Legislative Joint Auditing-Counties and Municipalities
Video
Transcript
1 document
Machine transcript
May contain errors. Verify important quotations against the official video.
About transcript accuracy
- Source
- Whisper
- Model
- ggml-large-v3-turbo.bin RTX5060
- Processing date
- October 7, 2026
Unknown speaker
0:00
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Representative Danny Watson
Unverified
3:30
Okay, committee, I call the meeting to order. It's 1.30, committee on counties and municipalities, legislative, joint legislative audit, call the meeting to order.
First up on the agenda will be the adoption of minutes on the October 8th,
2020 meeting. We have a motion, Representative Love, to approve.
Okay. Thank you for correcting me on there.
okay it's looking behind me we have a motion we have a second any discussion all in favor all in favor those opposed like sign thank you we have our reports on item c reveal reports and and we're going to go ahead and to expedite it just a minute we're going to go ahead and do some explanation on the city of all ports thank you miss steel i just wanted to
Representative Mary Bentley
Unverified
5:03
give you all a quick update on what's going on with allport
if you'll remember back in september the committee voted to continue the process to revoke the charter of allport and we sent letters to the city and to the ag's office and the governor's office to get that process started and there was like some miscommunication in between there and we sent another letter to the AG's office before Thanksgiving and now they're they're on it we've had some conversations with some members of their office and Frank has been involved and
I think they're planning on filing a complaint tomorrow or soon if not tomorrow to get that going in
Speaker 10
5:46
the court system does anybody have any questions about that okay stand by
Representative Danny Watson
Unverified
5:55
just mr uh perhaps it'll love just a second here let me get my
Representative Fredrick J. Love
Unverified
6:13
okay give it a try thank you mr chair now miss steel can i understand explain this they're going to file a complaint in court so that their charter would not be revoked but are they are they making any progress in correcting the outstanding issues uh sir the it's the state that's making
Speaker 19
6:32
the complaining court to begin the process to revoke the charter okay i'm i'm sorry i probably wasn't clear on
Speaker 21
6:42
that okay all right i just misunderstood and so
Representative Fredrick J. Love
Unverified
6:45
um it has all port made any any um progress towards anything we haven't been back since
Representative Mary Bentley
Unverified
6:54
that point um after this process started in november of 17 i believe and so through this whole time you know every every time we've been there every time it's been time for the committee to decide whether to continue the process we try to check to see if they've made progress and after september we i don't know that we've been back to check on it now remind me have we
Speaker 26
7:22
had the the mayor or any of the council members here for allport not recently because you
Speaker 19
7:28
know we've had no guests since covid started and before that in order to invite someone to the
Representative Mary Bentley
Unverified
7:33
meeting it has to be a the same finding on the same official like two reports in a row and they changed officials so we wouldn't have really had a repeat finding of course the meetings are open if they wanted to come and i think they did come at some point but i would have to look back at my records to see
Speaker 18
7:57
um but they have been notified of every meeting and they've gotten letters every step of the way
Representative Danny Watson
Unverified
8:12
okay okay thank you thank you representative any more questions uh from the committee in reference to this particular one on the city of albort okay no further uh we're going to go ahead and go on to
Speaker 10
8:29
um if you look at number two on your list and it starts on the second page i believe
Representative Mary Bentley
Unverified
8:36
of your synopsis we have an investigative report on new beginning center for alcohol and substance abuse and jimmy lock is here to present that one and if it's okay we're just going to let him go first so he can um get out of here and i would just like to say that i appreciate the last two years of mr watson and mr cooper uh chairing the committee it's been a pleasure to work with both of you thank
Speaker 34
9:02
you very much appreciate it thank you like thank you also
Speaker 40
9:07
mr lock you recognize okay thank you mr chair we did an investigative report on a new beginning center for alcohol and substance abuse it's a rehab center in a rehab facility in Warren that serves a 10-county area in southeast Arkansas. They began having some financial difficulties in 2019,
and we were asked to examine the records to see if those financial problems were possibly the result of fraud. I requested financial records for 2019, and to be honest, we didn't get a whole lot. the director that was there during our review period retired in October of 2019 and the new director didn't start until March of this year so she wasn't familiar with their the former administration's bookkeeping procedure she didn't know what type of records they kept or anything
like that so she was unable to locate a lot of the records that we requested. Due to this lack of records, we were unable to determine if all revenue was deposited or if all disbursements were for proper purposes. We did look at the few invoices that were provided and found about $400 that we considered to be questionable, but there weren't any major problems found.
then looked at their audited financial statements for the past several years and we determined that revenue from federal grants decreased approximately $460,000 in 2019 while their expenses stayed about the same. So if you're spending the same amount of money but your revenue is almost a half million dollars less that's going to most cases cause some problems. so due to the lack of records we can't definitely say that there wasn't any fraud
but it appears that the their financial difficulties were the result of this change excuse me change in funding rather than any kind of fraud the only other thing that we noticed was possible improper housing provided to the former director he was living in a center-owned house in 2019 and when i looked at the center's budget there was a line item for anticipated rent revenue
of seventy two hundred dollars however there was no rent actually collected and also even though he was living in the house the center was paying all the utilities it seemed to be common knowledge that even among the board members that he was living there so i don't think it was a secret but we were unable to locate any kind of written agreement indicating whether or not he was supposed to be paying rent or reimbursing the center for the utilities.
And that's about it. I will say I talked to the director that's there now a few weeks ago, and I think they've reduced their spending to account for the or make up for the lack of revenue or decrease in revenue. And according to her, they're no longer having those financial problems. And that concludes my report. Thank you, Mr. Logg.
Representative Danny Watson
Unverified
12:54
It appears there's a lot to delve into here, and I appreciate the diligence that your body did upon this, so that's
appreciated. Okay, next on the agenda, at this time, Tim
Jones from LEG staff. We'll go ahead and start getting into the list of ones that we're going to be hearing today.
Whenever you're ready to begin, go ahead, sir.
Speaker 46
13:25
Okay, thank you, Mr. Chair. We'll begin at the beginning of the synopsis on page one,
Speaker 47
13:31
and we have one report that's certified to the bond board, the city of glenwood for 2019 there is a finding for the police chief in the police department there was unaccounted for cash of almost 900 dollars and if you have any questions we would do our best to answer those questions any questions committee members
Representative Danny Watson
Unverified
13:57
city of glenwood okay looks like no questions uh let's defer to move over to
Speaker 50
14:15
the next one okay on page four we begin our reports that were referred to the prosecuting attorney at the top of the page uh city of centriston for the year 2019 we have a finding for under
Speaker 47
14:29
the mayor where an employee was allowed to use leave before it was accrued resulting in a salary overpayment of
Representative Danny Watson
Unverified
14:42
$620. Any questions committee members city city of Centerton? No
questions deferred move it over to the
Speaker 50
14:52
next one. Next is the city of Clinton for 2019 we have an unauthorized withdrawal finding we've
Speaker 47
14:58
had several of these in the past where someone outside the
cities have been obtaining the city bank routing and account information and issuing checks on the city's account and anyway the the monies have been recovered from the bank
Representative Danny Watson
Unverified
15:18
for the city of or the explanation we have
Representative Fredrick J. Love
Unverified
15:32
a representative love go ahead sir i just i just wanted to to clarify um since
Speaker 58
15:37
we're not since we're not getting any
objections are we are we filing all these reports so far
Representative Danny Watson
Unverified
15:44
if there are any uh okay you know you will handle that on that matter okay so far in fact i stand to be corrected on the previous three i said deferred and i stand to be corrected and they are filed all right but but that is correct okay i just want to clarify thank you sir no questions on this one file over to
Speaker 50
16:06
the next one okay city of forest city for the year 2019 for the clerk treasurer there was a clerical error
Speaker 47
16:13
and ended up having an overpayment of around fifteen hundred dollars and that money has been reimbursed by the clerk treasurer any questions on forest city matter filed next city of
Speaker 50
16:29
lepanto for 2019 we have an ethics issue where the uh council member served as a part-time officer and they didn't have an authorizing ordinance questions all up onto matter filed
Speaker 47
16:46
okay the next page the city of morilton for 2019 have a finding for the mayor and airport commissioner. They had a balance around $48,000 from five individuals and one of those was the airport commissioner. This balance was for airport hangar fees and this resulted in an Arkansas Constitution Article 12, Section 5 issue and that finding is going to the prosecutor. Questions on City
Speaker 46
17:19
Moralton? No questions. A matter of file.
Speaker 50
17:30
And continuing with reports that are going to the prosecuting attorney, City of West Memphis, 2019, we had some
Speaker 47
17:39
improper disbursement findings. One were $9,715, some for undocumented expenditures and so forth. And then also there was $4,800 in credit card expenditures at the bottom of the page.
some of those have been reimbursed on the next page still under the mayor and the treasurer finance director there were more credit card expenditures that were in violation of article 12 section 5 public purpose kind of issues over those were improper expenditures and we also had um a finding for the
Speaker 50
18:17
mayor where a the city sold a um 2004 crown victoria to a former mayor
Speaker 47
18:27
and um it he took a while to repay to pay for the for the
Representative Danny Watson
Unverified
18:40
car okay we have a question i believe uh who at seat 91 raise your hand raise your rice senator
Senator Terry Rice
Unverified
18:50
rice okay go ahead sir just question on the city of west memphis has there been previous findings this was all uh from uh january 19 to march or 20 was if we had previous
Speaker 68
19:04
reports on them i'm trying to remember back these there weren't any uh these particular issues weren't repeat for the 2019
Senator Terry Rice
Unverified
19:16
report okay but as as many of them as there is and you're saying this is referred to prosecutor yes sir which we don't see much done in most cases uh again you know even though it's uh ninety seven hundred dollars it's it's not a big amount of
money but the the number of different things is concerning is there anything that is heightened uh in the way of audit scrutiny on something that has this many findings well when we traditionally when we find any
Speaker 47
19:55
issues like this we increase the amount of transactions that we look at okay and so um that's just kind of how that works we find something we
Speaker 68
20:08
start looking for more and that answer my question because the number
Senator Terry Rice
Unverified
20:12
of these things and if you take more samples you know that they need to clean it up
Speaker 72
20:17
but it at least you you'll be looking they'll know you will be thank you thanks senator rice seat 91 who will be
Representative Danny Watson
Unverified
20:28
seat 91 maybe not were there any
more were there any more questions on this particular one
Speaker 75
20:38
yes go ahead uh senator this is more of a general uh question but uh there is a point and this i guess is to the auditors uh there's a there's a point that it rises from a misdemeanor to a felony based on the amount of money involved. Do you know where the breakover of that is?
Speaker 76
21:06
I don't know off the top of my hand.
It's relatively low, though. I want to say in some cases as low as $500 or $1,000. Okay, I was thinking it
Speaker 75
21:16
was quite a bit higher than that, but I could be wrong about that. So anyway, that's just a thought that I had. Thank you. Thanks, sir.
Representative Danny Watson
Unverified
21:27
thank you mr chair any more questions on this particular one committee members or anybody okay without objection okay we
Chair
Unverified
21:40
representative gonzalez go ahead thank you mr chair um just real quick on senator cooper's question i believe the answer is a thousand dollars on that because i just had a conversation this morning with the glenwood mayor and the reason that he couldn't get that almost nine hundred dollars investigated was because it was below that thousand dollar limit what i what i was told so i think that's i believe that's right um but i had a question on on the finding here uh their general fund records we're talking about significant amounts of money there can you
can we get a little more detail on exactly
Speaker 47
22:18
what happened there these were misstatements in the financial records um they uh didn't have some receivables and payables recorded correctly or maybe not recorded at all they had some classification errors and posting errors and this is um accounting auditing standards requires us to write a finding like this when we find a lot of errors in their their in accounting records and their postings
Chair
Unverified
22:44
so do we know if they've since corrected that i mean again that's significant numbers that i'm looking at there on the bottom of age six
Speaker 47
22:53
well what we do know for that particular year is the the city has to sign off on the financial statements we give them a copy of the financial statements when we exit and so they have to agree that our what we're handing them the adjustments are correct so with the financial if you go to the city of west memphis report and look at the
the financial statements those financial statements have been adjusted and they're recorded properly there and hopefully they um you know
Speaker 81
23:23
from the the findings they learn and make the corrections in the 2020 year okay thank you
Representative Danny Watson
Unverified
23:30
thank you representative gonzalez any more questions committee members am i missing anybody make sure you do raise your hand up good it is rather okay representative
love just one second here go ahead
Speaker 87
23:46
sir thank you mr chair um on this one um so
Representative Fredrick J. Love
Unverified
23:50
let me let me clarify are we stating that
there there was no funds that was missing they were just they were just either misstated or Well,
Speaker 50
24:01
Mr. Gonzalez was asking about a finding that we didn't bring up because it's in here because it's one of their findings, but
Speaker 47
24:13
we're not discussing it because it's not going to the prosecuting attorney. They did have some, the
Speaker 50
24:18
ones that we discussed that were, they had the credit card charges within proper disbursements and so forth. Those are going to the prosecuting
attorney those are considered improper use of funds
Speaker 47
24:31
now the accounting errors on the findings that uh mr gonzalez asked about those are not going to the prosecuting attorney okay so so and then
Speaker 23
24:39
that's what i'm that's i guess that's what i'm asking in accounting in the accounting errors are
Speaker 92
24:44
we are we saying that there's that there was no money missing they they were just errors are we saying that there was money missing uh
Speaker 94
24:54
those were just errors where you've got those large amounts those were accounting errors okay
Representative Fredrick J. Love
Unverified
24:58
all right i that's that's what i wanted to to know
and and mr chair i would like to go back just to the last one just to ask a clarifying question when the airport commissioner is turning the bill over to the city clerk's office what does that what does that mean as far as what exactly does that
Speaker 92
25:21
mean? Go ahead, Mr. Jones. Does it mean that they're taking further action about this? Well, the airport
Speaker 47
25:28
commissioner, the way I take it, was collecting the monies.
And so now he's not going to be collecting the monies any longer. Now the city clerk will be collecting the monies. Okay. Okay. All right. Thank you.
Representative Danny Watson
Unverified
25:45
any more questions committee making sure not missing anybody without
objection we will file this report proceed okay we'll move
Speaker 50
26:03
to the town of banks at the top of page eight for the years uh town of
banks for the years 2019 and 2018 the mayor has under the mayor there's an ethics finding where the town paid money
Speaker 47
26:16
to the to the mayor for mowing without an authorizing ordinance in conflict with the ethics law there are no questions we will we will
Representative Danny Watson
Unverified
26:30
file this without objection we will file this report okay next one at
Speaker 50
26:38
the bottom of page eight it is a city of k
Speaker 47
26:41
city for the years 2019 and 18
and this is another unauthorized withdrawal findings where the money has been recovered from the bank committee members
Representative Danny Watson
Unverified
26:54
heard the explanation about objection we will we will file this report okay continuing
Speaker 50
27:02
with reports referred to the prosecuting attorney top of page nine of the city of diamond city for years 2019 and 18 um the mayor has a finding where he
has paid a couple of organizations in non-compliance with the arkansas constitution article 12 section five
Representative Danny Watson
Unverified
27:29
no questions committee without objection we will file
Speaker 50
27:34
this report all right continuing on page 10 the town of franklin for the years 2019 2018 2017 we have an ethics finding
Speaker 47
27:47
where the mayor paid a council member without an ordinance
they did they passed in the council minutes evidently but they did not pass an ordinance to do so and
Speaker 51
28:01
this is a repeat finding going back to 2015 no questions committee
Representative Danny Watson
Unverified
28:11
members without objection we will file this report oh and
Speaker 47
28:16
um there were three more findings on the town of franklin to the to uh another repeat finding going to prosecutor excuse me it's just a repeat finding they had
um they didn't file the water department uh report correctly they had an aup but no compilation report with that and on the next page the recorded treasurer didn't have the bank reconciliations approved by someone other than this person preparing the reconciliation and their fixed asset listing was not in compliance with the code so that's also on the town of franklin okay
Representative Danny Watson
Unverified
28:55
we have heard the explanation on the other two findings on the city of franklin city of franklin
any questions committee members okay we have one go
Representative Fredrick J. Love
Unverified
29:16
ahead uh representative love thank you mr chair
so since these are repeat findings what can you recall the first response that you received when when we we got this initial when we got the initial finding regarding the bank reconciliation,
what was the actions that they took to correct
Speaker 47
29:46
it? What we have in their response is that they're going to have the mayor or council member approve the bank reconciliations after the treasurer performs them.
Representative Fredrick J. Love
Unverified
29:58
Okay, but the last time that we did this audit, was the response the same
or was it different?
Speaker 47
30:10
I don't know if the response was the same or not. We could go back and look at those work papers
Representative Fredrick J. Love
Unverified
30:18
possibly. okay i mean i would just be interested because if they said that they were going to that the mayor and the city council was going to approve it the the last time that they had this this finding i would just be interested in in seeing what they said thank you thank you mr chair
okay yeah yes sir we have right we can't get to that answer right now because we have
changed work paper system and so the prior report it takes us a we can't get to those immediately so we'll get back with you on that but I will say this all the findings we issue get a response
Speaker 47
30:57
so in some way they told us they were going to correct this issue last time we don't know exactly yeah and that's what that's
Representative Fredrick J. Love
Unverified
31:04
I guess that's what I'm trying to get at is I just want to make sure that they're not telling us the same thing you know that this is how they're going to correct it
with the same action that they said the last time that we had this finding that that's that's what i was
Representative Danny Watson
Unverified
31:26
more interested in thank you mr chair representative
Representative Fredrick J. Love
Unverified
31:29
this uh explanation suffice for you yeah yeah it's it's efficient i just i
Speaker 47
31:37
just was yeah it's efficient okay representative love um marty just reminded me you know these are findings where usually we
would have the officials here to answer questions and we don't now because of covid we haven't been inviting the officials because of that so in the future okay thank you thank
Representative Danny Watson
Unverified
31:55
you representative were there any more questions i'll make sure i didn't accidentally delete somebody off my chart everybody good okay without objection we're going to go ahead and file this report on to the next
Speaker 46
32:07
one okay uh bottom of page 11 uh town of jerome for the years 2019 and 18 uh finding for the
Speaker 50
32:15
mayor the town's paying utility and insurance on a building without a contract and an apparent conflict with the
Speaker 47
32:22
arkansas constitution article 12 section 5
Representative Danny Watson
Unverified
32:28
you heard the explanation any questions no questions without objection we'll file this report on
Speaker 50
32:36
to the next okay continue with reports referred to the prosecuting attorney at the top of page 12 the town of omaha for the years 2019 2018 2017 the town uh improperly dispersed 7 500 to the water supervisor
Speaker 47
32:52
um you can see the details there one is they they paid for a trailer from him for $6,500 and then they they sold the trailer for a thousand dollars less later and then they paid almost $1,100 for the water supervisor's personal lawnmower and allowed him to continue to use it committee we have heard
Representative Danny Watson
Unverified
33:21
the explanation on the city of
omaha any questions without objection we'll file
Speaker 50
33:32
this report okay continuing on page 13 for the city of picket 2019 and the city of plumberville 2019 and 18 we have an authorized withdrawal findings in both
Speaker 47
33:43
cases the city's recovered the money without
Representative Danny Watson
Unverified
33:50
any questions without objection we'll file this report okay
Speaker 50
33:56
on page 14 the city of taylor for the years 2019 and 18
um the mayor made some expenditures in conflict with the public purpose doctrine and Article 12, Section 5 of the Arkansas
Speaker 47
34:12
Constitution. Any questions, committee? Without objection,
Representative Danny Watson
Unverified
34:20
we'll file this report. Okay. On to
Speaker 50
34:27
the next. Lincoln County for the year 2019, finding for the county judge.
The county paid $11,000 for gym memberships in conflict with the Arkansas Constitution, Article
Speaker 47
34:40
12, Section 5. We heard that explanation on the Lincoln County.
Representative Danny Watson
Unverified
34:46
Any questions, committee members? Without objection, we'll file this report. Next. Yeah, and again, I got a
Speaker 47
34:54
little bit of a hurry. On the next page, there were a couple of findings as well. One for the sheriff. the the sheriff had some employees that worked 12 hours and received the 12 hour days and received
more hours of vacation leave than the other employees in conflict with the personnel handbook and the county clerk's office and there were a couple of employees who were paid after they had left the county employment and one of those has refunded the county we have heard the additional
Representative Danny Watson
Unverified
35:31
findings for lincoln county any questions without objection we will file this report prairie county
Speaker 50
35:39
on page 15 for the year 2019
we have first finding for the county judge the county dispersed forty six hundred dollars without an ordinance to a business owned by a board equalization member and a spouse
Speaker 47
35:56
of the of the sheriff's deputy and the county had a bank account that they were the judge did that they were collecting money for people in need but they did not process the money as the the county
financial laws require okay any questions
Representative Danny Watson
Unverified
36:22
committee members on prairie county without objection we'll file this report okay on
Speaker 50
36:35
page 16 we begin reports with repeat findings in independence county for 2019 at bottom of the page the sheriff has a finding for at a commissary bank account with the balance of
Speaker 47
36:47
seven almost eighteen thousand dollars and ending balance was not identified and a similar finding was issued in the prior report
Representative Danny Watson
Unverified
36:59
we've heard the findings for independence accounting we have any questions committee members without objection we'll file this report uh stand to be corrected just one second uh uh representative gonzalez go ahead sir thank you mr
Chair
Unverified
37:15
chair so what's what's next in the process for
this this is just repeat findings as of now will this be turned over the prosecuting attorney or is the money actually missing it's just wasn't identified what yes the
Speaker 50
37:30
money wasn't identified so this is a finding that won't be turned over to the prosecuting attorney there
Speaker 47
37:37
wasn't no money was missing per se that we could tell and uh and this is really proper accounting procedures here the state law requires a lot of bank balances to be identified
technically didn't hear in the commissary but that's good accounting practice and so that's why we wrote we've written this finding okay thank you thank you
Representative Danny Watson
Unverified
38:05
representative any more questions see enough other questions uh we will
Speaker 47
38:11
file this report on to the next okay the top of page 17 jefferson county for
Speaker 50
38:17
the year 2019 um there were some county road funds that were used for bonuses for the sheriff's department
Speaker 47
38:25
and non-compliance with the state code and there were some funds like this from the prior year as well, and so there's a balance that is at the report date of $29,000 that was due to the road fund. Any
Representative Danny Watson
Unverified
38:44
questions, committee members? Senator Cooper? So what did they say
Speaker 75
38:47
they were going to do about that? They said that they would refund
Representative Danny Watson
Unverified
38:55
the money from the general fund to the
Speaker 50
39:09
road fund. Okay. any more questions committee members that objection will file file this report okay continue the town of
Speaker 47
39:20
beatable for 2019 2018 2017 the recorded treasure fixed asset listing didn't include asset additions
deletions and totals as required by the code
Representative Danny Watson
Unverified
39:31
heard explanation on town of beadville beadaville i guess beadaville okay appreciate it we don't have any questions without objection we'll file this report okay city
Speaker 50
39:46
of chidester at the top of page 18 for the and this is for the years 2018 and 17
Speaker 47
39:52
we had two findings for the mayor one is they didn't I haven't turned in an audit for the
water and sewer system since 2011 and
Speaker 62
40:03
general fund expenditures exceeded the budget or the explanation
Representative Danny Watson
Unverified
40:10
on the city of Chittister any questions committee members seeing none without objection will file this report city of
Speaker 47
40:21
dyer for 2019 the general fund expenditures exceeded the budget by almost 111 thousand dollars no questions without objection will
Representative Danny Watson
Unverified
40:33
file this report but we do have a question uh sorry
Representative Fredrick J. Love
Unverified
40:38
Representative Love. Go ahead, sir. Thank you, Mr. Chair. So I'm reading the response that says that the overspending came from not including payroll on their budget. I guess I'm at a
loss as to when you all reviewed this, what did you find? Did you find that the payroll was not included in the budget i don't understand how you can do a budget and not have a payroll included but
can you can you further clarify what we do when we we take
Speaker 47
41:19
a look on every city that we do we take a look at the the budget especially for the general and the street funds and we compare those expenditures uh to the total expenditures they budgeted so it's a very broad this is a very broad test, and so I don't have those work papers for Dyer in front of me, so I don't know how accurate that response is. I'm not sure if we're able to see those work papers on Dyer for 19,
but that's what they told us. A lot of times, we'll see all kinds of things. People will forget about getting a grant and they'll forget
Speaker 108
41:59
to budget for those expenditures but that does that's quite a bit
Representative Fredrick J. Love
Unverified
42:05
of money for yeah well no that's what i'm saying for a town of 876 people 111 000 is quite a bit money especially it's almost 50 percent over their their budgeted appropriation uh mr chair can we can we hold this for staff to kind of do further
review of this because this right here is a little alarming for for a town to exceed almost uh their budget
Speaker 58
42:32
by almost 50 percent correct representative uh love we will uh staff will do
Representative Danny Watson
Unverified
42:42
this uh and they'll they'll check on it follow up and uh report back to the to the to the body and we'll make sure that you have this
information will that suffice okay thank you yes okay you're welcome
Speaker 137
43:02
uh representative rye you're uh you're recognized sir
sir yes sir thank you mr chairman basically on on the same track as uh representative fred i just wonder about this 110 000 dollars uh it let's just say that they were working a budget up uh for the previous year for the this year that we're looking at
how did they pay it unless they had some relief funds or rainy day funds wonder wonder how they paid that they had cash i would
i would presume that they had cash to cover it you know cash
Speaker 110
43:40
in the bank and what you spend doesn't always you know agree with
Speaker 84
43:53
the budget well it don't make sense to thank y'all okay thank you representative any more questions uh representative watson the uh
Speaker 75
44:00
you know i think representative rise right on there either there was some terrible budgeting going on or or or some checks bounced one or the other so uh i don't see in here where checks were bouncing so that leaves the other excuse one more time please you
recognize go ahead um thank you mr chairman uh it just makes you wonder y'all because if you didn't have some
rainy day money or some relief funds you know being compiled from years back you just kind of wonder how they even paid paid this don't you exactly
Representative Danny Watson
Unverified
44:43
and i appreciate the the comment that absolutely is a red flag uh thank you mr chairman you can bet your follow-up will occur on this one for sure any more questions representative
Representative Justin Gonzales
Unverified
44:58
gonzalez sir you're recognized thank you mr
Chair
Unverified
45:01
chair i guess i have a more of a procedural question for us whose decision is it to not have the public invited or these these particular people invited in here it seems like we have the room to properly social distance if we need to um and to just be honest with you this seems kind of pointless to me without having anybody here to answer questions seems like we're just going through the motions to file these things and if that's what we're going to do and not be able to ask questions then i mean we ought to just batch them all and file them and you know we're going
through this this process in my opinion um so i would i would like to see if we have the ability to to hold these and and invite these people in back in at some point to come answer these questions and you know actually get something done hopefully
Representative Danny Watson
Unverified
45:56
we'll have a answer right here go ahead Miss Steele would you advise
Representative Mary Bentley
Unverified
46:03
something since COVID started that's just kind of been what I understood was the
the policy that Mr. Norman wanted us to not invite guests just not have because typically we have so many people invited but if there's any that you want to we can defer them and then April is our next scheduled meeting and we could invite them to come at that time i mean that would that would be at the pleasure of the committee
Chair
Unverified
46:35
yeah i mean i guess i'd defer back to the committee on that but my personal opinion is
that we we should hold these things and wait till we can have these people in front of us to answer some of these questions but i'll defer back to y'all
Representative Mary Bentley
Unverified
46:52
well again you know and when we get to after tim goes uh to the report if they're if on that particular one you think you want somebody to come in and ask your questions you guys can always just um move to defer it rather than file it and and we could invite those
Speaker 146
47:06
people to come to the next meeting representative gonzalez
Chair
Unverified
47:13
yeah i mean i guess my only thing with that is if if our next meeting is not going to be for a while I mean, some of these people on this committee may not even be coming back, so they might not have the opportunity to ask the questions that they have now. But you're saying that the committee does have the option to invite these people. That is completely up to us as a committee as to whether or not we invite them in.
Representative Mary Bentley
Unverified
47:44
Yes, sir. Typically, before all this craziness started, anyone that had a repeat finding was invited. automatically invited now the ones that just had findings referred to the prosecutor we read those but we didn't necessarily invite those people unless it was repeat um and the other committees are a little bit different because they don't have near the volume that we do and i think that's one reason that um the first meeting we were going to have we were going to have like 30 people to be invited and that was going to be way too many to socially distance and since then we've
just kind of continued that because the last meeting was huge too um this one might have been better and we might should have thought about that a little bit more um but that that's why we haven't invited
Chair
Unverified
48:31
people okay so we would also have the option to split those up and and have a couple of different meetings throughout the our audit week too or is it would would
Representative Justin Gonzales
Unverified
48:42
that not be a possibility that i don't know we'd have to talk to
Representative Danny Watson
Unverified
48:47
mr norman about that okay all right thank you thank you representative gonzalez uh representative love you recognize sir
Representative Fredrick J. Love
Unverified
48:53
um we'll try it again try it okay thank you
Speaker 58
49:06
mr sheriff and representative gonzalez brings up
Representative Fredrick J. Love
Unverified
49:09
a good point i i guess what i would i would say on the same line that he's thinking for those that that have these repeat findings i think we do need to get some questions answered before we file these reports um going through the the ones that would that just have initial findings that that's fine
but for the repeat findings i do believe that i mean if it's not if it's not just um um an
Speaker 58
49:38
emergency that we filed these reports i think we we probably should hold them until we can get um some of the mayors and the county judges in here to to actually answer uh the questions that we have so um you know if it's the pleasure of the committee to to continue to hear hear these then i mean that would be fine with me but i would i would actually uh like for
us to have the officials come, especially these that are repeat findings that, you know, such as the city of Dyer, if this is a repeat finding and this time it's $110,958, what is the next time? So it would probably be good to hold these reports and if there's not just an emergency that we have to have them filed so that we can get some questions answered
Representative Danny Watson
Unverified
50:36
thank you representative love whatever the pleasure of the board like was explained mr senator cooper go ahead i
Speaker 75
50:51
would make one suggestion in in considering that whether it's a repeat finding and the amount is and and a committee member a committee member asked for it to be deferred rather than just do it on a blanket because I think you're probably going to get some
things in there that you wouldn't necessarily want packaged in there if you just make it blanket but that's just my suggestion that that a committee member ask for it to be deferred on a case by case basis which i think yes i think you're on target right here i i agree with you that you know when you're looking at almost 50 exceeding budget well somebody needs to answer those questions thank you thank you senator uh miss steel
Representative Danny Watson
Unverified
51:38
go ahead i would just like to say
Representative Mary Bentley
Unverified
51:43
the next meeting is not going to be until april and so we'll have a lot of people in between that too and i guess we need to get clarification on whether or not we need to invite all the people that have repeat findings between now and then to come which again that's able to be a whole bunch because it's going to be you know five months worth of reports but we'll need to know in time to send them letters to let them know they need to be here if that's what we need to do
Representative Danny Watson
Unverified
52:14
committee members uh i want to say are you good with uh with this thought is what i want to want to ask was there one more question by a committee member that i don't want to make sure i'm not missing anybody anybody else in the queue if you will just raise your hand okay uh senator go
Senator Alan Clark
Unverified
52:43
ahead and try it yes this is uh i don't not being critical of chair or staff we've had to
work our way through this pandemic and find out how things were going to work but i'd like to echo representative gonzalez that if this process is going to mean anything then if we need to break if we need to break up and have multiple meetings uh we already have enough problems having served on the Audit Committee since I first got here with it seemingly sometimes being meaningless that people get cited and then do nothing to change it. So I would hope that, again, if we have to have three or four meetings,
that we bring the people in that need to be brought in. I just want to go on
Representative Danny Watson
Unverified
53:26
record. Thank you. Thanks, Senator Clark. with that being said i'm not going to assume anything but uh mr jones that will be the route to keep this from going on and on and on to to head this off and let not let it fester anymore
Speaker 156
53:51
anything else on that so can just to be clear do
Speaker 7
54:01
we need need to defer just certain ones from this list that we have now that's what
Speaker 92
54:09
i would think is that we would just defer the ones for the repeat findings because there's
Representative Fredrick J. Love
Unverified
54:15
still there's still business from page 24 on the 34 that we could that we could take up but But pages 15, I think that's when the repeat findings.
Representative Mary Bentley
Unverified
54:26
And there were also, Representative Love, there were also some repeat findings mixed in with those referred to the prosecuting attorney. So is the committee wish to defer all the ones that had any kind of a repeat finding, or are there just certain ones? Representative Gonzalez, go ahead. uh are you 89 go ahead sir
Chair
Unverified
54:59
there it is okay um in light of what's being said here i think i'm just i'll just go ahead and make a motion to hold all of the repeat findings over to to the next meeting and let you know whoever the chair is the time decide if that needs to be split up into a couple of different meetings to
handle that or however that needs to be done but i'll make a motion to hold all the repeat findings
Representative Danny Watson
Unverified
55:43
to the next meeting we have a motion by representative gonzalez to hold all repeat findings on this batch that we have been going over to the very next meeting
we have a motion we have a second representative rye all in fit all in favor signify a lifted hand those opposed like sign motion carries thank you representative gonzalez okay go
Speaker 47
56:23
ahead okay we'll continue we'll continue with the town of mcnab on page 19 these are still reports with repeat findings um there's a finding for the mayor a quarter
treasurer where state aid funds um for uh for for streets were used for other purposes and um as of december 31 2019 the general fund owed street fund 62 000 and 59 000 respectively and the town previously agreed
to repay the street fund $300 per year but no payments have been made since 2013.
Representative Danny Watson
Unverified
57:06
All right, the information on the city of McNabb, any questions? Without
Speaker 47
57:20
objection, we'll file this report. City of Sulphur Springs on page 20. we have a finding for the mayor where they have a balance of $14,000 in the general fund but the city owed significant amounts to the IRS and to other funds at December
31st 2019 and when these outstanding amounts were considered the general fund had a deficit balance of $227,000 in the water and sewer fund, even though we didn't include this in the report, would have a deficit of $58,000 based on information provided by the city. And the general and street fund expenditures
exceeded the budget by $92,000 and $15,000.
Speaker 47
58:47
Okay, since the committee has voted to defer the repeat findings, I'm going to move down to the reports with findings and no responses on page 22 and we had four water department audits that we didn't have responses when we
printed this synopsis but we've received responses this week on all of them but turrell and the staff is contacting turrell to to get a response and staff recommends we we file these reports
Representative Danny Watson
Unverified
59:35
any questions on this particular one committee
Speaker 50
59:45
members without objection we'll file this report on page 24 begins a
Speaker 47
59:50
list of um 22 reports uh with findings with responses and this uh these reports
go from page 24 to page 31 we'd be glad to try to answer any questions you may have You will, committee members, spend a
Representative Danny Watson
Unverified
1:00:10
little bit. Just go ahead and scan these and see if there's anything that you want answered.
whoever's in seat 13 you're recognized go ahead our representative representative hodge okay try
Representative Monte Hodges
Unverified
1:00:43
it again okay thank you i'm sorry uh thank you uh mr chair i'm not on this committee it's okay could i go back to the city of turrell to deter just a question i have what what is it that you're needing from the city of turrell actually on
Speaker 47
1:01:04
page 23 uh we just haven't received a response from turrell but we are contacting them and
generally the the cpas get us a response and this is the only report we don't have a response for the water response for this is a water department um report okay they had three findings for their accounting records and we're pretty confident we'll get a response from them okay all right thank you thank you representative thank you do we have
Representative Danny Watson
Unverified
1:01:38
another one uh c20 we have another question committee member i'm missing
okay we have no objection we're going to file this report on to
Speaker 50
1:01:52
the next one Okay. On pages 32 through 34, we have 75 reports with no findings, and staff would recommend
Representative Danny Watson
Unverified
1:02:04
we file these reports. Okay. Seat 20. Seat 20, is that represented a fight? No? No.
What say again? I didn't understand you. thank you
Speaker 175
1:02:29
right thank you mr chair hey uh it got by me a while ago but the city of mcdav there on
Speaker 176
1:02:37
page 19 um it appears to me and this is a question for staff it appears to me it's been maybe close to two decades before they have spent their
their street fund properly and they've committed in the past to make payments they've done none of the above they continue to spend the money how they want to and am i misreading anything in that the same thing i said was
Speaker 87
1:03:08
not correct no so they're they're spending monies
Speaker 47
1:03:13
that's uh restricted seem restricted property tax and state tax monies that are restricted for streets on other
Speaker 176
1:03:20
other purposes okay do you know if they're spending
anything on their streets um i don't have the financial statements in front of me i would
Speaker 176
1:03:31
assume that they're spending some yes okay would you know if they would have uh municipal streets or would could there's would you know the answer to that when we send money to them do we know that they have streets in which to
Speaker 10
1:03:48
maintain sir just from driving through mcnab they have a few i think well mcnab i'm thinking of fulton
Speaker 103
1:03:54
mcnab would have very few i'm sorry miss steel i'm having
Representative Mary Bentley
Unverified
1:04:00
a hard time hearing you i apologize oh that's fine i'm trying to share a microphone here um just from driving through mcnab they would
Speaker 146
1:04:10
have very few paved streets. I mean, they've
Speaker 176
1:04:13
got to, I know there's a... Okay, you know, I know they use the excuse, well, that was the last administration who did that. But this would appear to me, this is multiple, multiple years that this has been going on.
Do you know how far back it is on this
Speaker 7
1:04:34
particular one? well we say that they haven't made payments since
Representative Mary Bentley
Unverified
1:04:39
2013 so it's been at least that long okay um and if you'll look down on the under the mayor there's also a finding that they borrowed $2,700 to pay the county to pick up their trash which that's another you know they
can't borrow money for that either um I think McNabb's just got some financial issues um as you can tell by these findings um the second paragraph underneath the one you were looking at about the schedules one and two of this report show balances of 12,000 and 9,000 but then if you take into account these other things they're actually negative balances okay and sir we I don't know if you remember you requested us to keep a spreadsheet of the municipalities that yes i
remember um i have that updated through this report if you would like to have it at
Speaker 176
1:05:37
any time yeah that would be great if we could get it my question would be also without some kind of penalty through legislation this is not going to change it would appear to me that's just a statement thank you thank you mr
Representative Danny Watson
Unverified
1:05:53
chair well noted thank you representative representative fight was there a question uh seat 42 42 okay go ahead representative hillman uh
Speaker 182
1:06:04
i'll look at this uh what what options do we have can we hold their turn back funds until they comply with
this i don't know the provision in the law for holding turn back funds for misusing street funds so the answer is you don't know Well, the one provision that we do know of is for noncompliance with the substantial noncompliance with the municipal accounting law.
Speaker 47
1:06:35
This is not this that we write. We sort of write this up under that because municipal accounting law requires a bank account for a street fund if you receive a street turn back. But it doesn't really address the expenditure of funds there
Speaker 62
1:06:51
as far as state law goes. okay would it
Speaker 186
1:06:57
fall under the category of losing their charter that's the same
Speaker 117
1:07:02
thing that's okay substantial non-compliance with the municipal accounting law okay sound
Speaker 183
1:07:06
like this is something needs to be addressed in
Speaker 162
1:07:09
legislature then that's all I've got thank you
Representative Hillman representative Rye you're recognized thank you Mr. Chairman you know what What Representative Hillman is saying, and I believe Fied also, boy, this is pretty serious stuff because what you're doing actually statewide, you're implementing a half-cent sales tax, and a certain portion is going to the state. I believe it's something like 70%, and 15% is going to counties, and 15% is going to cities.
and what can happen here you're actually misusing taxpayers money here that they're paying a half cent on isn't that right Representative Fied yes sir thank you well noted Representative Wright thank you sir any more
Representative Danny Watson
Unverified
1:08:02
questions on more questions on this particular one with objection we'll file this report that's we've covered the reports okay
Speaker 66
1:08:17
okay looking back on to the agenda here everybody
Representative Danny Watson
Unverified
1:08:31
take note next meeting will be attended to levy april the 8th 2021 if you don't mind i'm going to take just a minute to uh uh acknowledge uh senator uh chair senator cooper uh i appreciate him having uh us
aboard having me on a board for uh this period of time and it's been my pleasure and i wish him nothing but the uh absolute very best been a most gentleman statesman i have seen
any more questions Any more thoughts? Committee members? Go ahead, Senator Cooper. I just want
Speaker 75
1:09:12
to tell this committee and the staff that it's been a pleasure working with all of you.
And as far as I know, this may be my last trip down here. And it's certainly been a good time for me. and I just want to tell the staff especially that how much we appreciate them in the state appreciates their work that they do and often time that goes unnoticed I think by some of us and some of the public too so God bless you all and wish you the very best God bless thank you Senator Cooper no further
Unknown speaker
1:09:55
BEFORE THE COMMITTEE. MEETING ADJOURNED.
Agenda
A. Call to Order by Chair
B. Adoption of Minutes of the October 8, 2020 meeting
C. Review of Reports (Refer to the Synopsis)
D. The next meeting will tentatively be April 8, 2021
E. Adjournment
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — LEGISLATIVE JOINT AUDITING - COUNTIES AND MUNICIPALITIES, Dec 3, 2020 | Agenda | 4 | Official source ↗ |
Speakers
Representative Danny Watson
Unverified
Representative Mary Bentley
Unverified
Speaker 10
Representative Fredrick J. Love
Unverified
Speaker 19
Speaker 21
Speaker 26
Speaker 18
Speaker 34
Speaker 40
Speaker 46
Speaker 47
Speaker 50
Speaker 58
Senator Terry Rice
Unverified
Speaker 68
Speaker 72
Speaker 75
Speaker 76
Chair
Unverified
Speaker 81
Speaker 87
Speaker 23
Speaker 92
Speaker 94
Speaker 51
Representative Johnny Rye Chair
Unverified
Speaker 62
Speaker 108
Speaker 137
Speaker 110
Speaker 84
Representative Justin Gonzales
Unverified
Speaker 146
Senator Alan Clark
Unverified
Speaker 156
Speaker 7
Speaker 163
Representative Monte Hodges
Unverified
Speaker 174
Speaker 175
Speaker 176
Speaker 103
Speaker 182
Speaker 186
Speaker 117
Speaker 183
Speaker 162
Speaker 66