Legislative Joint Auditing-Counties and Municipalities

Minutes of the February tenth two thousand twenty two meeting if I have any questions or comments on them. Without not take a motion to adopt a motion we have a second all is favor say aye opposed that motion is adopted referred me to Adam Charlie see discussion of non compliance with municipal accounting law of the city Cotton Plant Marty can discuss that with yes Sir we have been to visit the city of Cotton Plant the last week or two and they are making efforts to get in compliance they're not there yet most of the findings have not been corrected they are involved with the The same lady who helped Gilmore and she is trying to get them on centerpoint and so they could maybe keep their records better. as I say they're not there yet. I would say would be after the committee as to whether you wanted to our next step would be to withhold fifty percent of their time back. And then they would have sixty more days before. Least at a term whether not they were in compliance that would be without a hundred percent return back but right now we're at the fifty percent mark and it would be at the will of the committee what you guys wish today. represent Hillman yes. Our plan is going to be in Monday district and I've been working with the mayor up there and she is trying to get this done and I'm gonna go up there's as soon as is meeting is over today and try to visit with her about this matter so if if you give me another to the next meeting I really think we can get this resolved without doing anything drastic. You have the kind of echo those usually the thing I'll look forms committee is action and and willingness to work with us which both have been met and this disc thing another not there yet I think eventually we need to pull the trigger if they don't get the compliance but I have no problem deferring this to the next committee meeting does anybody meeting have an objection or resent Love you're recognized not necessarily an objection that Mr Mysteel did you say that they were making progress the is the lady that was helping him or youth that was helping them so are they making progress or need. At the time we were there their findings mostly still were not corrected but they are taking steps to try to get them corrected they they are in the process of of trying okay well if they're making steps then okay. Anymore calls your committee. See now we're deferred this until the next meeting moving on to agenda item delta D. discussion of ACT seven on nine of two thousand twenty one use of highway turned back funds Fortner ready. Okay so if if you remember in the last session the Bill passed having to do with the the city's not spending their street term back properly and how many cities District fund money back from the general fund. The process was that they had until the end of is it next year to to repay the money completely or they can go through the process and As an ordinance to pay and actually pay ten percent of their general revenue each year until it was repaid or they could come before the committee and request a lower percentage if that was gonna be a hardship. We got our first letter from a city who owed at the time of our report they out fifty two thousand dollars to the street fund. They've sent paid they've since paid some back and now they twenty nine thousand eight hundred forty dollars. And they're asking to pay two percent per year which would come out to about six thousand dollars and the report is not coming to the committee until next month but since this is the first one I thought the Committee might like a chance to think about how you want to proceed with this if you want the people to come in if you want to accept the letter what criteria you would want to accept a paying a lower percentage And another thing is the coast says general revenue at thought you might want to think about clarifying what that meant maybe in the next legislative session because it could be to find a number of different ways and Mister five is here this was his bill he might I don't know if he would want to add anything or had any thoughts. Committee presented by you're recognized. yes in the the purpose of this was to make sure the money was paid back in a timely manner I know many of you all set in here and they'll say we're going to pay a hundred dollars month in it's figured out this could be a hundred years before the money gets paid back. in this case right here it appears that they're going to pay back in about five years I think right here and that is a proper time I think for the mind to get it paid back and I think the purpose of this bill was to make sure that they paid the money back the street fun. In my opinion what is happened was there's thirty nine cities there was at the time we looked at this bill and thirty seven of them are receiving state aid city state eight city tax projects in getting projects done in their districts. So really that money becomes useless after the highway department is doing the streets in the Community. So again. The bill was not intended to put him out of business but to make sure they come into compliance. They could be they could be sued today I guess for a legal extraction I would think of taxing for one purpose and using it for another. Yes Sir I guess that's the question I have for you Committee census reports not due till next month I think your explanation is good it's kind of my assessment of it they made strides by actually making substantial payments from one revenue source weather channel revenue or something else to the street fund twenty thousand plus dollars it looks like does this committee want them to come before us to discuss the two percent down from ten percent do we think except in a letter that we could read across be good what kind of false committee on that since this is the first time we've ever done it and will set a precedent on how we handle that going forward. Center back in recognized. Do we know what they've been paying back annually so far. And in prior years they've been paying back I don't know they have before this year and twenty they've been paying back what they missed a year and so they're gonna be here for a repeat finding next month but they've been paying like six thousand dollars a year. And this letter says that they're going to use some of their rescue plan money to pay the S. and I'm not certain that's the legal use of that and we're gonna recommend they get some legal guidance on that But they've been paying like six thousand a year and that's what they plan to pay at least six thousand a year going forward which would make it be about five years. So five hundred a month. Your roughly yes correct nine hundred twenty five dollars a week. And. However that if they didn't want some or weekly or monthly or however they did it did. They plan to knock it down by six thousand a year. Any comments for committee. Our reserve for a thank you senator Gardner senator garner state if they go through with this innate paid about six thousand a year that would actually exceed what the law requires is that right sure no Sir I believe that you said it was ten percent requirement in my correct about that and what what I'm assuming the law is I haven't read it is that there's a provision that this committee can lower the percentage like a bank from ten percent to two percent per year and that would be roughly to six thousand dollars so the question is they're asking us as a committee to lower that down to percent what's the method that we want to let that happen to recall here say yes we want Scott this which you before the lord make a decision one way the other we get a letter from them saying lower it and then we make a decision one way or the other that's kind of the reason I'm discussing the president we should set with this since they are the first one thank you Sir you represent love recognized thank you Mister chair I think isn't it thank you thank you thank they sent a letter requesting this then we can consider I mean only and only when it becomes on reasonable I think then we should have them come but other than that I mean like this letter saying that they haven't re pay within five years I mean I don't think there is any. I don't I don't think any any reason for them to come before us today if we can just say Hey you know what is this acceptable if it's not been a part of the say Hey we need to. You have a meeting with them but other than that I mean this seems to be reasonable let's go ahead and move it in that them about retirement I think it's fair comment represent Hillman and represented five okay thank you I have a question for Mr Eulogius if we would adhere to the ten percent they would pay it all off in the first year is that correct. Yes I was having to I don't have my calculator. But what if the reason behind that was if they want to go to two percent paid off in five years and ten percent would put roughly be right about now correct and so my question in my mind is is that what we're asking to much of. hidden and are they willing to do this so I'm glad to have this discussion from the Committee. I was gonna speculate here and correct me if I'm wrong I imagine that that they've been panic it's ten was six percent R. six thousand up to percent for last few years as part of the number they can live with and have we come popping for a thirty thousand dollar bill that. I think I go seventeen different ways so president of fight. Thank you Mr up in the way the bill is written is is they come to an agreement that they'll pay so much per year and they failed to do that then they'll be in default and the money will be withheld in the future the. So in that letter request would get from them we would have that agreement in the committee could vote on the agreement to accept it or not not be to lower two percent is that you would envision that happening that is correct. I have no partner with that kind of arrangement in this way so anybody last comments on this. Yes ma'am. A representative of a they need this is gonna be a repeat finding for them because they did forgot to paid in two thousand twenty so they will be here are they should be here next month they'll be invited if anyone wanted to discuss it with them and my only other thought and again I'm just throwing things out there that you might wanna think about is as represented by said. Their plan will not enable them to pay this off like within five years but if the next one comes in here that I was two hundred thousand dollars and they're gonna pay two percent a year of their general revenue that might be a long time so I don't know if if you guys wanted to have a policy or if you wanna take it case by case. The reason I the only reason I brought this up this month so you could have a chance to think about it in the committee could could decide to talk about what you want to do. President will your recognized I think I think I guess we shouldn't do in case by case in point with the president then we you know just kind of defined what reasonable is because I think five years is reasonable I think when you get beyond you know when you get beyond that you might start looking it is it is unreasonable but at the same time you know we don't want to put a hardship on someone and then they can't pay it. Then they're going to be better for us and then it you know so I guess we just have to define what reasonable is you know what reasonable amount of peer review is in this sense defined in your bill represented by. You're recognized represent five. Okay in it is not I'll be honest with you but I had a ten percent but is fully suggested that we do this to allow some of the city's to be able to correct the problem without without putting out of business of what the real issue will be I don't think this one right here I think this is reasonable in my opinion that been making an effort before this and now the proposed to do it they know the consequences if they don't pay in the future what will happen thank you to what will happen though we have some small cities that are in distress right now that award court of a million dollars that goes back decades so I think there's when the hard decisions will be made but this one here to answer to be an issue to. Yeah I would agree with that thing kind of like the standard were sent today where we do kind of preliminary meeting we discussed the merits of how we channel next one would be good standards set forth in you said if there's a degree just case or something like that in this committee can act to bring him here not injured or do that do the actual law tarmac resented Brown recognized. Well I've just been listening to the discussion and it seems that a five year plan seems like a reasonable plan and that in that plan might be one percentage for one town in a different percentage for a different town depending on how much the the debt the indebtedness is is that what we're kind of. Is that kind of a consensus that we're talking about right now yes ma'am I think that sounds reasonable. Well we'll have that come next meeting and we'll have more you discussed with them to send a letter and they're gonna be here anyway majors have discussed with them since they're here. Thank you for the question let's move on to review reports. Okay morning if you're ready. Of the first one we have a guest for is Columbia County. This is on page eight of your synopsis under previously deferred reports there's a binding under the share of cash receipts exceeded cash deposits by thirty two thousand four hundred seventy eight dollars in the bond and fine account during the period January one of twenty two September fifteenth of twenty one and receive a check selling twenty one thousand or including bank deposits to potentially conceal some of the unaccounted for cash the Bonn in Bonn Clark whose employment was terminated on September fifteenth of twenty one was custodian of the funds not deposited and share flow is here to answer any questions. Sure we can come down to the end table so your name and title for the for the room yes ma'am yes Sir down there take your time no rush. Thanks to approve thank you past award is committed. Yes Sir can you press the button for thank you representative. Yes Sir speak to Mike for the Cameron for us okay yes Sir so your name position and any comments you may have about this report my name is Mike Lowe I'm sure from Columbia County. Are you have any comments about this finding for your questions yes. You can see whenever you're ready Sir. We learned of this. In the when the return there Alright. Back in the September. Of last year thank you maybe have been September fifteenth. Of the orders were in my office during their annual audit and I discovered recognized discrepancy. And the sheriff's bond fund account. And They came in and notified me of it. The lady interviewed of our bookkeeper Cassander Ackerson. And. Before I could get a chance to terminator she left the building so I had a letter termination type today to talk about their terminated. A minute later. Calder are prosecuting attorney and advised him of what the the auditors had discovered and requested a state police investigation and I follow the conversation up with a letter to him. world listed the delegations and as for the state police to investigate it we had to wait to the final audit report was done and that was completed I think of January of this year. I have talked to the Arkansas state police or is investigator sign to it so we're waiting on that end of it to be done then it will go to the prosecuting attorney's office and we'll law will take the appropriate steps when that's completed yes Sir sheriff any questions committee. I have one real quick if you're putting systems in place to kind of make sure that this isn't happening again what what we see what time as redundancies where more people have to sign off on deposit or something like that if you do any kind of systematic change to make sure that another it sounds like very bad and poor you couldn't replicate this kind of thing I have another employee that's been there for a long time that's double check and a lot of this going forward Avenue bookkeeper and this is kind of a learning process for her. so I've got somebody helping her and kind of watching what's going on correct and report to me thank you any questions you may. C. nine without any objection we will follow support thank you for coming day share your term okay thank you want to stay down there we can talk more question I think. Thank you. In turn this off yes Sir. Read as the next report is under still under previously deferred reports on page five three seven is the city of Turrell. Hi there we have read the findings under the mayor and District Court Clerk. if you recall the District Court Clerk and recorder treasurer here in February but the committee wanted the mayor to attend his repeat binding was fines and costs collected should be deposited into a court account to be adjudicated and settle to the city county and state by the District Court Clerk as required by code fines forfeitures and calls for deposit into the city police fund and disbursement on Forsman and IT service expenditures a similar finding was there in the previous report and the mayor is here to answer any questions Mary can come to the end table so your name and title for the record in any statement you may have on these findings. My name is Charles Webster I'm the mayor of the city Turrell. I do have some hand outside like pass out. Again let's have stepped on an error let me examine in first four game out make sure their appropriate. Just one second Sir. While I'm looking at so if you don't mind go eleven comments. do not exceed compass October nineteen twenty twenty one We have three four findings and in the find is I wrote a letter to this to make model and in regards to. What we are going to put inflation or serving come a little closer Mike and hold on one second yes. Yeah I will go ahead and go ahead passes I don't see nothing to jumping out to me to allow your report and more context to. Many may proceed with the comments when rates are. Finally one we update the ordinance to identify the court the District Court Clerk. As being responsible collected all state in fact. And that's on page three and Pitsch four. Find it too we have developed payment and a plan consistent with the straight and the and the pension fund what you will find on page five and pay seven. Finding three we discussed with the judge. About the District Court Clerk responsibility and open them an account that the money will go into she will have fully responsible to be fully responsible for those accounts and for the account that we have set up and for the bank. The citation but will be turned into the District Court when they are completed so all these items that that present to you today what we put in we have put in place so for. Are you don't comment sir yes okay any questions committee. There I think if I remember correctly the issue was So my you had at the warty over to hire wasn't given the correct information to the District Court Clerk and that that was creating problems with my and Martin you elaborate on that little bit please. If I remember correctly the when the record treasure District Court Clerk were here. maybe that District Court part didn't have access to the bank records of the bank account that she needed access to in order to do some of her duties which resulted in some of the findings on on her. and I think that's why the committee wanted the mayor to come because the others and they answered the other findings correct so I think that was the issue that we need it sure it's from you that. They would have access to actually do their job because they're put a position where they're trying to fall state law but they can get the required information from. Your people in that regard do you understand that concern we have yes and you'll see on page eight and ten we have again open up a particular account. We do we are using the program cost at a point is where in fact the young lady that assisting the other two counties started without district when I will see the first so she have online access to took to account that will open up she have access to the account that that we have generated so that she can do for a bill that we should do checks all right out checks they will be done online six two I will sit up to the State of Terrel and which mean I will be able to sign bills. So she had to recognized access we have given her a computer as well to work from home or any place. Okay any questions committee. C. N. nine without objection will favour port thank you come to admire president thank you. The next one with the city of Madison. This will be on pages twenty and twenty one of your synopsis. No for anybody here we start discussing your people are your city you just go ahead and go up there front weight to your called on the answer so that we can move on the quicker. This is under report for the repeat findings under the mayor and recorder treasurer although schedule one of this report shows a balance of twenty nine thousand it was brought to our attention that as of December thirty first of twenty the general fund out of significant amount for balances to the street and sanitation funds as shown in no six on schedule three when these outstanding amounts reconsidered the general fund had a deficit balance of two hundred six thousand dollars a similar finding was there in the previous report. Continuing on the next page under the recorder treasurer. A big asset leasing was provided but did not include proper controls and identification numbers when after a couple also the listing contained items with values below the minimum amount prescribed by the city's fixed asset policy in noncompliance with fourteen fifty nine one oh seven by the mayor and the recorder treasurer are here to answer any questions thank you for camp please say your name and title for the record and any comments you may have on these funds. my name is by the Heidrick I am the mayor of Madison. And I'm honestly am probably I am the court Clerk and assistant to the record or change any comments you may have always funding. Yes Sir I would like to come in on the of the sanitation funds that the city had used in the past a fraught to help assist the agenda. Account and DO debts of something that has been done over the years but now we know for the last two years that that cannot be done and we was stated that we would try to pay that debt off we know that we're not able to pay what is necessary to to try to put that down away but we have continued to pay what we stated we would pay and we would hope in that over the years we have tell you all last couple years that we hope that we would have fun that would increase that we could increase that amount of funded a hundred dollars we were hopeful and that we would be able to increase data pay more on that date but it hasn't happened we thought it was going to happen this year but as we all know all the cost of living has. Did not that so we we just doing what we said we would try to enter Katina paid a hundred dollars and we hang out. And I know it's not enough but we are a small community there's Paul very little tax base. on retired of Community unemployed. And we just don't have a tax base to help us to take care of a lot of the bill that we need to two characters to twenty I community group. Exist. Okay. Ma'am do you have any comments couple. We had in the past D. as a cash receipt and disbursement journal for the grants and we have a USDA and the fire department and. Another account we had not use those accounts and several years so identical is necessary to continue to. Let us have those accounts because the same amount of money in any of the several years. and I did say that I would start double check and the reconciled accounts I was told that because I was the chant rider Act couldn't reconcile my homework that's why I had not been reconciling the bank statement so now we have a CPA that comes in and recognize and reconcile our bank statements for us in the end I to tell not tell me that I needed to go by hand her and approved what she the which to me didn't make sense but I said I would do it. And. We had a finding on not identified and the money that we had left in the court fund at the end of the month and that's because we have a lot of payment plans so it's really hard to save this money but while decisions in this money but not to John because it's payment plans but we have to try to work out a way to get that taken care of. And the other fandom laws that. There was one in the state we need to double check to ensure that our funds receded some money got deposited but the attitude in fantasy for it so. I started double check in at. Yes they will have everything. State Bank staff with time okay any commissioner committee any questions Senator Beckham and the representative thought. So this is one that's Maddox. I guess to some degree this the case we're talking about the very beginning is hundred dollars a month is going to take this. Hundred seven two years hundreds of the years feel that. and the general fund has a deficit of two hundred six thousand and. Two hundred nine thousand owed to the sanitation Fund for sales tax center Beckham again I think she can explain a little bit better what's going on with the numbers. Okay so it appears that this that they general but I was the sanitation Fund two hundred nine thousand dollars in the street fund twenty six thousand eight fifty nine and those make up I don't know if it's exactly there may be some more. Miscellaneous things in that amount but that's what makes the general fund have a deficit balance of two hundred and six thousand is when you take into account what they owe the sanitation Fund in the street fund. The help any. Okay. Let's go into the Mary are your charging for trash pick up and sanitation or. A yes of we received trying back money for the sensation Fund like garbage pick up of that's the only thing we have we don't have curbside pick up anything like that. Use use that money for general expenditures of what's been happening there over the past to help and have to. Support the general fund over the years and they were using some of the Senate sanitation fund to pay the bills for the general cap. I had never had it when I come in office in two thousand seven doubles there are. That's how it was done and let's say I feel in did the same thing until it was just all of that should be done can be done. What is a first come up on your radar that you couldn't do that reversal where the. I'm I'm not exactly but it was what I think I'm in the office I mean come into office in two two thousand seven and my first term tenure as the merit and I think in a couple years later maybe two thousand and ten or something like that I'm not positive. And so once that was made aware to our by doctors. We stopped. The end. Incense and even paying twelve hundred dollars a year back to the the sensation Fund yes Sir. And to the city trying to. T. H. or a hundred nine hundred each twelve hundred each okay yes. The representative five recognized. Thank you Mr mayor what is your anticipated revenue for this year. what we see is there everything is definitely dependent all trying back funds because we just don't have a lot of law. Economic Development had in the community. And we operate off of two hundred and fifty some thousand dollar which is almost return back funds. And the jury is account is the problem and I community sanitation funds I mean yes I sanitation fund of St funds we are able to convene operate a community improve not street and things like that governor because of the transportation tax if we are able to continue to take care of streets thing ninety one percent but we are able to still float have we able to Travelocity but we got a lot of things that we have to do to try to improve our community and all. That's fine streets and and sort of pot but the general fund is the one that has always have a problem. There you do you not do an anticipated revenue. It at the beginning of the year and then do your budget off that anticipated revenue yes Sir that's what we base everything they don't go off simply by what we have spent in the year before okay I was asking for that number of the anticipated revenue I'm not. And I'm not disease could could you could you get to this committee the anticipated revenue and then your budget for that year rivers had sent to us yes Sir definitely okay thank you Mr set that have yes Sir okay thank you. Any questions committee. So numbers were looking at I guess I guess the court only to say like this I guess the question is this. We've had repeat findings with this over and over again I know we all some of that is because you're still paying into it but is this problem getting worse every year or getting better are you all. Going more in debt in your general revenue street finds everything all combined or you all kind of got a stop to the bleeding and now you're trying to dig your way out of it yes Sir is not a continuing up happening of we are not getting worse we we we are able to to maintain but to increase to try to double does fund that we all it hasn't happened I was hoping the issue would be to year but things changed Senate because where the cost of living have gotten we still have to try to run out of general fund all we know supplies for to operate the main office and things like that we still depend all we have to do that with the general fund because we don't have anything else on the site because we've been just like we say we can go to these other accounts and touch anything. Lightwood got us into trouble for you to get your getting money from the multitude of federal or state programs are in cover nineteen America rescue funds anything like that yes Sir we did pandemic funds we did but was also told that we could touch so far we talked to be a young lady and its work with us and explain to pending funds to us and it was stated that we cannot use those fund to help all the accounts in the community. And we talk directed to the young lady who's all that program. Okay we look into that we hope was hoping we could but we were told no we shall get I think it was like seventy thousand dollars seven thousand okay representative brown recognized. Thank you Mr chair Mr mayor What what would be your anticipated Sources of revenue of besides turn back I mean the term once you understand you get those but do you have like what do you have for your sources of revenue. Four than I'll answer that other than the ster bac money we only get money from a court fines and permits and things like that and that is it. So general follow up so then you have to operate your office and. do you have a police. Yes. So they have to have the salary that you have to pay their salaries and the and and operator office building and I'm just trying to understand what you've got coming in and what you might have go Now. Yes ma'am and not police department is a small department and is a we have right now we have two officers on duty and they are part time they have to they work other jobs to try to. Sister. D. it said there's no property yes ma'am it is not a lot of profit and in in this committee and the community yes a lot of raw even I know we can offer we don't use the police department to help fund a community city is just a bill ability and ability is to pay a fine if you violate the law and. A lot of people are not working unemployed and I'm not paying their tickets. Thank you Sir. Senators field you're recognized yes thank you Mr chairman good afternoon. Thank you for being here. Your challenge at this point yes ma'am because you don't have a local source of income no ma'am Last minute what is the percentage of local taxes do you happen to Little Rock as an extreme amount of local taxes that we can generate do you have a local tax in addition to the regular taxes I can name the the business that we have so you have a business tax yes ma'am yes ma'am all in. Three B. it is located in the community I see and there's no end of there's no tax on individuals for particular services so you don't have that source of income either. This year are you aware of what the limitations were that were placed on them with the pandemic money I know that could be spent for specific things but. It would be helpful if we knew what the the limitations that they were told they could that were placed on them for their use would that be helpful for us to know. And see then if there is some way we could use some of that to mitigate something that would be of assistance to them free of monies that can be spent for other things and that that money supplant that. Yes ma'am I'm gonna given a broad overview of things I've heard I know that the federal government for certain restrictions on them and. It gets into how you spend the funds and how it goes towards certain things I've heard a lot of different ways is being use maybe the Municipal League would have a better feel on the guns they given out to they make you reached out to Municipal League about this issue yes Sir that's what we know they have their first information that was given to a far as was stated that these is files can only be used by like I employees working doing a pandemic and they had to come to work and sold those are the fun we were. How we would be using the funds is to pay bills employees I've been out there in the as a safety and the dangers all on it this information is coming straight from them in this league to help us to build what we supposed to do I guess that's my question and so you have seven thousand dollars and you paid an employee to work during that time but that would supplement your government expenditures for that and then that that the money was still exist from term back in otherwise I believe you legally could use for other purposes is that correct what what what did you do with that seventy thousand that was now could be used for other purposes we are using some of the fund to pay employees for the time that you are a law where employed they they never did stop come to work and what day was out there yeah but you had incurred that labor work labor expense anyway correct under your normal general revenue that you would pay out. Yes I'm meant magis on center chest bill may be complaint but the seventy thousand eight you're paying now you would have had to pay out of other funds did you have those funds in the first place and if so now that that's been freed up can you use those monies to help you mitigate other problems that that's why I want to be because I know the seventy thousand had certain constraints. But you use the base salaries five. Where was the money that you would have used to pay the salaries wouldn't that help. We're with the medicine part you were going to pay somebody fifty thousand dollars okay what bonded that come from like did you have that money available and if so you could use that seventeen get this over here something else that's what I'm trying to get okay okay and we understand that we have they what they told us that we could pay the employees two dollars our from the pandemic much. Two dollars up to from to to I think it's at thirteen. So what we did was give employees a two hour hour increase. From the pandemic so you have to still pay the bulk of the salary thank you. Thank you. Okay I get you. And one of the persons that we used to work in the past with individual cities they were having difficulty like that Mrs Mister I'm going to share that person's name with them then perhaps you can help them make that the appropriate okay Senator Beckham I think your connection with Q.. So the city operates problematic primarily off state funds and revenue generated from the police correct. Without system yes Sir somebody has. Right your term funds did not drop during covid. No context no indeed so the city did lose revenue during during the pandemic. Your employees came to work still got paid during the pandemic with funds that you receive from term that. Yes and then you received. The. Pandemic assistance money. Instead of using that for allowable expenses or whatever your term that into bonuses for all the employees. Including elected officials city council things like that no it was not bonus funding and it wasn't it wasn't back pay from now it wasn't they told us that we could use that money and give the employees happened like a Colin incentive pay maybe for work and doing the pandemic so the money that we use to pay the employees from these turnback money we still use that money it didn't decrease. Because we got the pandemic might we still pay the employees at same salary per hour that they were getting before we gas the pandemic money once we get the pandemic money we gave them a two dollar increase per hour in paid retroactively or yes going forward and they got that in a lump sum yes so they got a two dollar an hour bonus for every hour they work during the pandemic yes the money now okay and there is a one hundred seventy six different pages of stuff that you could spend the money on from the federal guidance originally. Or delegate the job look at in the we did look at the up of any other way that we can use the funds are no more than asking could we use some of the funds to pay off some of the other debts that would. That we are read up all the and we was told and in this league of the one who even we didn't know anything about these funds until the Nestle contact us and listen to what the government was saying about this relief fund and that's how we even became aware of it and the you know much of the seventy thousand no paid out that way. Okay. Just because we didn't start until I think first of this year. I thank the conversion issue we started beginning stop paying somebody pendant Fund aw before the end of the year we start paying some depending follows. What about hearing interject how much do you have a ballot so how much are you that you have left. We have I think close to thirty thousand land okay my suggestion would be this maybe give the Municipal League and see if you could use that in other areas specifically to start paying back more a more substantive funding of this if you directly can't they maybe there's other ways you could cover different centers that a legal and in an accountable on that front anymore questions committee. C. nine without objection with the files reports thank you all for coming day morning if you're if. Thank you. The next report is the town of Perla which is on pages twenty one and twenty two. We had repeat finding this is consistent on reports of a repeat findings under the mayor and agreed upon procedures and compilation report was not obtained is submitted to Arkansas legislative audit for the town's water or sewer departments FOR the years fourteen through twenty as required by code we noted in the August fourteenth seventeen minutes at the town council approved a hundred ten thousand dollar loan every use grant funds to the city water and sewer department we recommend the city seek legal counsel to determine whether this meets reviews grant guidelines a similar finding was issued in the prior three reports. And the mayor is here to answer any questions. Thank you if you can please say your name and title for the record any comments you may have. Can you put a Michael or closer make sure its own I can't really tell which is which. Ramen Adams is my name and I'm here representing the city of Perla. Correct and you are the mayor yes Sir okay if you have any comments about in responding no Sir. Okay we'll open up to questions. Page twenty one correct twenty yes I'll start off the. Okay I got so many repeat findings going back for multiple years of not correcting these issues. Is that a question no you you asking me that question yes Sir okay the reason the repeat in. Findings of the audit of one forty six fourteen. And up to whatever but anyway we had our audit. from left the here in Little Rock he did I think first of fourteen fifteen and sixteen and we pay them I think about three or four five thousand dollars to get started he never did complete it so we sent back a city need to seven both the thousand so we didn't have the money so that was the end of that then after that we just had been able to have any money to be able to have that or not It but we have always have had a CPA you know in the House of. Keep in the account but if he does account had been added up to this point simply because we haven't had the money from the water department to to do that and the simpler reason why we did didn't have the money because of we get in a Gadam problem to where well I provider was set in this would billing us for nine million gallons and weak all it was selling to a customer receiving money for three million so that went on for years so that put us you know just back to what we couldn't pay anybody anything because I approved auto with robin is whatever and we we had different people stand to look to try to you know find the problem and we just had been able to get the problem corrected but up to this point from December the name of the judge hello. Put us under receiving ships of Central Arkansas Water so these over the all of the bills and whatever that we had to do with Prada water so they are taking care all that now and Hopefully that they would be able to help straighten this out but don't want to tag and. when we was trying to make this sale in two thousand eighteen I think I came here before we was at the. And I will say with liberty water and it got up to the last minute and they pull out for some reason I don't know what it gets booked all but I don't know if it I will provide a clue but anyway we've had three sales in order to sell the water department what we could pay the bills often the people day role in it things that we needed to and. Each. I have a sale. Presales and the money will be sent to the title company. Bhosale. So we got to vote in the court to please proceed with ship receivership and I had to go sign and for these people to get their money back. Because the court would let us seal the water department I have no idea why but we try to send it we know we need. In two thousand eighteen in order to come out of this but we was unable to to get all this of you know done because I don't know with the apple bottom of. What was trying to keep us from making a sale Armero it's a I think I was good explanation let's start with questions committee representative you're recognized. Thank you Mr chairman so I have a question about the payroll the salaries paid out and then the city. withheld. Zero taxes they did not pay it to the IRS. So you said that you're gonna re calculate the payroll taxes and then pay the IRS has that been paid. The bill paid the IRS what you owe them okay well we haven't paid not we haven't at this point and all the bill's been presented to the roof receive a. She of and my understanding that they are is is held at all of that up to this point so that's what we ate there are simply because we couldn't see all the paid people solve I had to return and tentative return of thousands of dollars back to the bio so when receivership came and they just took over you know all the responsibility of Senate president and follow up Mr yes Sir you're recognized so you so you still have employees on board now correct we have employees on board but the manage under C. A. W. okay yes Sir okay great thank you thank you Mr yes we're gonna represent Hillman let me follow up on that I think we should discuss in is that we found a job and pay the IRS payroll tax in in in your room finding you're saying you're gonna for that money on so yes yes yes he was a city yes we we we own it and uh we wanted to do all this we have a full now but we got blocked we don't know how this shouldn't they should have anything to do with the receivership this is you all over the R. as a as a C. right right right you're going to pay it you're in the process either paying that already have paid it correct that we in the process of working on that now yeah yes Sir not working on it you need to get it is right now and could I. You don't wanna mess with the R. S. I understand that we all know their taxes Richmond. Right up there and was a let's go back to the. The issue of the water you said that you were receiving and I'm gonna be commander The New York you seventy nine million gallons of. Month from your water source anyway only billing for three million gallons yes Sir thank you might have a leak somewhere well. We we told several things in we know we got a rule rule while out and they you know kept out and check and no we have several you know different peoples there then also we found people saw of sabotaging the system you know couldn't liangelo right I had that night so we just have a lot of what you call a of of people just to you know just against you know. The Department so do we just don't a lot of stuff in. Tended to on it so I think sense of C. eight W. found out I think they can to find finding out about of about foot wheel was been going through you know so they find out quite a bit that we couldn't find about. Municipality is of the utmost municipalities bill eighty five ninety percent of the total of volume with so the the red flag to you from the very beginning and something should be done about this a long time ago yes Sir you you're correct so you're saying you did nothing yes Sir we we did all we could do in our manpower and the money that we had to do with it we do we tried everything yes Sir it's not that we just laid down and just let it loose we went there and tried. Okay thank you Mr. Anymore questions committee president right you're recognized gestures thank you senator garner of mayor the party which is a couple things that are that are not exactly right here Sir but you know this twenty seven one seventy five on the salaries if you paid the portion to the federal and the state it probably would only be six or seven thousand dollars it would sure it be good to get that straightened out Sir yeah what what I think was happening Sir that studio no pan what should have been paid was tried to do please the provider. You know with the money that was company and so I just know that with the wrong way to go and now we realized. Thank you representative anymore questions committee. CNN without objection will follow support thank you mayor moving own. I believe that's the last report that we had gas for so we can go and start back at the first. page five with the first two reports are the city of off court nineteen and twenty and the committee has been deferring those is that still the wish yes well objection. So on page five under previously deferred reporter had the city of I'm free the the court treasurer Kimberly Burgess was invited to be here but I have not heard from her. Of would you like me for me to defy that one yeah looks like a million dollars and pay taxes. Yes ma'am please the first object. Okay if you remove your page eight. The Newton as this is still a previously deferred reports hi the Newton County sheriff was invited to be here. He our supervisor called him we see a couple of certified letters parity at accompli today he said he need to be and Camden. Would you like to depart that one again as well. Yeah let's have a discussion about that so. We're about at the point has committed there we need to make a decision on this one or the other I know how I feel about it but I don't want to. We influence committee so that we've requested this multiple times I think there's multiple members here who have serious questions about this that we need answered we received a letter last time that we didn't think was sufficient and we've asked him to come they'll at least four or five meetings I'd look back number. This committee has the ability subpoena power of both houses committee the legislative audit has that ability and it's something that we rarely use but at some point we have to really consider whether that's when the Avenue we need to go down if we decide to do that there's it's gonna be okay we'll subpoena sent out no have legal consequences to that it could have court decisions made off that in the future if the sheriff decides to go down the legal route of it. So I'm kind of at a loss of what else options to do without doing that and I'd love to hear from the Committee on this particular issue. Not everybody wants representative you're recognized. Thank you I agree I mean this is been it's almost to the point where I feel that asking questions about it because it feels like a beating a dead horse but we can't let them win just by not showing up so I think subpoena makes sense here my question I actually have a question about the District Court Clerk because I've spoken with you all sort of offline about the real questions I have about these probation fees I don't know that we've ever asked the District Court Clerk to come maybe the sheriff can answer those questions but it seems like it may not be within his jurisdiction is there any way that we can ask the District Court Clerk to come if they have not yet been invited. They have not been invited yet because this is not I repeat finding okay We are getting ready to start the next alright the twenty twenty one it's going to be a two year this one is for two thousand nineteen. We can make a point to investigate this further while they're at work I could ever get ready started pretty quick. And it might be more efficient prices to look and see while we're there and if there's still a problem then she would be invited because you have a repeat finding okay is less ongoing problem that I'm concerned about more more wondering about what happened to those fees they collected that he and and I know we've spoken about it but I don't know it may just be outside the jurisdiction of this committee I'm still kinda new here but if it's not I think that that is I mean there are. As concerning as so many things are in this report and the fact that probation fees or improperly collected from our Kansans and we don't really know where that money went or whether they were ever made right and feels like something we should take a closer look at we can do that Let me jump in here I've kind of had a policy on the Committee where I've called people that staff typically doesn't bring here not abuse that privilege myself unless there's an objection committee I have no problem with bringing anybody that's on these reports for any reason and so a prison county if you want to have them all here I'm more than happy to do that I get that privilege to anybody who sees anybody on this report unless there's a conflict the reason they can't be here that's legitimate I think we have that power is individual member so who have staff moved for with inviting them then we'll move on like we do with any other invite thank you thank you we will see we will send the court Carter letter along with the share of another letter. Representative you're recognized okay thank you Mr chairman of I've been on this committee as long as I've been of in the in the legislature and I think we probably you subpoena powers two or three times in that time. So I'm hesitant to say that we need to do this with a share of I think he is dodging coming down here there's no doubt in my mind about it at least so I guess my question to the staff is can we send him another letter explaining to him and and citing the where is in the code about us and subpoena power and tell him that this is last chance to come voluntarily. Yes Sir we can definitely do that And we like to maintain good working relationships with these officials and I believe our supervisor up there has called and talked to him and in addition to the letter we will make sure that we have a conversation with him as well okay. It is is that something that's except where marijuana I wanted to be here and I want to tell me why I didn't have a chance to buy those guns like it buy it that like this pawn shop did. I think that's more acceptable man this is. On the last stroll final stroll on this and I'll just say it pretty bluntly Casey's we hear this or see this if he does not show up next meeting comply I will make every motion effort to subpoena him on illegal forty of this body will happen legally in front of us or he'll face the consequences of not coming someone that said clearly understood. We can move on to the next meeting our next agenda. First. We now have to investigative letters the I guess this is a little timely part of water and sewer department and one on valley volunteer fire department engine the law is going to give us a summary of those two. Whenever you're ready jim. This is special for. This page is not intending your synopsis. Thank you Marty and Mr On the part of water department as the mayor. You probably get from the mayor earlier their water and sewer department within the needs quite a bit recently for having some serious financial problems. So the prosecutor asked us to review their records to see if maybe some of those problems were the result of funds being misappropriated. So I looked at the the year twenty twenty. The January through December compared receipts with deposits and for that whole time period I think. It was the off two dollars and fourteen cents so. It appears that all the water bill payments that were entered in the computer system work properly deposited in the bank. then elected to disbursements look at all the canceled checks all the thank you David and I didn't find any improper there disbursements at all. The only problem I did find had to do with their major deposits you know as someone moved to town guests or water turned on they have to pay a major deposit. And that's kept a separate bank account will and most places it stays there until it's either applied to the customer's balance or returned to the customer. But it Perla probably because of the financial problems they were dipping into the major deposits and using that money to pay operating expenses of the department. So they weren't necessarily handling their major deposits properly but. At least based on the procedures that I perform there was no indication that any money was being misappropriated for personal use. Marty you want me to go right on into the alley or we want to open to questions because I know I have one so for that meter deposit just correct my appearance if you move to a new place you put a deposit down of X. amount of dollars as kind of a safety net that if something happens that meter the city can replace it or any there's a purpose for that for that meter for the even there and that if I leave the city I get that deposit back correct right out I think it's because their call meter devices I really think in reality the purpose of it is if the person moved and then pay their bill they've at least get fifty dollars they can apply to the. That were they given that money back out the people when they were leaving yes Sir they were okay they are just make sure about that okay. Any other questions committee. See now move on to next report okay on the Valley volunteer fire department is a small fire department down south of Monticello injury candy. their fire chief who also served as a board president retired in two thousand nineteen and then after he had retired they were some board members that discover some possible improper spending by the fire chief and they contacted the prosecuting attorney and the prosecutor asked us to look at it. Selected the period of January two thousand sixteen through February the fourth of two thousand twenty. And I found ten thousand three hundred fifty seven dollars in improper and undocumented disbursements. this included seven thousand two hundred eighteen dollars and transfers to the fire chief personal bank account and also cash withdrawals by the fire chief. Before I got involved in is the Some board members to question them about these transpires and he said that he was just reimburse himself for department expenses that he had paid out of pocket but according to the treasure he never provided any documentation to support. as I was going through the files I did find several invoices that total a little over forty four hundred dollars that. Weren't paid from the Department bank accounts by the we couldn't determine who paid the invoices so it's possible that the fire chief may have. Those may have been invoices that he actually did pay out of pocket. But even if you give me credit for that this still leaves about twenty eight hundred and undocumented payments that he received. And then one last thing we were told that the fire chief open a new bank account without board approval. And we found some board minutes that indicated that the board met and approve the account being opened and those minutes for signed by the fire chief. However the treasure and to as the board members who were according to the minutes at that meeting said that those minutes were fabricated that no meeting ever took place on the board never authorized him open that account. And of course all these findings have been referred to the prosecutor. Mention any questions. What have you found that has seen like a the owner what laws been broken missing like some have. All right thank you Sir. But yes without general file both words great work. On page eleven and twelve under reports referred to the prosecuting attorney we have the city of Portland. Of the finding referred to the PA's and the mayor and recorder treasurer the city over paid a total of six thousand thirty three dollars to the following employees sixteen sixty to the recorder treasurer due to an extra payroll checks you receive in December and for an hourly raise not approved by the city council seventeen sixty two employees it's eight eighty each two to an hour it raise not approved by the city council. An eight eighty in seventeen thirty three to the mayor and employee respectively who are paid from the water sewer funds due to an hour hourly rate is not approved by the city council. On the next page on twelve Page well with the top still under reporter for the prosecuting attorney under court treasurer. in September of two thousand eleven the city received a writ of garnishment for a city employee beginning in set in January of eighteen the city sees complies with the terms of the garnishment resulting resulting in a judgment against the city is gonna she telling four thousand three hundred seventy five dollars for interest acute accrued legal costs and wages not withheld the city also was responsible for attorney fees selling twenty nine hundred dollars five hundred for preparing a motion or seeking judgment against the city is Garden City and twenty four hundred for general legal services this is city's failure to comply with the reader garnishment resulted in a waste of public funds on seven thousand two hundred twenty five dollars the defendant is still employed by the city. Who is the defendant. And. The defendant is the city employee I don't know the name. I recommend. It's referred to prosecutors all right any questions about this what objection father report next. On page thirteen still under reporter for the prosecuting attorney the city of Campbell Station. The city paid credit card charges telling seven hundred six dollars in two thousand nineteen without supporting documentation to substantiate a valid business purpose. And this again was referred to the prosecuting attorney. Without objection father Fort. Still on page thirteen under the city of flipping of the under the mayor and deputy city Clerk supporting documentation was not provided for tasty credit card disbursements of six eighty eight nine fifty three twenty eight sixty nine and two thousand twenty nineteen eighteen respectively in noncompliance with code all these chart although these charges were made vendors normally used we could not verify business purpose due to an adequate supporting documentation. Well general follows for. On pages fourteen through sixteen still under reports referred the prosecuting attorney we have the town of Gilmore. and I know you'll notice several repeat findings. Gilmore was one that we had looked at under the withholding of term back under fourteen fifty nine one seventeen we actually visited them In November of twenty one and noted at that time that most the repeat findings are substantially corrected this report is for December thirtieth of twenty. I would under the PA we have fines and costs revenue of forty nine thousand exceed thirty percent of the town so expenditures in the preceding year by fifteen thousand and non compliance is twelve eight four oh three which is the speed trap law. this revenue was generated from private defense citations written by or rest made by the town's law enforcement personnel or from ancillary actions related to the enforcement of traffic offenses that's what's been for for I reported the prosecuting attorney. Under the Meyrin record treasure we have repeat findings. Although schedule one of this report shows a balance of ninety two eighty five was brought to our attention that as of December thirty first of twenty the general fund a significant amount for balances in the street and fire department trying funds as shown on no five on schedule three when these outstanding amounts reconsidered the general fund had a deficit balance of nine thousand and ninety dollars a previous findings that in the previous report. I doubt the recorder treasurer at we have some repeat findings the general street and fired for a quick minute training bank accounts were not properly reconciled in noncompliance with code. Bank reconciliations were not approved by municipal official or employee other than the person preparing the reconciliation and non compliance with code. The general street fund cash receipts and disbursements charms were not properly classify to proceed and the fire equipment training fund cash disbursements journal was not probably posted in noncompliance with code. And continue on the next page. Still under the record treasurer repeat findings as opposed to us bring documentation was not provided for testing disbursement of twenty five thousand in noncompliance with code a fixed asset leasing was established within not include cost values additions and control totals as required by code. The following issues were noted when reviewing payroll records salary payments to this mayor report treasure council members in various employees report on Irish forms ten ninety nine miscellaneous is informed of you to. Payroll disbursements in the town's general ledger did not agree with amounts reported to the IRS. A payroll journal is not provided for those employees whose salaries are not processed using paychecks. In addition for those employees it appeared that federal and state taxes or not withheld and remitted. The town did not report all employee compensation on form W. two or ten ninety nine miscellaneous. Unallowable expenditures from previous years of four thousand. Using. Four thousand fifty six pay for the fire equipment training fund or not repaid. Property taxes the seven eighty eight and state eight of thirteen thousand for highway funds in previous years of the street light or not transferred during the engagement period. The total amount due this tree funded December thirty first of twenty was fourteen thousand three nineteen. And that would be all of the PA and repeat findings for Gilmore. Without objection will follow support. I still on page sixteen we have a town of Jericho. A Jericho. What a backup of. I got ahead of myself. I'm Gilmore they were in actually invited to be here and and we do not hear from them do we want to deferred that as an to come to the next meeting I think we already filed and it's I think you just move on from it. Jericho that record treasure is invited to come at for repeat finding but there is a P. a finding another speed trap binding fines and costs revenue fifty one thousand exceed thirty percent of household expenditures in the preceding year by eighteen thousand other revenues generated from traffic offense that Haitians written by rest made by the council enforcement personnel Do you want to say the repeat findings till they come next time and referred further. On page seventeen we have the city of Camden that the city Clerk was invited to be here she called and was ill and requested to the fire the father for objection. Clark County on the same page on seventeen. the sheriff had a repeat finding and he was invited me here and call and had a previous obligation the father port without direction. On page eighteen of the town of gum springs record treasure was invited to be here as she called it she's having a medical procedure then plans to resign. So we have to committee if we wanted to fire at our file it or I guess we could depart and see if she resigned at whatever the committee's pleasure use thanks for an update so deferred we'll find. On page twenty still under repair reports the repeat findings we had the town of Haynes they were the mayor and report Frazier requested to fire as they had a prior commitment. The for the objection. Her. On page twenty two still under reports for the repeat findings at Arkansas County. there was a repeat finding under the treasurer and he requested of our until may. The father objections. Them pages twenty three to twenty nine we have reports twenty five reports with findings adequate responses would be happy to answer any questions about these if there are no questions staff would recommend filing those reports any questions. Representive right recognized his or her agent Beth Milligan on you Senator but of Mr Marty on page sixteen of that fifty seven nine fifty three that they use restricted funds did they give you an answer about what they were going to try to do about that. Can you repeat that which which city and which pages are service centers on account of Gilmore on page sixteen it It speaks about street money which is turned back to that you know it comes off the sales tax of its fifty seven nine fifty three down toward the bottom of the page I just wonder if they're going to try to pay that are. Mr. It is your Collins or Jericho and yes I believe we already passed that and we reporting the report next out of the area within we depart that next time and so they can answer when they come if that's okay. That's a question next report. But on the roof findings with we're proper responses from the reports do we have any other questions on those. Without objection will file these multiple reports. And then on pages thirty and thirty one we have. Forty two. Okay memory my writing forty two reports with no findings instead would recommend we filed those without object will quality for to report without five. Right moving owned the next meeting will be may twelfth two thousand twenty two and what that we are adjourned thank you.