Officials in Dutchess County’s East Clinton Fire District improperly paid nearly $35,000 in personal expenses for members, including rent, cable television and college fees, according to an audit released today by State Comptroller Thomas P. DiNapoli. The findings of the Comptroller’s audit and investigation were referred to Dutchess County District Attorney William V. Grady.
“Fire district officials treated public money like their own personal bank account,” said DiNapoli. “It’s disappointing that my office continues to uncover lax oversight and misuse of taxpayer dollars in fire districts. I will continue to audit these entities so that taxpayers are assured their money is being spent prudently and properly.”
The East Clinton Fire District serves about 2,500 residents in Dutchess County. The district’s fire department has 57 volunteer members and receives the majority of its funding through real property taxes.
DiNapoli’s audit revealed district officials used more than $26,000 to pay the personal bills of district officials and fire company members, including utilities, cable television, insurance, college fees, books and rent. In addition, the district made two interest-free loans in 2011 to two board commissioners, totaling $8,500. District officials have not sought reimbursement for the gifts or loans.
During the 16-month audit period, auditors also found the district paid the secretary-treasurer a total of $118,940, which equates to the secretary-treasurer working more than 11 hours a day, seven days a week, every week, for 16 months.
The Comptroller’s audit also revealed:
- Bank accounts totaling approximately $463,000 were listed as reserve funds even though the board could not provide evidence that it met the legal requirements to establish these reserves;
- Cash and check receipts were not recorded and several receipts were held in excess of 200 days before deposit;
- The secretary-treasurer only reconciled one of the district’s bank accounts on a monthly basis. Consequently, the district was incorrectly charged a variety of bank fees totaling $2,340 that were not caught because reconciliation of other accounts was not done;
- The board did not obtain the legally required independent annual audit; and
- The secretary-treasurer did not file required financial reports with the Comptroller’s office for 2006 through 2010 in a timely manner and has yet to file the district’s 2011 financial report.
DiNapoli made several recommendations to the district to improve financial oversight, including:
- Seek reimbursement of gifts and loans made with public money;
- Adopt written policies and procedures covering financial activities including investments, cash receipts and deposits, reimbursements, travel, cell phones and disbursements; and
- Obtain an independent audit of the district’s financial records on an annual basis.
District officials indicated they have taken steps to improve their internal financial controls. Their complete response to the audit is included in the final report.
For a copy of the report, visit: http://www.osc.state.ny.us/localgov/audits/firedists/2014/eastclinton.pdf
For access to state and local government spending and more than 50,000 state contracts, visit http://www.openbooknewyork.com/. The easy-to-use website was created by Comptroller DiNapoli to promote openness in government and provide taxpayers with better access to the financial workings of government.