also not accurately maintained, which contributed to the overpayments. In addition, as of January 31, 2015, we found five employees' sick leave balances were overstated by a total of 91.20 hours, valued at $1,756, and four employees' sick leave balances were understated by a total of 32.90 hours, valued at $645.

The Board has not established procedures for the Library's collection and disbursement of donated funds, or for cash receipts collected at the circulation desk. The Treasurer has not maintained adequate records for the money received from donations and fundraising activities. In addition, the Treasurer wrote checks disbursing these funds without Board approval or sufficient documentation to demonstrate it was used for Library purposes. We also found that the Librarian did not properly account for fines and fees collected at the circulations desk and did not remit them timely to the Village.

The Board did not establish policies and procedures to provide guidance to Village employees or implement sufficient controls over leave accruals and payroll timekeeping to ensure that the Superintendent's leave time was accurately accounted for. As a result, the Superintendent carried over unused leave time valued at approximately $57,000 as of November 28, 2014. Although Village officials discussed payroll and leave accrual procedures with employees, no comprehensive written payroll timekeeping and leave time accrual policies and procedures were in place to provide further guidance. The former Mayor told us that each pay period the Superintendent is required to complete a timesheet and accrue vacation and sick leave and use accrued vacation time during the calendar year, when possible. The Superintendent told us DPW employees are supposed to use the time clock to record their work hours. However, without a written policy, there is no formal guidance regarding the accrual and use of leave time or time clock use.

The Board and District officials have appropriated a significant amount of fund balance for the District's budget over the past few years. For example, over the past three fiscal years the Board appropriated $675,000, $525,000 and $376,626, respectively, in its adopted budgets. The Board has not adopted a fund balance policy establishing the level of unrestricted fund balance to maintain. As a result, the general fund balance has declined approximately $1.2 million, or 64 percent, over the past four years. Furthermore, the District has used general fund money to help subsidize the school lunch fund operations over the past several years and at the end of the 2013-14 fiscal year, the school lunch fund owed the general fund nearly $44,000, which is likely uncollectible. Lastly, the Board did not use $250,000 in the insurance reserve for authorized and intended purposes during our audit period and it has not included a provision in the 2014-15 budget to make a required repayment of about $35,000 to the repair reserve to replenish it after moneys were used for emergency expenditures.

The Board did not receive adequate monthly financial reports or establish a sound budget process.

The District is serving nutritious meals to its students. However, the meals cost more to prepare than the revenue generated by the meal sales. In addition, the District's productivity level for meals per labor hour is below the industry averages. Although the industry averages may not be achievable given certain District conditions, District officials can use the industry averages to monitor operations and work towards increasing productivity.

While we commend the Board for contacting us with its concerns regarding the Project, we found that the Board should have known about most of the discrepancies detailed in the complaint (See Appendix A for our comments on the complaint). The Board did not provide adequate oversight of the planning and execution of the Project and did not ensure that the Co-Managers properly monitored the Project. The Board did not always provide clear, written expectations, such as the authority granted the appointed Project Co-Managers, or their monitoring and interim reporting requirements for the Project. As a result, the Board halted further work on the Project until it received clarification on the Project's status and costs. The construction phase of the Project was further delayed due to the redesign and requirements for landowner access, which resulted in increases in material and prevailing wage rates. In addition, the Board did not ensure that County contracts were properly approved, monitored and paid. Of 40 contracts, 11 did not have approval of both the Board and the County Attorney, and four contract renewals/amendments were not approved by either the Board or the Attorney. No procedures were taken to ensure the lowest possible cost was paid for 18 of 28 professional service contracts included, totaling $1.2 million. For the other 10 contracts totaling $6.3 million, although no quotes or requests for proposal (RFPs) were required per the County's procurement policy, County officials did use RFPs to seek the lowest possible cost.

We found that the Committee could improve its oversight of the Company's financial activities. Although the Committee has adopted Company bylaws, which include cash disbursement policies, we found them to be inadequate. Even though the Company's bylaws specifically detail the audit committee's responsibilities and the Treasurer's duties, these guidelines did not adequately segregate or provide oversight of the Treasurer's duties. The Treasurer controls all aspects of the cash receipts and disbursements processes without any oversight or mitigating controls, such as independent review of his work. At each monthly meeting, the Treasurer provides a balance sheet listing the cash balance for three of the Company's bank accounts, check registers and cash receipt journals, where necessary, to the Committee and membership. Even though the Treasurer provides these financial reports at the monthly meetings, he informed us that no one discusses these reports during the meetings. Further, the President did not appoint a three-member audit committee to review the Treasurer's work during our audit period. In addition, the Committee has not adopted policies or procedures for financial operations such as conducting fundraising activities, purchasing goods and services, and processing claims.

The Board did not establish and maintain an environment committed to accountability, competence and transparency due to its lack of policies, guidelines and monitoring. The Board didn't ensure that the Secretary included sufficient detail in the Board's meeting minutes, did not comply with Town Law relating to Commissioner elections and did not properly document relevant payroll information. In addition, the Board-adopted policies related to food purchases and travel were not comprehensive and not adhered to by District employees and officials. The District also has no policy regarding credit card usage. The District paid 665 non-payroll expenditures totaling $1.3 million during the audit period. We reviewed 177 food, travel and credit card expenditures totaling $86,337 and found that the Board did not ensure that these expenditures were adequately supported and valid prior to approving them for payment.

Because the Library's purchasing policy does not address procurements that are not subject to bidding laws, Library officials did not always seek competition when procuring goods and services. While the use of competition for such procurements is not legally required, the law does require a policy to be established; and best practices indicate that the use of competition helps ensure the most prudent use of taxpayer moneys. We found that Library officials paid a professional service provider and an insurance broker a total of $90,912 without soliciting competition. Further, Library officials did not solicit competitive bids when procuring services costing $134,076; and did not solicit competition when procuring goods and services from 10 vendors who were paid a total of $28,551. As a result, Library officials and taxpayers have limited assurance they obtained goods and services at the most reasonable cost.