Legislative Joint Auditing- Counties and Municipalities
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Speaker 432
0:00
I want to call the meeting to order, but before we get started, I want to ask Senator Dave Wallace to lead us in a word of prayer, please.
Thank you, Senator Wallace. Our first item on the agenda today will be the approval of the prior meetings of the minute, or minutes of the prior meeting. Second. All in favor say aye. Aye. All opposed? Passes. Joe, I want to turn
Speaker 8
0:54
it over to you, and we'll proceed. Thank you, Mr. Chair.
Speaker 10
1:00
Item C on the agenda is an update on our private reports, our delinquent
Speaker 11
1:04
reports from December 31st to 2022 for our water and sewer reports. Since our March meeting, we've had seven new reinstatements, which brings us to a total of 28 that have received their turn back or back or will as of June 10th. That leaves us with 15 that are currently having their escrow, their turn back escrow. That completes my report, Mr. Chair.
Speaker 10
1:31
Without objection, we'll file this report. Agenda item number D is an update on the delinquent 31-2023 water and sewer reports. We are down to four remaining that have not filed
Speaker 11
1:47
their reports. Staff note here, these individuals are not having their turn back escrowed currently. This completes my report, Mr. Chair. Without objection, we'll file this report.
Item E is a discussion of non-compliance with Municipal Accounting Code. We have five cities or entities that we need to discuss today. The first two were
Speaker 10
2:16
added to the 60-day clock back in February. The town of Denning, staff visited them on April 30th. And they reported back that their
Speaker 11
2:25
records have improved immensely. And staff recommends that we take them off the 60-day clock. And that's the same with the town of Gum Springs.
Staff visited them on March 19th. And their records were much improved as well. So those two, staff recommends that we remove from the 60-day list. So moved.
Speaker 432
2:53
Second. Motion passed, or excuse me, but I'll make a
Speaker 14
2:58
motion that we accept the report. The other three on the list, with the chair's permission, I'd like to
Speaker 23
3:08
Yes, yes, please proceed. Starting with the town of Fargo on page
Speaker 11
3:20
four of the synopsis. The Town of Fargo for December 31st, 2024, 23, and 22 under the Mayor. Accounting procedures for municipalities are set forth in Municipal Accounting Law in Arkansas Code Annotated 1459-101-119. The Town was not in compliance with these codes and other proper accounting procedures as noted below.
The budget was not adopted or maintained. Bank reconciliations were not prepared monthly. Financial statements were not provided to the town council. The annual financial statements were not prepared or published. Town council minutes were not maintained. Pre-numbered receipts were not issued for all revenues. Receipts and disbursement journals were not prepared. A fixed asset listing was not provided. Invoices and supporting documentation were not provided.
All disbursements were not made by utilizing pre-numbered checks or approved electronic fund transfer. Checks were not issued in subsequent order. This is a repeat finding. The governing body did not document the review, the prior report, or accompanying comments or action taken by the governing body as required of Arkansas Code.
Speaker 25
4:40
Mayor Derek Young was invited here today. The recorder treasurer's position has been vacant for some time now.
Speaker 27
4:49
Mayor Young notified us on the 28th that he was resigning and that he was starting the process to turn in the city's charter. We don't have any verification of this at
Speaker 11
5:00
this time because that was literally last Thursday. So staff would recommend that we defer this to give them 60 days, which is to the next meeting, which will be August, just to see where they are, and then we will take this up then. But that's
Speaker 432
5:15
staff's recommendation. Without objection, I'm sorry, Representative Dalby.
Representative Carol Dalby
Unverified
5:21
I just have a quick question. Could we, or
maybe it's not proper, but could we make a motion to start that process of not de-chartering or de-certifying them, but hold it in advance to see if they actually come through in 60 days because if we don't, then come 60 days, we're going to be back in this same spot and then we're going to be making that motion. And I'm just wondering, is that something that would be proper
that we could do that, hold it, let them make their decision as to how they're going to proceed
and then go forward? I'm just curious as to how others would think. If that's the will of
Speaker 11
6:01
the committee, that's certainly final staff. Is that a
Speaker 35
6:04
motion, Representative Dolphy? It is a motion, sir. Second.
Speaker 36
6:09
Any discussion on the motion? All in favor say aye. Aye.
Speaker 432
6:14
Any opposed? Motion passes. Can we go ahead and file that report as well? Yes, without objection, we will file that report.
Yes, Senator Johnson. Thank you, Mr.
Senator Mark Johnson
Unverified
6:34
Chair. Mr. Archer, that was over three years, 22, 23, and 24 for Fargo. I hate to phrase it this way, but were they any better in how they were handling their business in 21 and 20 and 19? I'm just, it's one thing to say you made a mistake and you didn't fix these things during these years. And then, but if it's, the longer it's not in compliance, the more I'm apt to follow through with the representative's point about that.
And I, not just because you said it, Representative Dalby, but because it's, how bad is
it is my question, I guess. And Mr. Archer, is there any evidence that you could add to that?
Speaker 26
7:16
Yes, sir. All those findings are repeat findings. So that means they were
Speaker 29
7:20
also in the previous report. Okay. I hear you. A side note, we had to subpoena the
Senator Mark Johnson
Unverified
7:31
the records. Mr. Chairman, I think that is significant that, you know, we've had
municipalities coming here before that they're doing their best.
I mean, you've got 57 people. Like I say, now you can't even find someone who wants to be recorder treasurer. I appreciate that. But at some point in time, you know, you have to decide if you're going to be a city or town, you've got to follow the law. And if you don't, well, you don't get to be one anymore. And I think we've been kind of, shall we say, loose about that. And, you know, it might
be one way you can kind of get out of trouble is to surrender your charter yourself.
so I don't know I'm I'm searching for how many how many times committee do we see this kind of problem and you know you'd think that you know what is they say that insanity is doing the same thing over and over again and expecting a different result so I'll end my discussion on that mr. chairman but I think we need to come up with some finality or at least you know I'm a big one on being consistent I don't want us
to treat one town tougher than we do
another one in the same situation so
Speaker 58
8:47
thank you Senator Johnson for your timely
Speaker 10
8:54
remarks the the next entity on the substantial non-compliance list
Speaker 11
8:57
is the This is the town of Lead Hill on pages 29 and 30 of your synopsis. Town of Lead Hill for December 31st, 2024, 23, and 22, under the mayor.
An audit or agreed upon procedure or compliance report was not obtained for the Water and Sewer Department as acquired by Arkansas Code. This is a repeat finding in
Speaker 10
9:25
the previous two reports. Staff note, we are currently, the state treasurer is currently escrowing Lead Hill's turn back because of the lack of water
Speaker 11
9:35
audit. Continuing under the record of treasurer, a review of disbursements revealed that supporting documentation was not maintained for the following disbursements in noncompliance to the Arkansas Code.
Almost $1,900, almost $1,000, just over $1,200 dispersed
Speaker 10
9:49
in 24, 23, and 22, respectively, due to the lack of documentation. The validity and propriety of these disbursements could not be determined. Just over $700, almost $1,000, just over $800 disperse
Speaker 11
10:04
in $24, $23, and $22 respectively to vendors that appear to be for legitimate business purpose. However, supporting documentation was not available.
This is a repeat finding in the previous five reports. Continuing on page 30, accounting procedures for municipalities are set forth in the Municipal Accounting Law, Arkansas Code, annotated 1459-101-119. The town was in noncompliance with these codes as noted below. A detailed fixed asset listing was not maintained to include additions, deletions, and control totals. This is a repeat finding in the previous five reports. All disbursements from municipal funds were not made with pre-numbered checks,
and electronic disbursements were made without an established electronic fund transfer policy approved by ordinance. This is a repeat finding. Cash receipts and disbursement journals were not properly maintained. Pre-numbered receipts were not issued for all items of income. These are both repeat findings. Bank reconciliations were not properly prepared for all bank accounts or approved by a municipal official or employee other than the person preparing the reconciliation.
This is a repeat finding in the previous two reports, and the annual financial statement was not published or prepared, and this is a repeat finding. We have Mayor Cale Thompson here today to answer questions. Please come into the table, sir.
Speaker 10
11:36
We were invited to record our treasurer, Kathleen France, but she called and said she was unable to come today.
Speaker 22
11:49
Mayor, will you state your name for the record
Speaker 64
12:04
please. Thank you. Do you have a statement that you wish to make? Push the button. They said I would not be first and here I am first so I'll take it though. First of all, I want to thank you all for being here today. I want to thank you for inviting me. We have made some mistakes and we have let some things ago. That falls on my shoulders. We've been understaffed in our office for the whole time
I've been in office. We literally just kind of came in, took over like it was, and we just have been flowing. We've had a lot of outside the office help, water guys, police department. So a lot of our funding was going there, but we learned very quickly that the office, especially after this, when you guys repeat it up there, it makes it sound a lot worse than it sounded when I was sitting with the auditors of our local office. But anyways, um, we've hired more office help and we have now two people in the office. This is going to get better. It's, it was
just a lack of, um, oversight on my part. And it was, um, a lack of help. We just literally did not have enough office staff to keep up with what we needed to do. And, um, we just, we dropped the ball and i'm sorry and we're working on it um the audit the water audit is almost done we should have it done the end of the month um we're dealing with bell and company i have a they sent an email this morning or yesterday afternoon i can't remember which it was but they said that they are finishing up they have someone overlooking the water audit to make
sure that 22 and 23 are complete on their end and then they're going to submit them and they said 24 can be done probably 30 but they said give us 60 days to be sure that we can because now that they have it in their system it's going to be easier to put the pieces together going forward our city council has accepted the budgets that were behind and so that's been in the works to get taken care of and we have new system in place for all tickets so i know one thing that was a
problem was it took too long to get the auditors to things we now have a scanning system and it's going right in as soon as we get receipts they're going right in they're being tied into quickbooks so that that stuff will be dropped in reports when they ask for it um we we apologize i apologize we really have we dropped the ball on a few things but um small city as we just heard with fargo it's hard to find people that want to help especially people on small budgets or on volunteer services it's it's society we know I'm not telling you guys anything
you don't already know but we are working on things and and I would appreciate a little bit
Speaker 67
14:41
of mercy does anybody have any questions of the mayor senator Johnson yes sir
Senator Mark Johnson
Unverified
14:46
thank you mr. chairman mayor thank you for coming and well candid with us
the gentleman over your right shoulder with the gray hair that's former senator Jack Critcher he's with the Arkansas Municipal League okay and they stand by ready to help y'all okay if you can get your systems
in place then people can keep up this a lot better but I know that he can offer y'all some help so I wanted to introduce him to you and you ask for a little mercy we will not be me at least mr. chairman my understanding is we will not be meeting barring some emergency in july because of uh conferences that will most of us will have to go to so it would be august do you think it's possible maybe to have things done with your with bailing company i will i will make all this meeting yes i will i will
Speaker 71
15:35
i will i will force my hand and
get it done i know they said this summer they're
Speaker 64
15:40
going to be busy with people being off for the hall for the holidays and that kind of stuff but i'm going to push pretty hard um the email that they sent us yesterday was very apologetic because they have dropped the ball and they've got behind on getting this done for us but they said it was a lot of information and with us being a new customer they're having to put a lot of pieces together that once they're in place will help this
Senator Mark Johnson
Unverified
16:00
flow so they would in effect have a template to follow to do the
Speaker 64
16:04
third year yes and our information will kind of just automatically drop into their system so that they will have
things live instead of having to get them post.
Senator Mark Johnson
Unverified
16:13
Okay Mr. Chairman I would move that we postpone this till the 60 days
to the August meeting of let's leave audit if that's proper motion. All right is there
Speaker 432
16:23
a second second discussion on the motion saying none all in favor say aye all opposed motion carries thank you all very much would you request my appearance at the
Speaker 81
16:36
august meeting yes if you if senator johnson
Speaker 84
16:41
deferring the meeting you have to be here okay
Speaker 64
16:47
i'll stay in touch with my local auditors on the on the dates and the things like that and and miss france may be able to come back with me then my recorder she also
Speaker 84
16:56
she's on vacation this week but she also wants to to write this wrong so we're deferring the report is
Speaker 11
17:02
that what you're we're going to further report as well okay yes okay one one one staff note
Speaker 87
17:08
please yeah mayor you said 60 days on your 2024 water audit that's what bell and companies was said yes they i i have
Speaker 85
17:16
an email here i would recommend that you notify them that they're you're getting real close to the date to where none of your funds will be available to you again i'm july 11th would be a real good date to have it in by okay be sure okay i will i will go home and push that and push those dates yeah july 11th we can you know the the law said one year from
Speaker 25
17:38
the from the date so okay that that's a good that's the earliest it could possibly be that you would be in jeopardy of losing that
Speaker 83
17:44
whole year's worth of funds i just want to make sure you you uh understand that okay
july 11th yes sir okay and that's the earliest earliest
Senator Mark Johnson
Unverified
18:07
to be be submitted by then? Yes sir all three of them yes okay. Senator Johnson. Mr. Chairman I made a motion but do I want to ask
Speaker 27
18:15
Mr. Archer if I needed to modify that based on what he just said. So there's two different issues the 60
Speaker 25
18:21
days was the substantial non-compliance under 1459.117 the the
water issue is a completely different issue. 27.7.207 governs that. Two different issues. And that's the one that
Speaker 99
18:32
has the drop dead data. Yeah, that started last year, so we can't change that in this. Okay. So I shouldn't
Speaker 101
18:38
need to change my motion. Okay. Thank you. Thank you, Mr. Chairman. I think we're good. Mayor, thank you. Are you guys done with me? May I leave, or do I need to
Speaker 23
18:50
stay? No, you're free to leave. Yes, sir. Thank you. Mr. Fox. I mean, Okay, continuing with substantial non-compliance, we have
Speaker 11
18:58
the town of Ulm on page 37.
Town of Ulm, December 31st, 2024. Under the mayor, an annual audit or agreed upon procedure report has not been obtained for the water department since 2020, as required of Arkansas code. This is
Speaker 10
19:18
a repeat finding. As I said earlier, staff note they're currently having their escrow, their turn
Speaker 11
19:24
back escrowed due to this issue. Under the recorder treasure, accounting procedures for municipalities are set forth in Arkansas Code 1459-101-119.
The town was in noncompliance with these codes as follows. Bank reconciliations were not performed on a monthly basis. When bank reconciliations were performed, bank accounts were not properly reconciled. Bank reconciliations were not approved by someone other than the preparer. Cash receipts and disbursement journals were not properly posted and reconciled with bank deposits and withdrawals. Prenumbered receipts were not issued for all monies received in the general fund. This is a repeat finding.
I believe we have Mayor Dennis Doppel and Recorder Treasurer Mary Beth Floyd here today. They told me they were coming. oh yeah they are okay if
Speaker 432
20:30
you would turn your microphones on and state your name for the record please mayor dennis dopel recorder marybeth floyd
do you have an open statement that you'd like to make Are there any questions of
Representative Carol Dalby
Unverified
20:57
the mayor of the secretary? Representative Dalby. I really have a question, staff,
for Mr. Archer. I've said on this committee, I think this is my second term to be on this committee, so that doesn't quite go back to 2021, but are we getting the same answers?
Did we get the same answers the last time they got audited that we're going to take care of this and that didn't happen and then are we getting the same answers in 23 and it didn't happen and here we are now getting the same answers and I
Speaker 25
21:27
don't have the the previous year response letter in front of me you see that we included their responses for this current year sure but they did indicate or we
Speaker 29
21:35
wouldn't have filed the report that corrections would be made in general terms another question may i
Representative Carol Dalby
Unverified
21:45
mr yes please proceed so mr archer when folks say they're
going to make the corrections how long do you give them to make those corrections and when do we get a report that they've made those corrections the usually it will or do we have to wait until the next audit to
Speaker 29
22:02
find usually the next audit because we have to go back and follow up and see if they were corrected i mean we don't go out and do follow-up visits we just visit every year so we go back and follow up at that time on each engagement regardless of whether there's findings or not so we just follow up the current the following year that's that's the reason it's my understanding that policy in this
committee was made several years ago that if you have a repeat finding on
Speaker 10
22:24
the same official you get to come visit okay thank you we need a motion or on the 60-day
clock all right if there's no other questions I think we need a motion on
Speaker 432
22:44
the 60 day clock I'll make that motion second motion second any discussion on the motion all in favor
say aye all opposed say no the ayes have it with that
Speaker 10
22:55
objection we'll file the report moving on to agenda item F we have a discussion of non-compliance with 27.7207, which is misuse of street funds.
Speaker 11
23:09
With Chair's permission, I would like to go ahead and present the reports for the town of Jericho
Speaker 26
23:15
and the city of Haynes. Please proceed. On page 7 and 8, we have the town of Jericho.
Speaker 11
23:28
7 and 8. 7 and 8. The town of Jericho 2024, under the mayor and police chief, fines and cost revenue of over $47,000 exceeded 30% of the town's expenditures in the preceding year by over $17,000 in noncompliance with Arkansas code. The revenue was generated from traffic offense citations written by or arrests made by the town's law enforcement personnel.
This is a repeat finding. Continuing on page 8, under the Mayor and Recorder Treasurer, Schedule 1 of this report shows a deficit fund balance of just over $600 in general fund. It was brought to our attention that as of December 31st, 2024, the general fund owed a significant amount to the street fund. As shown in Note 6 on Schedule 3, when this outstanding account was considered, the general fund had a deficit fund balance of just over $58,000. This is a repeat finding
Speaker 10
24:32
in the previous four reports dating back to 2020.
Restricted funds of over $57,000 were not transferred to the street fund from the general fund, as required by Arkansas Code. The town received approval by the legislative joint audit committee on February 9, 2024, to pay $100 and $200, also dating each month, for three years, and pay $300 monthly thereafter. which would total $1,500 in the current year beginning March of 2024.
Speaker 11
25:06
However, the town only paid $1,007, or 67%, of the 2024 amount owed. This is a repeat finding in the previous 16 reports. The cash receipts journal for the general fund was not properly classified as required by code. This is a repeat finding. Staff note, real quick, just to kind of give you a little background here. I had staff go back, because this is a 24 report, and now it's May of 2026.
I had staff go back and update us to the 1st of May to see where they were on their payment plan. And just a quick recap,
Speaker 27
25:46
they were $493 short at the end of 24, which is our reporting period. At the end, they made all their
Speaker 11
25:55
payments for 2025 on time. And then as of May 5th of 2026, they were an additional $700 behind, so that's a total of $1,193. We were contacted on May 28th through the help of the Municipal League, and they had made an additional $1,200 payment at that time.
So as of today, they are current on the 277-207 issue. That does not prevent y'all
Speaker 25
26:18
from taking any action y'all wish to take. because they were in non-compliance at the end of the end of the reporting
Speaker 11
26:28
year 27 70 207 says y'all may act on that but i wanted y'all to have the full picture as far as where they were currently also we have uh police chief roy hill here today to answer questions about his finding
Senator Ben Gilmore
Unverified
26:46
and uh on the Senator Gilmore, do you have a question? Yeah, and as the
chief's coming, just a question for Mr. Archer. Did you say the previous 16 reports or since 2016? 16 since 2001. Uh-huh. Okay. I just wanted to make sure I was hearing that correctly. Thank you, sir. Yes, sir. Representative
Speaker 144
27:12
Dalby. I have a question for Mr. Archer.
Representative Carol Dalby
Unverified
27:17
Yes, please. This is I should know this answer, but I guess I'm not thinking what happened to the seventeen thousand six hundred and ninety two extra dollars Where would they spend that on? Where'd it go? It's it's in their general fund well We're
Speaker 29
27:34
winning their general phone. There's only six hundred fourteen dollars left, but it was used I mean It was used in the normal course of operation
Representative Carol Dalby
Unverified
27:43
So they could have gotten current long before the Municipal League got in touch with them
Speaker 114
27:48
I mean, they had $17,000 extra. Am I reading that correct? No,
Speaker 27
27:55
ma'am. They violated the speed trap law by $17,000. That is a correct statement. And that money
Speaker 29
28:01
was expended on some normal expenditures that we did not have issue with in our normal testing. I can answer it that way. We didn't track that exact dollars is what I'm saying, but we didn't find any exceptions to any of their expenditures throughout the year.
Representative Carol Dalby
Unverified
28:21
Okay, thank you. I have an editorial comment, but I'll just wait.
Thank you. Senator Johnson, do you have a question? Yes, thank you,
Senator Mark Johnson
Unverified
28:36
Mr. Chairman. Chief, thank you for coming. Thank you. Are you familiar with the
so-called speed trap law? Yes, sir, I am. And y'all exceeded the amount by
quite a bit. We had an area that used to be in my district named Damascus.
You ever heard of them? I don't think I've heard of them. Well, Damascus, they didn't, for I don't know how many years, two or three years, they didn't get to write any tickets at all. So they had zero revenue off of speeding or other traffic fines. I don't want you all to get in that because something tells me where you all are located. It might be a pretty significant part of your budget. But, I mean, and I'm sure these people that you say were speeding or whatever their violation, they were. But we did this, we, the General Assembly, I wasn't here then, passed that law for a reason, for actually a lot of reasons.
So you said y'all are now monitoring to
make sure you're in compliance. Could you explain to me how you do that? Do you just tell the officers, okay, we've met our quota for this month, so don't write any more
Speaker 159
29:46
tickets? No, sir. How do you do that? the senator most
Speaker 432
29:50
certainly do apologize for mr. Hill but I want to interrupt you before you start answering that question
if you would just take just a moment and state your name for the record and
Speaker 157
30:01
then proceed chief Roy Hill Jericho Police
Senator Reginald Murdock
Unverified
30:03
Department thank you please proceed so that I'm most certainly you know to the board I do want to apologize you know for that and since that since these incident happened, you know, we have looked at all the angers of the speed trap law and we have raised the speed limit. You know, we know we're at that 10 mile stretch and we have since then raced it up to 13, 14, over before we stopped anybody out there. So, you know, you got to be
going to that stretch hole. So, no one is being stopped under 12, you know, 12 miles over. And And then some of this revenue that we get, you know, from drug activities, failure to appear a fine, driving or suspended, like that. So we're just not all capable except for speeding. And some of those speeds that we get, once we get those speeding, and then we check them out, you got to spend a driving license or you wanted some other fine activity of insurance and stuff like that. So we monitor that, we cut that speed, you know, raise it higher to try not to get into
trouble with that. And once they go over that threshold, then when you stop them, they got, like I said, a sprinting driving license, or they got failure to peer, or they got no insurance, or they got no driving license, or they violated the interlock device. So all of those, they're coming down. Then they got drugs. So in one incident, you might get just the speed, and out of that, you might get a whole bunch of drug charges out of that. judge fine knows those fines uh exceeded like maybe eight to nine hundred to a thousand dollars
and they're having on spending like five hundred dollars so the judge when he make that ruling and we even lowered the speed i think most of the city speak there's like 195 we dropped out with five down to 185 you know try to capture it off all of that so it's kind of hard and one stop you're gonna get you're gonna get that threshold up there gonna go over over the over the uh the margin okay
Senator Mark Johnson
Unverified
32:05
now chief of that forty seven thousand three hundred fifty six dollars in in the the fines and cost revenue that includes shall we say the
non-speeding things that might be a failure to appear in the past or
Senator Reginald Murdock
Unverified
32:19
or that is that is correct that's exactly what I was you know explaining that so you will have the speed and I can't remember the total numbers
Speaker 166
32:28
for the speed Then you may have the the higher fine is going to exceed those speeds automatically no matter what
Senator Mark Johnson
Unverified
32:36
So would you and again? I'm not I'm not pinning you down to say it's this or that however There's possible would you say that there's a possibility that if you if you strictly limited it to the the stated
maximum fine for Speeding at so much over the limit that that's it that number might come back
under the 30 percent threshold that's outlined and it is very it is very possible
Senator Reginald Murdock
Unverified
33:00
so I think we had talks on the latest rate of office you know which we just find out that the the failure to feet appear does not count to that so you got you got those margins you know in there as well too so we just looking at one here we had like over you know thirty seven hundred dollars in fine twenty seven twenty six hundred dollars
and court costs, so that can easily extend our fine amount. So just not so much of the speeding like that. Yes, sir. And now one final
Senator Mark Johnson
Unverified
33:32
question, Chief. Who is your district judge? Tyler Jen. And where does he live? He lives in Ameri. Okay. The reason I'm wondering is if the judge, and I'm not saying he should or shouldn't, but, say, throws the book at them for a failure to appear.
While I don't take that lightly, it's not the same as what's covered under the speed trap law. I'm just, Mr. Archer, do we have
a, is that something that your staff looks at? Is it, I mean, I get that it all goes into one big deal of revenues, but is that something that could be broken out so we could, I mean, I'm not saying, what I'm saying is 47356 might not be an accurate picture for the things that we're discussing here.
Speaker 25
34:26
It's, correct me if I'm wrong, Charlie, two sessions ago, they went back, y'all went back and amended that law to eliminate those type of things. It's not the
Speaker 27
34:35
failure to appear, and those are not included in that, right, Charlie? They're not included in that figure. Well, that answers my question. Well, originally, the original law, they were, but the same question was brought up, apparently, rightfully
Speaker 29
34:48
so, and y'all addressed that, and it is strictly, and it's not outside agents either. The
Speaker 27
34:54
law was amended to remove those, so if the state police came to fish,
somebody else is issuing tickets in the jurisdiction, that doesn't count as well. Strictly by the officers of the entity, and it's just those, I don't know what the word, the initiated fines. It's not those that bill for failure to appear in those sort of things. those that could go on forever yes
Senator Mark Johnson
Unverified
35:11
with fees and everything okay well they're from previous years they're not in the the
Speaker 83
35:15
time period of all thank you mr rosh thank you chief
Speaker 174
35:18
would you help us clarify that thank you all right
Speaker 432
35:20
thank you senator johnson i believe uh senator hammer did you still have a question you wanted to ask chief do
Senator Kim Hammer
Unverified
35:29
you know what uh what your total town budget is i know
that's maybe not in your area but do you because 30 of the town's expenditures do you know what the total expenditures is of your city because
you're only 98 in population right no so i don't i don't recall it right off yeah what it is okay and i guess what i'm thinking is we don't do you know do
you all know what it is 102 000. 102 000 total expenditures for general fund total expenditures for general
Speaker 29
35:57
fund were just over a hundred thousand dollars so you and i'm just trying to think a little
Senator Kim Hammer
Unverified
36:06
bit outside the box here you're against the wall already correct because if your total expenditure is only 102 what would be that what would be the math as far as where they would hit their ceiling 30 right but so anything over 30,000 so that is exactly what we did come up with somewhere out 30,000 I get met
Senator Reginald Murdock
Unverified
36:27
with the district judge and we all sat down we was trying to figure these numbers there area. So, you know, what we did, we even were stopped at some weeks or even trying to do
anything to not, you know, reach that threshold there. Like I said, it's just
Senator Steve Crowell
Unverified
36:40
almost impossible and very hard to do that. I'm not going to be in
Senator Kim Hammer
Unverified
36:45
the legislature next time around, but it seems like you're, you've been put in a box that if early on you hit your quota, we'll say, you know, in the year, anything happens after that, your hands are tied as far as being able to I mean somebody could blow through your town a hundred miles an hour and what are you gonna do okay you really can't do anything just like we
Senator Reginald Murdock
Unverified
37:06
had another shooting aggravated assault just those things we go out and get
those because you know that's looking at a real high fine there you know and if he find those up two or three four thousand dollars on that fine that just gonna put us in hope so we got to sit down until we look at that until we can get to
Senator Kim Hammer
Unverified
37:24
a stage we can move forward and I'm certainly not advocating for speed traps because uh at all i don't want to be misinterpreted in that fashion but it seems like the scenario is if your whole city budget is a hundred thousand yes sir you could hit
that pretty quick very quick i mean even if you hit the higher one very quick all right thanks
Speaker 182
37:42
all right representative dalby did you have a question
Speaker 432
37:46
no senator crow all right senator crow you're recognized how many police officers do you have on the force
Senator Steve Crowell
Unverified
37:53
we just have myself and one of you guys are busy uh just just for curiosity's sake is are you getting most of them on 77 yes sir okay i just wanted to because that it that does looking at the map yes that is uh rather than going on the interstate they can speed up that way yeah that's no pun intended right that's where we got all the drugs and everything
else on there okay thank you sir yes all right and i want to
Speaker 432
38:14
come to uh senator clark right quick i
Senator Alan Clark
Unverified
38:19
believe he had a question thank you mr chair chief i'm not nearly as friendly about speed traps as everyone else that's spoken. Where
Speaker 157
38:29
is Jericho located? It's right next in the area on the border
Senator Alan Clark
Unverified
38:35
of Tennessee, West Memphis, Marion. I want to be sure when I'm driving. And what main highway comes through?
77. Okay, somehow I've avoided Jericho up to now. Or I would probably already know And what is the speed limit in Jericho? That's 45 45 and the speed limit on 77 outside of Jericho That's 55. It's 55. So it's just a 10 mile an hour drop. That's correct. And how long is the Speed limit 45 miles an hour. What how many miles? I don't know
Speaker 159
39:13
exactly, but I know one thing that we did
We have to stay to put up like three signs
Senator Reginald Murdock
Unverified
39:19
before you enter Jericho telling you that 45 is up that way Then when you get close to the town, there's another 45 then when you get on to the city limit That's another 45 so that three signs there. They have to pass before we get all into that So we have looked at everything try to change signs try to change it the top speed that we are getting right now It's 20 the 20 miles of the speed I'm between 65 to 70 give you an example Just on Monday, we had another chase of a young man come through there, and his speed was up to around 70.
So he ended up transporting him to jail because he fled from the police. So we had to have the aid of the Marion Police Department in the county to assist. So that is a
Speaker 166
40:03
constant thing. The speed is just not at 50, 60, 70. It's going on up there just higher,
Senator Alan Clark
Unverified
40:09
higher. This is your first time to be cited for being over the limit? No, sir. We've
Speaker 157
40:18
been cited before. How many times? I don't remember. I know this would be my first time coming back.
I think I didn't come last year and the year before that, if I
Senator Alan Clark
Unverified
40:30
can remember correctly. So this is a continual thing, which is why we
have the law? That's correct. What, Mr. Chair? Yes. Does anyone here know if there's a penalty, or do we just have them come in and
Speaker 29
40:44
talk to them? I answer. Yes. This has been referred to the prosecuting attorney, and they make that determination whether or not it's actually a— all this is that we're reporting that they failed the test. Audit does not certify them as a speed trap.
That's the prosecuting attorney's job. And then they will take the steps, and it ranges anywhere from, I have seen where they forbid them from issuing tickets before, Disbanded the police department to make them pay all the additional fines over to a school district in their area. I've seen it. Or to do nothing. I've seen all of those. But it's the prosecuted attorney's role is to divide the penalty.
Speaker 25
41:18
And we can refer it to the prosecutor? It's already been referred, yes, sir. It's automatic. It's been referred. Can
Senator Alan Clark
Unverified
41:23
we get a report back? You get
Speaker 25
41:26
one at the Friday meeting, and usually once a year we do them all together.
Michelle does her report in the Friday meeting for a year long. So we'll get
Senator Alan Clark
Unverified
41:35
a report back from the prosecuting attorney. Yes, sir. What they've decided. Yes, sir. And this has happened multiple times. This is a
Speaker 29
41:44
one-time repeat. So it happened in 23, but based on the wording, the finding, it did not happen in 22. But I am familiar that it has happened prior to that. I can't give you the exact dates,
Speaker 208
41:54
but I know 22, they were good. 23, they were not. And 24, again, they were not. I'll be
Senator Alan Clark
Unverified
42:00
very interested in seeing that report from the prosecuting attorney.
Thank you, Chief. Thank you, Mr. Chair. Senator Hamber,
Senator Kim Hammer
Unverified
42:09
did you have another question? I need a little clarification, Mr. Archer, if you would, because I want to make sure I'm hearing both sides right. What I heard you say was that the fines, you stop somebody, and then there's add-ons, such as
Speaker 27
42:31
saying. Do those add-ons go against that? Failure to appear. After the original violation, that judgment, any additional fines on that particular case does not.
Speaker 25
42:41
So if you fail to appear, fail to pay, all that stuff, they do not anymore. Now, Chief, speaking of other
Speaker 29
42:49
violations, as long as it's a traffic, it has to fall into a traffic violation before it's
Speaker 27
42:56
considered into this. speeding it's just speeding all these are just beating all the
Senator Kim Hammer
Unverified
43:01
so the so this these numbers in our report are specifically just speeding yes
Senator Reginald Murdock
Unverified
43:08
was that your no sir no no those uh you we got speeding
driving on suspended no insurance uh interlock device it's a number of those things we you know we have it's just not that you're looking at you know driving suspended uh driving left to center expired driving license expired tag fair obtained reached lpn fictitious tag flea and no driving license no trailer tag for me an unauthorized person to drive running stop sign uh commercial speed 20 miles of the speed theft of property so so we got those charges those amounts are included
Senator Kim Hammer
Unverified
43:46
in that i don't i don't hear y'all agreeing am i misunderstanding or y'all
Speaker 29
43:51
not they're included in the original finding comp finding cost amount put in general fund and then once you fail that test taking that whole amount we then go back and expand our testing and break out all the things that the when they amended the law we break those out to make sure
Speaker 25
44:05
that's not what causes it no okay all right
Speaker 432
44:12
so at the end of the day it's just the speeding tickets that that are being
trigger the tipping point here. So
Senator Reginald Murdock
Unverified
44:21
I guess I need some clarification on that because of my understanding that all of this is being counted. All of that is being counted because we sat down, we talked about we pull out all of these here. If I pull out everything else except for the speaking, then I should be okay. That's something we
Speaker 25
44:46
prosecutor's going to make the call on this If the prosecutor needs us to do additional breakouts, there are occasions when we report to the prosecutor that says the initial test, they fail.
Speaker 29
44:59
You know the situation at your area. Do you want us to expand the test and break everything out? Sometimes they instruct us to do so. Sometimes they do not. I can't answer whether or not on Jericho what the answer was at that time. But the law is, I can tell you what the law is, the law is none of those things are in the figure when you go to the comparison after
Speaker 26
45:25
the law was amended. Wow. Are there any other questions of TPO?
Speaker 10
45:31
We need to deal with the, can I? Yes. I failed to mention when I got sidetracked when I presented this report.
Speaker 25
45:40
Mayor Ida Sumner and Recorder Treasurer Emily Dupree were invited here today. They both called. I believe the mayor has had suffered some health issues. And Recorder Treasurer Dupree is the, they have an alternative school schedule and
Speaker 27
45:55
they're doing testing this week. And she's an educator. We need to decide whether we're going to consider them
Speaker 11
46:03
current on their street payback because they're current now.
Or does the committee wish to take action on the fact that they were $493 behind at the
Speaker 97
46:13
moment we audited for the first year? What is the
Speaker 25
46:24
will of the committee? Just a point of clarification. If the committee has the option to escrow all their street revenue here, that's the question at hand, until the entire $57,000 is paid back.
Speaker 29
46:37
And defining above that states that they got $614 in general fund. Just so y'all have the full picture. Senator Gilmore
Senator Ben Gilmore
Unverified
47:10
so I say we don't hold it so what would the proper motion be and
Speaker 14
47:16
that's it don't hold not not hold an escrow just file the report just file report I make a motion second any
Speaker 36
47:22
discussion on the motion representative Dobby I would ask maybe staff we hold I
Representative Carol Dalby
Unverified
47:29
mean we don't hold it we go ahead and just file a report, let them rock along. So when do we get a report that they've paid the rest of it? We have to wait until next year? Well, we've already brought it up to date.
It's up to date. It's up to date. $25,000.
Speaker 29
47:54
Well, we set them up on a payment plan that's going to take about nine years on the approved payment plan. I mean, I can't do it in my head, but $57,000 divide about $3,600 because $3,000 a month for a while. So it's going to be 9 to 10 years is what was the approved plan back in February of 24. So all of 25, when we do the 25 audit, they're going to be fine because they made all those payments. And then
Speaker 25
48:18
26 through May, we verified through last week that they're fine there as well.
So we know that far they should be fine. So it'll be two reports before we have another issue with them.
Speaker 27
48:26
any other discussion on the motion there's a motion to file all in favor say aye aye any
Speaker 432
48:40
opposed the no's have it senator hammer just educate me on something if you would
Senator Kim Hammer
Unverified
48:55
Mr. Archer tell me how much they're behind Well, they
Speaker 27
49:00
owe over $57,000. Currently, at the end of the audit report, they were $493 behind, but they've since caught up. As of last week, they're caught up in current, as of right now. On the payment plan, yes. Now, they still owe $55,000-ish. But they're current on their payments, right? Yes,
Speaker 228
49:20
they're current as of this week. They are current.
Representative Carol Dalby
Unverified
49:28
I have a question when's their next payment
Speaker 27
49:37
do mr. Archer June 1st or month of June so they made all the other payments through May of 2026
Speaker 234
49:58
well we just voted on a motion then I move then I moved that we we're gonna meet in August
Representative Carol Dalby
Unverified
50:08
we'll meet in October is that correct September I'm sorry I'm skipping August September October and December so I would move that we bring them back in September and check on their payment plan you want
Speaker 83
50:23
them to come defer it and let them come? Yes. Okay. Second. All right. Senator Gilmore? Discussion on that
Senator Ben Gilmore
Unverified
50:32
motion. So I'm just making sure I understand. So then it'll be held in escrow?
Speaker 29
50:37
Not if you defer the report. Unless you also choose. It'll be nothing will happen until then. Okay. So we're
Senator Ben Gilmore
Unverified
50:43
just deferring the report. I guess to make sure I understand. You're just deferring. Okay. Yes,
Speaker 238
50:47
sir. That's fine. We'll see if they've made those payments like they're
Speaker 239
50:52
supposed to. All right. Senator Johnson. Mr. Chairman, I have a
Senator Mark Johnson
Unverified
50:58
question for Mr. Archer. So what we're, and I appreciate Representative Dalby's motion, and I'm going to vote for it, but I assume what we're looking at is
that the June payment would be made before the end of the month, July and August. So when this magic date of September, we want to know if they are, if they're still current. If they're still current. That's okay. I just want to make
Speaker 432
51:23
sure that's clarified. Thank you. Did we get a second on Senator Crowell's second? Senator Gilmore. Thank you, Mr. Chair. To Representative
Senator Ben Gilmore
Unverified
51:30
Dalby, what happens on September? We'll just make a determination at that point. Okay. So you said
Speaker 14
51:41
September or August? We're going to defer it to.
Representative Carol Dalby
Unverified
51:44
September. And if I may address Senator Gilmore directly mr.
chair I said that again please is it okay if I address him directly we should typically address each other directly my point being senator that they need to understand that we take these payments seriously let's see how serious they are and let's hope that this spurs them to keep on or we'll be seeing them again and again until we get it paid because they did
have 17 hours and extra dollars that
they could have put over just my point thank you mr. chair
Speaker 432
52:19
yes ma'am representative Rye do you have a question this 58 322
Representative Johnny Rye
Unverified
52:27
that the general fund is running a deficit on did they not before this happened did they not borrow money from the road fund mr.
Speaker 230
52:36
archer i'll defer to mr archer yes that's what this is that's
Speaker 87
52:44
they borrowed 57 000 from the street fund and we put them on y'all put them on a payment plan and they're not complying with the payment plans which this discussion has been thank you joe
Speaker 432
52:56
thank you there you go thank y'all any other
Speaker 225
53:01
discussion all in favor say aye aye all opposed say no. The ayes have it. Motion
Speaker 29
53:06
carries. Can I have a staff note, please? Yes. One staff note, Candace just informed me that I thought I was remembering correctly. When we contacted the prosecuting attorney on the speed trap, whether or not they wanted us to expand the test,
Speaker 25
53:18
they asked us not to expand the test for this. So, please, Chief, you are probably correct. All those figures are
Senator Mark Johnson
Unverified
53:33
probably in that number. Thank you, sir. Yes, sir. Thank you, Chief. yeah yes uh senator johnson thank you mr chairman mr archer is that a
case by case by each prosecutor yes sir so they have the discretion we might have again i'm big on treating all communities
Speaker 23
53:47
the same but that is up to the prosecutor yes sir the reason we usually
Speaker 27
53:51
ask them if it's a repeat finding and they did not choose to act in the previous year we want to make sure they want us to utilize the state resources by because that's a pretty extensive tests to go through. We have to
Speaker 25
54:03
go through every ticket. Yes, sir. And separate them all out. And if we give them the number, and if they say that's comparable with the last year and we've got the same situation, as Senator Hammer pointed out, there may be a situation where it's warranted. That's up to the prosecutor, not us. Okay. So there's no need just to do tests for no reason if they're not going to act on that number. Now, if that number would have been
$200,000, they'd have probably had us do that because it'd have been a lot more.
Senator Mark Johnson
Unverified
54:26
It's a case by case by each prosecutor that is correct okay thank you sir thank you
Speaker 10
54:33
mr chairman thank you senator johnson okay back to agenda item f we have the city of haynes on page 34. again we're going
Speaker 11
54:49
to go ahead and present this report at this time
Town of Haines, December 31st, 2024, under the mayor and recorder treasurer. Restricted funds of over $16,000 noted in previous years were not transferred from the general fund to the street fund, noncompliance with Arkansas Code. The Joint Lesley Audit Committee on February 9th, 2024, approved the town to repay $100 per month. However, only $178 was paid in 2024 to reduce the balance owed to the street fund.
Speaker 10
55:25
This is a similar finding that was noted in the
Speaker 11
55:31
previous eight reports since 2013. Although Schedule 1 of this report shows a balance of over $1,900, it was brought to our attention that as of December 31st, 2024, the general fund owed a significant amount for balances owed to the street fund and to the IRS. As shown in Note 4 on Schedule 3, when these outstanding amounts were considered, the general fund had a deficit fund balance of over $38,000. This is a repeat finding for the previous six reports dated back to 2018.
We have Mayor Willie Coleman and Recorder Treasurer Charlotte McFadden here today to answer questions. Staff note
Speaker 21
56:15
here, just as we did on Jericho, I requested our staff go
Speaker 11
56:20
back and bring them up to current so y'all would have the full picture. For 2024, the town was supposed to pay $1,000. They only paid $178.
Speaker 27
56:32
For 2025, they were supposed to pay $1,200. We had no documentation that any payments were made. And through May 1st of 2026,
Speaker 11
56:43
there was an additional $400 due. They only paid $187. So they are, of the total of $2,600 that they should have made, they only made $365 for a deficit of $2,235. If you would, turn your
microphones on and state your name for the record, please.
Speaker 270
57:07
Mayor Willie Coleman. Recorder Charlotte McFadden. All right. Mayor, do you
Speaker 269
57:14
have an opening statement? Yes. I took over after Mayor O.C. Thomas, he had got sick, and I took over, I think, in 25 after him. And a lot of the ones before, I should have went over and looked, but I dropped the ball, and really didn't pay attention to all the things that was done that should have been paid but wasn't paid.
When did you take over? in 25. Okay, so if you took over in 25, why were payments delayed and then even in the 26 year, you're not making your payments? Can I
Speaker 274
58:03
speak? Yes ma'am, go ahead. Payments were not made because they told us we had to pay 10%, but we lost a
Speaker 276
58:09
lot of our revenue and we were not able to make other payments for our bills and our salaries and everything. So in order to
make to pay our bills and catch up on our salaries we took that money and we just paid bills and salaries. This is a bill. Yeah it is a bill and unfortunately we just didn't have the money to pay it. Going forward we do have since they made arrangements for us to do $100 a month we have been paying $100 a month. We We started, when they told us in late February, 1st of March, we started making sure we made those payments. I have also made the payments for June already.
Speaker 278
58:47
And going forward, we should have those payments made.
Speaker 279
58:52
Again, we are sorry. All right. Are there any questions?
Senator Kim Hammer
Unverified
58:56
Senator Hammer? Tell us about your workings with the IRS. You still owe the IRS? Is that correct?
Speaker 276
59:03
We still owe the IRS, and I've been trying to contact the IRS, and every time I get them on the phone, and they say, okay, you've got a couple of minutes to hold, they hang up the phone. During the day I work, I can't stay on the phone with the IRS. I have tried to pass this on to other audiments and everything,
and so hopefully we've got someone that's going to pick that up and get on the phone with the IRS and
Senator Kim Hammer
Unverified
59:27
try to get that taken care of. And I may be
Speaker 283
59:31
missing in here, but how much do you owe the IRS? I really couldn't tell you.
Senator Kim Hammer
Unverified
59:41
I can't remember. I think it's like $32,000. $1,000? Yes. What's your overall revenue into the city's bank account? General fund is $38,000. $38,000? Mm-hmm.
How do you see yourself digging out of the hole that y'all
Senator Kim Hammer
Unverified
1:00:01
We're going to try to do our best. Okay. Are you still, and is your general fund in a deficit right
Speaker 276
1:00:12
now today? No. What's your general fund balance today? $275, I mean $2,000, about $2,000, right at
Speaker 287
1:00:18
$3,000. Okay, so each month, how much are you falling behind each month?
Speaker 276
1:00:23
We're not falling behind each month now.
Okay. We never really fell behind. We had maybe $200, $300 in there, but we never fell behind. But if I made the payment, that 10% that they were asking for, we would not be able to make that 10%. Now that they have it at $100 a month, we shouldn't have a problem. And we should be able to make our payments and let something go up.
Senator Kim Hammer
Unverified
1:00:51
Okay. And as far as the income into the city, you said you didn't have, you lost income.
Right. what you just testified to a while ago, what did you lose or how did
you lose it? You had a business close or property or
Speaker 276
1:01:06
what? No, we had a death. Our police chief died and the police account that we had, the police department, that shut down. It shut
Speaker 285
1:01:15
down? Yes. Okay, but how did that throw you? Oh, okay,
Senator Kim Hammer
Unverified
1:01:18
so revenue you would have had coming in made from speeding tickets or something like that. You've lost, right? Right. Okay, so you don't have a police department now? And does the county cover you all now?
Speaker 276
1:01:31
Sometimes you see them come through. If we need them, then call them. They will
Senator Kim Hammer
Unverified
1:01:38
come down and help us. But we don't have our own police department anymore. Okay.
Speaker 11
1:01:44
And how much are they behind right now in the payment plan? What are they doing? We have records that they've only made $178 in the
Speaker 29
1:01:52
year 2024, no payments in 2025, and only $178 in 2026. So we haven't actually, and both of those payments were a property tax relief payment
that was deposited in the street fund instead of general fund. We haven't seen any record
Speaker 10
1:02:06
of any $100 payments as of the 1st of May. So how much would they have to pay today to be caught up? $2,235. Real quick, Mr. Chair. So you think
Senator Kim Hammer
Unverified
1:02:20
you can make the $100 a month now, even without the police department? Yes. Yes, we can. How did you make up the difference that you think you can make the payment now
if you don't have the police department, but that was the reason for why you fell behind? Yes. No, I'm asking how do you think that you're going to be able to make the payment now because you don't
Speaker 276
1:02:46
have a police department, right? No, we don't, but we're also caught up on our other bills and our salaries. So going forward, unless something changed,
Senator Kim Hammer
Unverified
1:02:54
we shouldn't have a problem making that $100. Procedural question, if I could. Yes. If we wanted to do, just educate me. If we wanted to give them a reset, they're $2,035 behind.
If we wanted to give them a reset and say, okay, we're going to start clean, you're going to
start now, procedurally, can we do that or not? We'd
Speaker 27
1:03:16
have to check with legal on that, but I don't,
Speaker 29
1:03:20
it, the, my recollection is that once the prepayment's set, if y'all have a choice to contact the treasurer,
Speaker 25
1:03:26
that's a choice, it's not mandated, if they fall behind. If you choose not to contact the treasurer, nothing happens. But I don't, I don't know of any, to my knowledge, of anything that allows you to do a different one or, I don't know.
Senator Kim Hammer
Unverified
1:03:40
I'm being told Senator Gilmore might have a motion.
Speaker 35
1:03:44
I'm going to yield him. Well, before I go to Senator Gilmore, Senator Clark had a question. Then I'm coming
Senator Alan Clark
Unverified
1:03:52
to Senator Gilmore. First, Mr. I'd like to ask a foundational question from Mr. Archer. How long have they had the $100
Speaker 10
1:03:59
a month payment? It would have started in March of 2024.
Senator Alan Clark
Unverified
1:04:03
Okay, so it's not just recently. It was March of 2024.
Speaker 302
1:04:07
The payment plan was approved February 9, 2024.
Senator Alan Clark
Unverified
1:04:10
And you don't show, we don't show that those payments
have been made? - No sir. -
Ever? - Correct. - Okay. So we've got a discrepancy that we're being told that this goes back to 2024, the $100 a month, and you're not aware of it until recently? - Until March, in February
Speaker 276
1:04:32
1st of March this year, because we were told it was 10% that we had to pay. We also
Speaker 274
1:04:38
signed a resolution saying that we were going to pay that 10%, but fell short. Okay, so
Senator Alan Clark
Unverified
1:04:43
whatever you thought you were supposed to pay, we haven't paid anything,
and you think you've been paying it? Since
Senator Alan Clark
Unverified
1:04:59
year. We have been paying it since we found out. Okay. Okay, I appreciate that. That's not what our records show, and I appreciate y'all being here. What's the population of Haynes? 120. 120. I suspect it. Because I have communities in my district that are several hundred that are not towns,
and I have cities that are 117 that are towns. Is it possible? I'm sure you're doing the best that you can. Is it possible that the numbers just don't add up for Haynes to be a town? No, I don't think that's true. It's just we
Speaker 307
1:05:38
fell on bad luck. Like I said, we lost revenue But going forward, you know,
Speaker 276
1:05:43
we have other people in place now that we can do stuff to raise money So I think we're gonna do okay
Senator Alan Clark
Unverified
1:05:52
Okay, well, we don't show that so far. What's the How much in arrears at $100 a month? How much
are we paying back besides? They're
Speaker 10
1:06:03
currently as of 1st of May of 2026, they're $2,235 behind on the payment plan that was approved and sent to them on February 12, 2024. Okay, so it'll
Senator Alan Clark
Unverified
1:06:14
take almost two years starting now, besides the
other debts that they have with IRS, which from what I'm hearing is quite a bit larger.
Speaker 311
1:06:26
Okay. All right. Thank you for answering my questions. Thank you, Mr. Chair. Senator Gilmore. I don't know
Speaker 312
1:06:34
if Senator Wallace had a question before you come to me. Okay. I
Senator Dave Wallace
Unverified
1:06:38
guess, all right, go ahead, Senator Wallace. Thank you, Mr. Chair. How many city employees do you have and what
Speaker 290
1:06:48
is your monthly payroll? We have five. It's
Senator Dave Wallace
Unverified
1:06:55
about $1,400 a month, payroll. Total $1,400 a month for five, so they're part-time?
Speaker 432
1:06:59
Yes. Okay, thank you. Senator Gilmore, before I come to you, I'm going to let Representative Cooper ask a question, then
Representative Cameron Cooper
Unverified
1:07:11
we'll come to you. Senator Wallace asked part of my question, but I'll just follow up on that. So, how many council members do you have? We have five council members, Mayor and myself. And I assume that all the elected officials are also paid a salary, is that correct? So, you're not including yourselves in that number of five employees?
Speaker 320
1:07:29
I'm sorry. I said five. I meant seven. I'm sorry. It's five aldermans and the mayor and myself. So you're
Representative Cameron Cooper
Unverified
1:07:37
the city employees. You don't have any further city employees? No. Nobody working in streets or anything like that? We have a guy that
Speaker 276
1:07:44
cut our streets, you know, make sure the lawn is cut and all that, but that's only other employees we have. Okay,
Representative Cameron Cooper
Unverified
1:07:52
so the numbers you gave Senator Wallace are for the elected officials? Correct. Okay, thank you. All
Senator Ben Gilmore
Unverified
1:08:00
right. Senator Gilmore. Thank you, Mr. Chair, and I appreciate it. I think we all understand it's difficult at times, especially in some of these more rural areas. I know I represent a large swath of rural southeast Arkansas. And so I have a lot of communities similar to this who struggle, especially with low population, low revenue, things of that nature. I do think it's time that we get serious and take a look at the sustainability of these communities.
the sake of their citizens frankly and for the good of all of Arkansas but I think that should be decided at a later date so what I'd like to do with my motion is make a similar motion that was made before that we defer this to September ask them to come back see where they're at and then we make the determination at that point and maybe we have a few other communities to look at as well but we make the determination at that point to discuss charters for a lot of these communities that are struggling like this because again I I think there's certain expectations by the citizens that live in those communities for services and other things that, you know, their taxes are paying for.
And at the same time, do they have the ability to be viable and to be sustainable? And so, again, I'm not making that determination today. I appreciate what I'm hearing from the end of the table that you're trying, that you were in a bad spot. You're trying to work through it. I appreciate all of that. But at the end of the day, there are communities all over this state that are in the same position that you're in, where you have, you know, population says 122 on the paper, you say 120. We had one that was 57 a few minutes ago, so on and so forth.
When it comes to, is that good governance for the state of Arkansas? I don't know. I don't know that I have the answer for that. My gut would say probably not. So I think we should have and take a hard look at that. So anyway, with that, my motion would be that we defer this until September and ask them to come back and we can take it up
Speaker 36
1:09:56
at that point. Second. Second. Any discussion on the motion? All in favor say aye. Aye. Any opposed? Motion passes.
Senator Mark Johnson
Unverified
1:10:06
Thank you. Thank you. Yes, Senator Johnson.
I'll keep this as short as I possibly can. I agree with everything Senator Gilmore just said. I think that this may be something we want to start looking at before January of 2017. But I think we have so many like this, as he said. And sometimes it's incompetence.
Sometimes it's just hard times. We've had one case where, you know, our police chief died. I mean, when you've got, you know, around 100 or even less than 100 employees, you know, everyone's critical. I think Senator Gilmore didn't want me to say anything about school districts. But, you know,
we went through a time when someone, I wasn't here then, I was here but I
wasn't in the legislature, made a determination that if your school district was less than 350 people, you didn't need to be a school district.
I was opposed to that. I still think it was a bad idea and we backtracked on that because some school districts operate just fine at that number and some can't. You could say the same thing about cities. On the other hand, there is at some point we have to recognize that because there's sort of a minimum operating amount for someone to be a city, that we do have towns that are just too small. And I think this is something that needs to be addressed in legislation.
I don't like the idea of us more or less picking on one and maybe starting things to, unless they're just belligerent. And we've had a few of those. I won't name names, but those have been on this committee a little while and know what we're talking about. Of some of these communities that kind of thumb their nose at our auditors and our laws. But I think we need to be consistent and fair with however we deal with this. But I think rather than keep, you've heard this saying, keep doing the same thing over and over again and expecting a different result.
And sadly, I think in this committee we see that too much. So I only want to say everyone, I don't have the solution, just like Senator Gilmore said. He didn't have a solution. But I think collectively
135 of us next year need to start looking at at least a partial solution. That was really
all I had, Mr. Chairman. Kind of alluding back to your original remarks, I think Senator Gilmore reinforced that with his
Speaker 432
1:12:35
comments. And I think there's an appetite to quit kicking the can down the road. Yes, sir. And you can only be lenient so long and forgiving so long.
At some point, you just have to stop and make the hard decisions. I think we have two cities that have just been given a little extended grace to go to September. And then that will let the legislature start discussing about how we need to move forward if they don't rise to the occasion. Thank you, Mr. Chairman, for that comment.
Thank you, Senator Johnson. We're going to stop just a minute. We have nine college students that are with us today.
Speaker 432
1:13:16
Would y'all stand up, please? Thank you. Y'all just remain standing just for a minute. These are accounting majors. I think they're all pretty well juniors and seniors, and this summer they're going to be doing an internship with the audit and see if this might be a fit for them and a fit for the audit division. I just know that it takes a lot to be a county major, a lot of hard work. So we want to commend you for doing that and coming here today.
But, you know, this represents what's good in our state, young men and women who are working and building a future. And we have the U of A represented today, Arkansas State, Harding, John Brown University, and University of Central Arkansas here today. So they've just been going through their orientation. I think they've been going around for the other committee meetings, setting in on them, getting an appetite to see what they're going to be doing this summer. So I just wanted to stop and recognize them.
So good luck on your internship this
Speaker 21
1:14:26
summer. Thank you. You may be seated. Thank you, Mr. Chair. Moving on to item G, review of reports on page one. Well, excuse me, we have 24 reports deferred from the previous meeting. On pages 1 through
Speaker 11
1:14:40
3, we have the Pulaski County, excuse me, we have a special report on six regional solid waste management districts, a review of selected policies, procedures, and transactions from July 1 of 22 through December 31st of 23.
This was deferred so the Pulaski County Regional Solid Waste District Manager, District Executive Director, Craig Douglas, could be here today. staff member charlie camp is going to present this report thank you
Speaker 329
1:15:18
joe charlie camp staff six findings were issued for the pulaski county district
Speaker 330
1:15:24
finding one involved payroll items such as salary increase contract for services and employee bonuses not properly approved by the board. This finding was referred to the sixth judicial district prosecuting attorney and the attorney general. The remaining findings involved credit card disbursements without proper supporting documentation at the time of payment was made. Contracts
Speaker 331
1:15:47
not properly approved by the board. Issues related to car allowances, personal use of Pulaski County District vehicles, and cell phones. Competitive bids not being
listed for the cost of multiple services and lack of an electronic funds payment system with written policies and procedures for internal accounting controls and documentation for audit and accounting purposes. Other matters
Speaker 330
1:16:12
included the Pulaski County District expending three hundred twelve thousand nine hundred seventy seven dollars in public monies for advertising which appears excessive in comparison with amounts expensed by other districts in this report. As noted in a prior report the Pulaski County District had a contract with a vendor that required the vendor to repair and maintain district
owned equipment located at the vendor's facility and used by the vendor. However, the district paid for maintenance of the equipment from the district's maintenance and repair capital fund. Subsequent to the issuance of the prior report, the district closed this fund and sold 46 trailers to the vendor for
Speaker 331
1:16:49
substantially less on the purchase price. Finally, other items were sold to a second vendor, but detailed descriptions and purchase prices were not available for the items in this sale. Mr. Chair, this concludes my report.
Does anybody, I was just going to ask, does anybody have any questions? I see Senator Wallace. you're recognized thank
Senator Dave Wallace
Unverified
1:17:27
you mr. chair is there a reason why mr. Craig Douglas is not here today yes mr. Douglas would
you come up with would you state your name for the record
sir Craig Douglas director of the regional recycling district
Speaker 337
1:17:48
in Pulaski County do you have a statement mr. Douglas no sir we issued a
Speaker 339
1:17:56
letter of response be happy to answer any
questions all right Senator Wallace do you have a question what what has
Speaker 343
1:18:12
happened with this all of the findings yes well I can take them one by one please be happy to do that senator thank you for the question in terms of the payroll items where the finding
Speaker 344
1:18:24
stated that they were not properly approved by the board.
In the district rules and bylaws, the board previous to my accepting this position authorized the executive director to make the decision on payrolls including contract services and bonuses based on the line item salaries and benefits budget approved by the board every In addition to that, all of the increases or any of the expenditures in that light item
are shared with the board every quarter. The board has authorized the director to issue any payments less than $1,000, and any payments over $1,000 are approved by two officers of the board. However, at every quarterly board meeting, every expenditure is listed and approved by the board
Speaker 343
1:19:25
as part of the minutes. As far as the contracts, as the findings stated, not properly approved by the board.
Any RFPs, extensions of contracts and
Speaker 344
1:19:36
amendments are shared with the board and the director is authorized to execute those contracts. Once the contracts are executed, then the board comes back and reviews those
Speaker 343
1:19:49
contracts at the next quarterly meeting. In terms of, I believe, I don't know, Charlie, if you mentioned the electronic funds transfer, we have set that up based on recommendation. In addition, the car allowance
and the personal use of vehicles is listed in an annual vehicle report and expenditures for personal use are reported on W-2s for tax purposes with the IRS. The audit recommended that the district contract the IRS, and I'm reading and quoting here, for guidance regarding documentation of
Speaker 344
1:20:29
car allowances, we have done that. And the IRS has advised our CFO that the board may require, emphasis on may, require
daily mileage logs. The board
Speaker 343
1:20:44
has not reviewed that yet. In terms of the competitive bids that Mr. Camp mentioned, the competitive bid that was referenced was for billboard advertising as part of the district's education and information program on recycling. A competitive bid or an RFP or an
Speaker 344
1:21:06
invitation to bid was not issued because there's only one billboard company in Pulaski County that we use.
Speaker 343
1:21:16
So we reviewed the proposal and accepted that. In terms of the credit card disbursements, there was a period of time between the unexpected resignation of the CFO and our contracting for a couple of months with a CPA firm to handled that. And during that interim time, we did not have credit card receipts. However,
the credit card statement and invoice lists all of the expenditures that were made and the finding did report that they all appeared to be for business use only. Let's see. The The other one was in terms of advertising expenditures. The district does advertise because, as you all know, I believe that if the, in our case,
Speaker 344
1:22:17
the residential customers in the county do not understand what can and cannot be recycled, recycling does not work. And
Speaker 343
1:22:27
so the expenditures for advertising, which appear to be greater than the average expenditures by other districts
Speaker 344
1:22:34
is very simply because advertising costs in Pulaski County are much greater than any other part of the state. So in terms of comparison with Northeast, Northwest, Southwest, Arkansas, we think they
are in line because of media costs are a lot more expensive here than they are there. I believe that answers those findings. Thank you. Thank you, Senator.
Speaker 160
1:23:00
all right i believe senator hammer has a question thank you mr chair just
Senator Kim Hammer
Unverified
1:23:06
uh clarify did you i took what you said to mean that there's only one billboard company in plash county was that your statement that we use yes sir
Speaker 343
1:23:18
that you use yes sir i'm not familiar with others uh billboard
companies that have a broad distribution throughout the county okay
Senator Kim Hammer
Unverified
1:23:26
and y'all came to that conclusion how or who would have brought that conclusion to you
Speaker 343
1:23:33
well our media representatives at the time which was an advertising agency we don't
Speaker 344
1:23:38
we know we now do all of ours in-house but we requested in the information that we provided them that we have a billboard company that covered the entire county okay and
Senator Kim Hammer
Unverified
1:23:51
they had agency that gave you that recommendation cmw okay and then i'm reading in
and the report says per the district, it is their practice to not remit or maintain receipts such as gas, meals, office supplies, etc. Is that
Speaker 343
1:24:08
the practice? No, sir. As I stated to Senator Wallace's question, there was a
Speaker 344
1:24:14
period of time of a couple of months between the unexpected resignation of our CFO and the contract that we had temporary contract for a CPA firm to handle that. we did not collect receipts.
However, all of those credit card expenditures are listed line itemed on the invoices we received and legislative audit commented that they all appeared to be and they were business related. Okay, very good. Thank you. Thank you, Senator. Senator Johnson.
Senator Mark Johnson
Unverified
1:24:50
Thank you, Mr. Chairman. Mr. Douglas, we asked last meeting, which was before the fiscal session so this is the first meeting since then yes
asking you to come I appreciate you coming these items are you please excuse me but I'm not satisfied with the explanation how many employees do does the district have five five and so four got a
company car so to speak is that fair enough to
Senator Mark Johnson
Unverified
1:25:28
allowance okay so it says that
based now this is I guess from Mr. Camp's
information that they're they do not have another vehicle available for personal
use and that the amounts were added to the W-2 but there was not mileage logs so basically these four
employees are three of the four however many are provided a car and can use it for
personal use and that is supposedly or at least more recently added to their W-2 as income. They are added to the
Speaker 342
1:26:12
W-2s at the end of every fiscal year
Speaker 343
1:26:15
at the end of every calendar year the employees fill out
Speaker 338
1:26:20
a worksheet to calculate the employee's taxable income related to personal use of the car. Okay.
Senator Mark Johnson
Unverified
1:26:26
Does that also apply to cell phones? They're provided with cell phones? Yes, sir.
Okay. And you said there was one other
employee. Does that employee get mileage per the IRS mileage rate or how are they coming? No, they get a flat fee
car allowance. And how much is that? I think it's
Speaker 338
1:26:46
two hundred and fifty dollars a month. Two hundred fifty dollars a month. Which probably should go up given gas prices but we'll leave that alone. Well of course that all depends on how much they're driving. Yes that particular employee handles a 27 county waste tire district district two. Okay now according to the report
Senator Mark Johnson
Unverified
1:27:06
your personal cell phone bill and district were not included on the on the W-2 is that correct senator I don't
Speaker 338
1:27:16
remember I'd have to report back to the committee on that to be happy
Senator Mark Johnson
Unverified
1:27:20
to do that and also how many years that if it has been corrected that's fine but we'd like to know when that correction took took effect when you did the the finding Thing number five about the billboard advertising, when you say there's only one billboard company
that we use, I mean, that's like saying there's only one, you know, car dealer that we use so we have to buy our cars from them. I'm not going to go along with that, but I'm, you know, I'm very sensitive to procurement especially when, and I agree, it costs more to advertise in Pulaski County and other places. On the other hand, $312,000 is a lot of money
for advertising for someone that's in the solid waste management business.
And I don't know this, but I bet that private companies like waste management probably don't have that high advertising budget for
that same area. Would you know about that? No, I
Speaker 338
1:28:26
don't know what their expenditures are. But I do know that our responsibilities are to educate the public on recycling, as encouraged by statute, to communicate and provide information so that they may properly recycle items.
And through that program, over the last four years, we have reduced the contamination of recycling carts from 52 percent to 25 percent. Do
Senator Mark Johnson
Unverified
1:28:54
the municipalities and the county have any say in dealing with solid waste management? Absolutely. What do they do
that's different from what your agency does? Our
Speaker 338
1:29:08
board is made up of all the mayors in Blaski County and the county judge. So they weigh in on everything we do quarterly.
Senator Mark Johnson
Unverified
1:29:18
Well, do you see your agency as more of an informational agency as opposed to an agency
that actually deals with the waste? No, we actually deal with it because we
Speaker 338
1:29:32
manage the contracts for the private sector contracts we have. It's been the philosophy of our district to employ private sector contractors, not to increase government employees, but to increase private sector employees. So we manage, we negotiate, and manage all of those contracts on a daily basis,
Speaker 354
1:29:53
and we also answer inquiries from the general public and refer those to
Senator Mark Johnson
Unverified
1:29:59
the private contractors. Okay. I just, this is probably a better question for Mr. Camp, Mr. Chairman, if I could ask him. Charlie, is there a, I hate to say formula, because formula is maybe not the right word, But in your statement, in the report, it says that the 312.977 in public monies for advertising, which appears excessive in comparison with amounts expensed by other districts in this report.
Can you compare, I hate to say compare and contrast too, but I'm going to ask, can you compare and contrast other districts, perhaps those that are not real rural, But no one's no maybe Benton and Washington County is as urban as we are
in Central Arkansas now, but is there When you say that it didn't
it appears excessive. Can you quantify that just a bit we?
Speaker 330
1:30:55
Kept this constrained to the districts that were within this report as a comparison and we did the
population and the amount per person kind of to make that Correlation we did not go out to any of the other districts. Well, that's fine and get that the 23-year the amount that they spent on advertising we did not get that we just made this
Senator Mark Johnson
Unverified
1:31:22
correlation based on amount per person and
is so if In these other districts the per capita expenditure for advertising was nowhere near as large as as the one in in in Pulaski County is that correct? That's correct. Is there a go back to is
there a comparison number is it twice as much four times as much? Isn't it this exhibit in
Speaker 330
1:31:44
the report? Which page is that? That is on page five or on page five of the report I'm not sure what page it'd be on this. Oh it's on that thank you Carol. wow
Senator Mark Johnson
Unverified
1:32:10
so it's 78.4 cents per person in pulaski county and it's uh craighead is 59 cents and then it Faulkner's 15 cents. No, I had said that wrong. It's 78.5 cents in Pulaski County, 5.9 cents in Craighead County, 1.5 cents in Faulkner County and Benton County, which probably is a little more comparable.
It's one-tenth of a cent per capita.
Does that sound about right? That's calculations, yes. Okay. Well, that is
a significant difference. I'm not, we could probably dive deep on
this. Before I release the mic, Mr. Chair, I want to ask one last question. Mr. Douglas, have y'all gotten
out of the art business? Are y'all purchasing art anymore?
Speaker 338
1:33:14
I have not, nor the board that I have served has approved any art purchases. I think what you're talking about is something that was done 12 years ago, 12 or 13 years ago. I'm familiar with it. Yes, sir. That was why I just wanted to make sure that... No, we don't purchase art. Okay. And the only other comment, if I may, Senator, on the advertising is that when you calculate the per capita on advertising, the auditors are using, and I understand why they're using the per capita of Pulaski County,
order to purchase Pulaski County media to reach Pulaski County residents and others you're purchasing media that reaches 75% of the state. So the comparison is a little off. Well you what you're basically and
Senator Mark Johnson
Unverified
1:34:01
correct me if I'm hearing you wrong when you advertise in the Democrat Gazette for example you're advertising to 75 counties because they circulate whatever is called circulation nowadays if they they have customers in those areas the other hand
if you do a radio station that just covers the southern half of Pulaski County then you're doing
Speaker 337
1:34:24
much smaller as far as newspaper paper you we buy the MSA we don't buy the whole town
Senator Mark Johnson
Unverified
1:34:33
they hold state but the MSA is six counties eight counties something is your organization eligible to use for your for your advertising
to be distributed to, say, radio stations. It could be a public
service announcement or other forms of media that would be free.
Speaker 432
1:34:54
Pardon me. I was just going to say, you were talking about asking one more question. We have others
in the queue. I will get out of the queue and come back at
Senator Kim Hammer
Unverified
1:35:04
the end, Mr. Chairman. Thank you so much. Senator
Hamer. Thank you, Mr. Chair. I want to give you an opportunity to explain something just to clarify. On the bottom of my report, page 5, it says between 2010 and 2016, bought 46 20-foot trailers for $248,000, and then they were sold to the vendor for a total price of $4,600,
which I assume that means for all 46 trailers. Can you
just explain? Because that's a big drop from what you all originally paid.
Speaker 343
1:35:35
And just help me understand. As I understand it and as the report was,
Speaker 344
1:35:41
those purchases were made in 2016. And when we sold them, we calculated the extensive use that the trailers had. Those were tire trailers that they had undergone, and we agreed to sell them back for $100. Okay. Which relieved the district from providing maintenance, which we could not any longer afford.
Senator Kim Hammer
Unverified
1:36:02
Okay. That's those trailers that have the high racks on the
Speaker 344
1:36:05
side that you... They're two different sizes. Some are the low profile and some are the high. Okay.
Speaker 311
1:36:12
All right. Thank you. Yes, sir. All right. Senator Clark,
Senator Alan Clark
Unverified
1:36:17
I believe you have a question. So, yes. Thank you, Mr. Chair. So is it the board's position, your position, that the advertising cost is
Speaker 338
1:36:26
not high? No, I believe I've been in the advertising business. I think it is quite high.
Senator Alan Clark
Unverified
1:36:33
And so, is that what you're going to continue to do? Is to spend multiple times more than
what other districts are spending per capita?
Speaker 338
1:36:44
Unless the board directs otherwise, we're going to continue to do what is the most effective way to reach residential customers to educate and inform them on the changing nature
Senator Alan Clark
Unverified
1:36:54
of recycling. I would argue with you and your advertising agency of whether you're doing what's
most effective. As a guy who's in business, furniture stores are not spending more per sale in Little Rock
than they're spending in Arkadelphia or Hot Springs. They budget according, and I can't just bill people for what I'm charging, what I'm doing in advertising. So instead of using billboards and newspaper, I'm using social media and getting a better return on my advertising by
Speaker 338
1:37:27
far than I used to. We include social media on a weekly basis, two posts a week. But how much good is social media doing versus your billboards and your newspaper?
I've always been told the anecdote that 50% of your advertising dollars are wasted. We just don't know which 50%. Well, see,
Senator Alan Clark
Unverified
1:37:48
I did a study at my store for years, I had every customer that came in, we asked, and we found that 80% of our customers were repeat in return, okay, so only 20% of our customers were coming from our advertising budget, and then when we found what was coming from 30 nickel, what was coming from TV, what was coming from radio, what was coming from newspaper, and so I'm going to tell you what you and your experts don't know, and since you were in advertising, I'm going to assume you were an expert, is that social media is by far doing the
good for the least money and you want to sit here as government and tell us it's okay we're just gonna keep wasting money that's what you want to tell us no so because as business we can't do that we have to figure out where where we're going to
spend it where we're going to get a return or we just
Speaker 344
1:38:42
don't exist anymore and our measurement is the contamination rate in the recycling carts at curbside and we've we've
Speaker 338
1:38:48
got that in half but if you've cut it in half you You know,
Senator Alan Clark
Unverified
1:38:53
sometimes I'll see bush, pork, and beans all the time for months,
and then I don't see them for two years. So at what point do you hit your effectiveness where it's time to cut it back? So you did some good, but why do we continue to hammer it? I mean, huge corporations don't do that. I mean, y'all are supposed to be the marketing experts, not this little lumber guy in Hot Springs. but I would argue with you I would go back to this report and I think you're
wasting money I think you're wasting the taxpayers money and you're being obtuse about it thank you mr. chair
Senator Dave Wallace
Unverified
1:39:38
senator Wallace you're recognized thank you mr. chair mr. Douglas
the failures that were sold to the vendor what what was the name of the vendor Davis rubber company sir
Speaker 432
1:39:52
are there any more questions senator Johnson
Senator Mark Johnson
Unverified
1:39:57
thank you mr. chairman and I'll try not to belabor this a couple more
things mr. Douglas senator Clark knows about lumber and flooring and types of things he deals with in advertising I know about trailers and cars and things like that. A 24-foot tandem axle trailer and I don't care whether it's a flatbed or has sides on it or whatever I guarantee you you put it on Facebook marketplace you can get a hell of a lot more than a hundred bucks for it. And I've
actually been looking for a trailer that would would haul my zero turn mower and most of them that would even it would even fit on that are old and maybe need tires and all that, we're in the $500 to $1,000 range used. So I mean I this this was very very troubling to me when I see this. Now again I don't know about there's not much information about the box truck, forklift, ramps, and shrink wrap, but I tell you what I buy just about any box truck or forklift that
anybody has out there for $2,500 I'll just put $2,500 down. If you've got a running truck and a running forklift I'll buy it because I could actually use the forklift around my little tiny shop for $2,500 I could I could use that so these are really troubling items to me and I'm and you know one of the things we do in this in this this committee is we find issues that our auditors have
it have identified and refer them to the prosecuting attorney and and they will sometimes come back to us and say do a deep dive on on these issues and I'm everybody makes mistakes and things pop up sometimes that aren't as they seem but these are so so much a red flag for me that I just I want you know I'm very very concerned about it but I do want to give you an opportunity to return to
Speaker 344
1:42:09
respond to my my question about that. We made the decision not to pay maintenance on those that equipment anymore some of it was older than 2016 as
Speaker 338
1:42:22
I recall I don't have the list in front of me but we wanted to get out of the trailer business and so we got out of the trailer business.
Senator Mark Johnson
Unverified
1:42:29
Mr. Douglas what kind of maintenance is there on a
Speaker 338
1:42:34
trailer? Well there's a great deal when you're hauling tires in it. I'm not a mechanic I can't tell you precisely. Well
Senator Mark Johnson
Unverified
1:42:41
I'm kind of a mechanic I'm very
amateur well I can tell you primarily you're looking at wheel bearings and tires. Now sometimes springs you know and spring
shackles can break and all that but unlike something that has a motor in it you know a trailer unless you drove it off a cliff and you had to weld it back together. Maintenance is, like I said, wheel bearings, tires, maybe a bent rim has to be replaced. This is but but
the idea that they're only worth you know a hundred bucks is it's ludicrous to me and I'm again you you just stipulated
that you're not a mechanic and I accept that stipulation but does your agency utilize marketing and redistribution, which is a state agency? No, we don't. Okay. Do you know if this, that's probably a Mr. Camp question. Are they required to use it, Mr. Camp, or that's only state agencies that require? Not that I know of. Okay, that might be something to look at.
I'll just stop with that. Thank you, Mr. Chairman. All right, Representative Dalby. Thank you, Mr. Chair.
Representative Carol Dalby
Unverified
1:43:46
this is for Mr. Camp in this report and you'll have to educate me because I'm not quite sure what if
we're comparing apples to apples or apples to oranges and I understand there's some
size difference from population but let's just say oh the Craighead County or the Southwest Arkansas County solid waste management they're dealing
with tires and recyclables and all these things that Pulaski County is, am I
Speaker 384
1:44:19
correct in that assumption? No, the Pulaski County
district actually covers the tire program
Speaker 330
1:44:25
for Craighead and I believe Faulkner in this report. The other three districts at the time
Speaker 360
1:44:31
were running their own tire program. Okay but I guess my I'll
Representative Carol Dalby
Unverified
1:44:37
get to my question but my point they're essentially doing the same functions I mean they're being a solid waste management district correct yes ma'am
and when I read this report unless I've misread it some don't have any findings they
ran there they ran it like
it's supposed to be ran is that run
Speaker 360
1:45:02
is that correct that's correct it based on the parameters of
Representative Carol Dalby
Unverified
1:45:05
our review okay and then I noticed that oh
the ones that had findings they may have had one or two and they immediately addressed them like we're normal normally see we recognize that yes there's a problem we acknowledge that there's a problem and here's what we're going to do to
fix it. Most times. Most of the time I noticed that and so my question is and maybe if I
may turn to the witness yes so my question then is I've read your response I've been listening to all the questions and I've read the response and I've read your read your attached letter I've read what the management responses were in this and it it appears to me that your particular district didn't take ownership and a lot of these issues it was like oh well that's what's a better kind of brushed it off that maybe well the auditors yes they they said that but
oh we've got the receipts and there was never any
yes that's correct and this is what we're going to do to fix
Speaker 344
1:46:22
it all of the recommendations that the auditors have made we have reported to the board we have a we have a new chairman of the board it was elected at the April meeting he and I are meeting next week on the recommendations and so that the board can consider at the August meeting
whether or not to change some of the procedures and the approvals the board considered the each of the areas that the audit has produced findings on and And we'll address those at the next meeting, whether or not they want to change the procedures. So we do take them very seriously. Thank you for
Representative Carol Dalby
Unverified
1:47:08
the follow-up, Mr. Chair. So when was that board meeting that, because this is dated March the 3rd.
Speaker 397
1:47:17
Yeah. So when did you have that board
Representative Carol Dalby
Unverified
1:47:19
meeting? April. And so I guess I'm just a little confused as to why this is not important enough that you don't have another meeting before August. I mean, these are some serious findings, and we can argue about whether or not you sold the trailers for the right amount of money, or did you have the right receipts, or did you pay people without the proper authority? My question is, why did you not call, or somebody not call another meeting until August?
I mean, we're rocking along now April, May, July, you know, May, June, July, you know, quarterly and once again it at least appears to me and maybe not to my fellow colleagues around this table but it appears to me that oh well so this has happened we'll just address it somewhere down the road instead of seeing the immediate concern so my question is do you have a procedure to hold an emergency meeting and if so why did you not have one before August of this year
Speaker 344
1:48:24
we elected the new chairman in april he and i have met once we're meeting again next week including meeting with the prosecuting attorney elect that's coming into office in january to see if the board i don't call the emergency meetings the board does but to see if the chairman wants to call on a meeting and address any of these findings we delayed that until after this meeting. Do you
Speaker 402
1:48:53
have a new information or a new question? All right. Thank you,
Senator Mark Johnson
Unverified
1:48:59
Mr. Chairman. Who is your new chairman, Mr.
Douglas? Derek Rainey, who's the mayor of Wrightsville. Mayor of Wrightsville? Yes. Okay. And so all your board members are mayors? And the county judge. And the judge. And of course, Judge Hyde sadly lost his primaries. So there will be a new person representing Pulaski County in 2027. Mayor Rainey is the newly
Speaker 344
1:49:24
elected chairman of the board. Okay. Thank you.
Speaker 432
1:49:29
Thank you, Mr. Chairman. Thank you. Do you have a question, Senator Wallace? All right. Seeing no other questions, do
we have a motion to file this report? Bert, I got a motion. Do we need a second? I don't see a second, so I guess
Speaker 303
1:49:51
it fails for a lack of a second. Are we deferring it for additional meeting? We defer it until September.
Speaker 432
1:50:01
All right. So we do have a motion to defer it until September? Second. Second. Any discussion on the motion?
Speaker 405
1:50:15
All in favor say aye. Aye. All opposed? The motion carries. Can I get clarification? Are we inviting
Speaker 432
1:50:22
Lassie County's executive director back again? Yeah, I think that would be good, Mr. Douglas, if you could come. Thank
Speaker 11
1:50:30
you so much. I'm continuing with reports that were previously deferred.
On page 4, we have the town of Biggers 2024 under the mayor. I ordered a agreed upon procedure report and compilation has not been completed for the water sewer since 2016, as required by Arkansas Code. This finding has been a repeat finding in the previous three reports. We have Mayor Victor Conrad Zitzenberger here today. Staff
Speaker 10
1:51:00
note, Town of Biggers is currently having their turn back escrowed due to the lack of water and sewer.
Speaker 410
1:51:12
for the record, please? Mayor Conrad Zitzelberger of Biggers. I apologize. That's fine. Do you have an opening statement? I just want to say we are working on those audits. I took office in 2023. I can't speak for the former mayor, but yes, 2016 was the last audit. Barry and Associates is who we have that's just trying to work on it.
They have 2017's. The lady that was working or starting on it has retired. And I do have emails that are stating where somehow when she retired, it got kind of lost in the system there. But they are trying to reassign that as of now to get 2017's going. Of course, Biggers is, you know, a small town.
We have no full-time employees. 300, I think, is our population. So we're trying our best to get it done. We apologize. We do know it has to get done, and we are going to get them done. And I just can't give you a timeline on getting them all done, but we're going to
Speaker 432
1:52:33
work as hard as we can to get them done. All right. Does anybody have any questions of the mayor?
Say no question. Without objection, we will file this
report. Mayor, you're dismissed. Thank you. Thank you,
Speaker 21
1:52:54
sir. Continuing on page 5 and 6 with previously deferred reports, we have the town of Gilmore,
Speaker 11
1:53:00
2024, under the mayor and recorder treasurer. Schedule 1 of this report shows a general fund balance of $653. It was brought to our attention that as of December 31st, 2024, the general fund owed a significant amount to the IRS and DF&A for taxes owed, as well as a balance to the street and fire equipment and training funds.
Shown in note 5 on Schedule 3, when these outstanding amounts are considered, the general fund has a deficit fund balance of over $54,000. This is a repeat finding in the previous five reports. I believe Mayor
Speaker 17
1:53:33
Bruce Delaney is here to answer questions. Mayor, would you state your name
Mayor Bruce
Unverified
1:53:47
for the record, please? My name is Mayor Bruce Delaney from the city of Gilmore. Now, do you have an opening statement?
Speaker 412
1:53:56
Yes, on the IRS, we just compromise with them for a plan to get this paid. We worked on it in our, also on our street department, we paid that off in October of 2025. And the author came in and she looked at it because they had took our turn back money. You know, they had took our turn back money. So they told us it was not going to get our turn back money back until we got this paid.
Okay, we got it paid. We got it with the author. Then the author called them back and told them that we had it paid. So we should have this paid back. So we shouldn't owe this for the streets no more. That is correct. I can verify that. And also, they are saying on the fire department, you know, she's saying we're owing something like around 3,000 or something dollars on that. But, you know, what she didn't really look at, what we really paid on that is all that was municipally that we owe,
and we owe back pay because, you know, we didn't have the money, didn't really keep our fire insurance going. it was the fire insurance and we was behind on it and so we had to come back and come back and pay the years that we didn't get paid because you know we're small-town we didn't have the money you know to keep college with the fire
department stuff but you know we doing the best we can to make sure we get everything straight and you know tomorrow where I mean I think that you know we did good we don't got this cleared up so only thing we really worked on at this our is and we are working on it now to get
Senator Alan Clark
Unverified
1:56:03
it get it taken care all right does anyone have questions of the mayor Senator Clark mayor thank you for being here what's
Speaker 412
1:56:12
the population of Gilmore we might have I have 160 people not because people study leaving with small
town thank you thank you mr. chair
Speaker 432
1:56:25
thank you all right with that objection we will file this report
Speaker 11
1:56:31
thank you mayor thank you dismissed all right thank you sir continuing on page six previously deferred reports we have the city of Holly Grove 2024. It actually goes over on page seven. That's where we'll start. Under the treasurer, county procedures for municipalities are set forth in Arkansas code annotated 1459,
101 through 119. The city was in non-compliance with these codes and other county procedures as follows. Bank reconciliations contain numerous errors. Cash receipts and disbursement journals were not properly posted or reconciled
Speaker 10
1:57:04
with bank deposits and withdrawals. Checks were not always voided properly, and a fixed asset listing was
Speaker 11
1:57:09
established, but did not include all additions and deletions. This is a repeat finding. I believe we have Treasurer Ruthie Foster here today to answer questions.
Representative Carol Dalby
Unverified
1:57:24
Mr. Chair, Ms. Foster, may I ask Mr. Archer a question? Yes, please. Mr. Archer on page 6 of the Holly Grove report you didn't or I didn't hear you said their expenditures exceeded appropriations by $140,000 have we determined why or is
that all due to all the accounting and reporting area areas errors on page 7 we just
Speaker 27
1:57:56
basically compared the budget to actual and then
we test the actual so we didn't find anything that was uh outside the law as far as those actual expenditures so we didn't really tie
Speaker 25
1:58:06
it down to exactly what they overspent on okay so it wasn't like uh an employee misappropriating
Representative Carol Dalby
Unverified
1:58:12
no ma'am no ma'am okay thank you that was my question it just raised that was a big number they basically just didn't amend
Speaker 25
1:58:18
the budget at the end of the year okay
Speaker 258
1:58:23
thank you ma'am ma'am would you state your name for the
Speaker 421
1:58:26
record please Ruthie Foster, City Halley Grove, Treasurer.
Speaker 144
1:58:30
Yes, scoot a little closer to your mic, please. And
do you have an opening statement? No, I do not. Are there any questions of Ms. Foster? Representative Dalby. How
Speaker 422
1:58:46
long have you been to Treasurer? I got it, I think it was around February of 2024. I was the water clerk. Thank you. Any other questions?
Speaker 432
1:59:01
Without objection, we'll file this report. Ms. Foster,
Speaker 21
1:59:09
you're dismissed. Thank you. Continuing with previously deferred reports, on pages
Speaker 11
1:59:15
9 through 11, we had 18 previously deferred water and sewer reports due to a lack of proper responses. Since then, we have received responses from 11 of these. They are at Bearden 2024, 23, and 22, Central City, Cushman, Fulton, 24, and 23, Morrow, 24, 23, 22, and 21.
Staff recommends that we file these
Speaker 94
1:59:53
reports. Without objection, we will file these reports.
Speaker 11
2:00:03
Just one second. Let's try to get all my notes done. Also in that group, there was seven reports that we have not received proper responses on.
That would be McCray 24, Montrose 24, Van Buren County Water 24, West Saline 24, West Grove Water 23, and Wilmer 23 and 22. Staff recommends that we defer these reports. Without objection,
Speaker 432
2:00:30
we will file this report. Defer, please. Excuse me, defer these reports.
Speaker 21
2:00:53
reports that we have certified to the bond board and referred to the prosecuting attorney in AG's office. Starting on page 12, we have the
Speaker 11
2:01:02
Shannon Hills Water, Sewer, and Fire Department. It's a 2024 report, and this is a private report. During the audit, it was discovered that the office manager had misappropriated funds
Speaker 10
2:01:14
by submitting false invoices and had written checks to themselves using a signature stamp found in the office.
Personal expenses were also being charged with a city
Speaker 11
2:01:24
credit card. It was noted that the NC lacked adequate internal controls over cash, check, and credit card handling processes. Specifically, there is no segregation of duties between the individual responsible for writing
Speaker 10
2:01:38
checks, recording transactions, and reconciling accounts. We also note that a stamp for signatures was being misused in the office and that the bank accounts were not being reconciled in a timely manner nor reviewed by management or the governing body.
This is a repeat finding. Supporting invoices and receipts were not available for many transactions in the year ended December 31st, 2024. These two findings have been reported to the prosecuting attorney and AGs, and the first finding was certified at the bond board. There are no questions. Staff recommends we file this report. Without objection,
Speaker 11
2:02:18
Continuing on page 13 through 15, we have the town of Carthage under the mayor and recorder
treasurer. Former recorder treasurer Christopher Ogburn, who resigned on June 1, 2023, was not
Speaker 10
2:02:32
removed from the town's bank accounts at the time of his resignation. Subsequently, he made unauthorized cash withdrawals, totaling over $52,000 from the town's account from April 11th to May 28th, 2024. Ogborn
Speaker 11
2:02:47
entered a negotiated plea of guilty of theft of property on December 17th,
Speaker 10
2:02:53
2025 and was sentenced to 120 months of probation
and was ordered to pay restitution totaling $50,200. Accounting procedures for municipalities are set forth in Arkansas Code Annotated 1459-101-119. The town was in noncompliance with these code sections and other proper accounting procedures as noted below. Prenumbered checks were not issued for all disbursements. This is a repeat finding. Monthly financial reports approved by the town council
Speaker 11
2:03:22
were not accurate. This is a repeat finding. Electronic disbursements were made
Speaker 10
2:03:28
without proper approval of the town council and without
establishing a written policy and procedures to ensure that the ETF payment system provides internal accounting controls and documentation for audit and accounting purposes. This
Speaker 11
2:03:41
is a repeat finding. Fixed assets were not properly maintained. This was a repeat finding. Annual financial statements were not published or posted since previous six reports. Bank accounts were not reconciled. This is a repeat finding since 2018. Pre-number receipts were not issued. This is a repeat
finding since 2018. Cash receipts journals were not properly maintained. This is a repeat finding since 2018. Cash disbursement journals were not properly maintained. This was a repeat finding since 2018.
Speaker 10
2:04:18
Cash restricted for street purposes totally over $19,000 was transferred to the street fund in 2016 from the, excuse me, was transferred from the street to the general fund without supporting documentation. In 2024, the town spent $688 from the street fund that was inconsistent
Speaker 11
2:04:38
with the Arkansas Code. In the prior year, $2,500 was transferred from the general fund to the street fund, leaving a balance due of
Speaker 10
2:04:49
over $17,000 at 12-31-24. The town obtained authorization from the Legislative Joint Audit Committee for repayment of $170, or 10% of general revenue monthly at the December 11th, 2025 committee meeting. This is a repeat finding since 2016. Continuing on page 14, a review of disbursements revealed that supporting documentation was
not maintained with the following disbursements in noncompliance with the Arkansas Code. Almost $700 or 13% of disbursements tested due to a lack of documentation, the validity and propriety of these disbursements could not be determined. Just over $1,000, or 21% of disbursements, tested to vendors that appear to be for legitimate business purposes. However, supporting documentation was not available. Additionally, proper authorization was not obtained for six disbursements tested, totaling over $2,000.
This is a repeat finding in the previous two reports. On page 15, under the mayor, budgets were not adopted by ordinance or resolutions in noncompliance with Arkansas Code. This is a repeat finding. The audit agreed upon procedures report for the water and sewer system was not obtained in noncompliance with Arkansas Code. This is a repeat finding the previous four reports dating back to 2016. Mayor Sean Randall is here to answer questions. Staff note, as of May 27th of 2026,
Speaker 21
2:06:16
all of the outstanding water and sewer reports have been filed for the city of Carthage
Speaker 29
2:06:23
And their reinstatement letter was delivered to the treasurer, so they should be back on track on
Speaker 432
2:06:33
June 10th. Mayor, would you turn your mic on and state your name for the record, please? Yes, Mayor. Sean Randall of Carthage, Arkansas. Do you have an open statement?
No, sir. Does anybody have any questions of the mayor? Representative
Representative Johnny Rye
Unverified
2:06:51
Rye? Yes, sir. Can we go into the program where we're at, Senator Stone, to ask a question?
If you need to. Okay. On page 13, street money actually was transferred to the general fund. Yes, sir. That's not supposed to be that way.
Speaker 437
2:07:13
Yeah, when that happened, I wasn't mayor at the time. And so since I've been mayor, we've been paying it back. Actually, how the speaker said it was like $17,000, I think, the last report.
Now we have it down to a remaining balance of $6,000. So we've paid $11,300 back in the last nine months. And so, but yeah, when I took over the mayorship, I think that bill was like $19,000 and something. Like I said, we've been working real hard on it, being that we haven't had our street fund money, so we've been having to make bigger installments as far as paying that money back
to pay city workers and take care of street bills. But in the meanwhile, it's knocked it down to like $6,000, so from $19,000 down
Speaker 432
2:08:13
to $6,000. Yes, sir, and that's a good thing that you know that.
Speaker 311
2:08:19
That's very important. Yes, thank you, sir. Thank
Senator Alan Clark
Unverified
2:08:22
you. any other questions of the mayor senator Clark yes mayor thank you for being here thank you mr. chair what is the population
of Carthage I think about 341 okay my compliments on you riding the ship and getting paying things back
Speaker 311
2:08:38
and and keep them in order yes sir I hope you'll keep
Senator Mark Johnson
Unverified
2:08:46
that up thank you mr. Chair. Senator Johnson. Thank you, Mr. Chairman. Mayor, thank you for
coming. I agree with Senator Clark's comment. My question is actually for Mr. Archer. The former recorded treasurer who absconded with the money, $52,500, he was sentenced to
120 months probation in order to pay restitution totaling $50,200. does legislative ought
to know if that money has been paid that restitution we
Speaker 29
2:09:14
are not we haven't checked on that yet I mean it was just in 25 so it's been five months ago so I will we we usually get reports on that and you do get reports
Speaker 47
2:09:24
and okay we we check on it from time to time so we can't okay great thank you sir
Speaker 432
2:09:34
thank you mr. Chairman all right without objection we'll file this report. Mayor, you're dismissed. All right. Thank you, sir. Thank you. Continuing
Speaker 21
2:09:45
with reports certified to the bond board referred to the prosecuting attorney and AGs on
Speaker 10
2:09:50
page 16. We have the town of Mount Vernon.
Speaker 11
2:09:56
Mayor Jonathan Hawkins was invited here today. He requested that we defer this to August. Staff recommends that
Speaker 427
2:10:03
we defer this. Without objection, we'll refer this defer this report? We have
Speaker 11
2:10:10
10 reports that refer to the prosecuting attorney in the AG's office. The first
one's on page 17. It's an investigative report on the city of Fort Smith. Review of selected financial records for January 1 of 2024 through October 7th of 2025. We have staff member Ross Baldwin here that will come and present this report. Thank you and good afternoon.
Speaker 442
2:10:51
This report is issued in response to a request from the 12th Judicial District Prosecution Attorney for legislative audit to review transactions in apparent conflict with Arkansas Constitution article 12 section 5 at the city of fort smith our review covered the period january 1 2024 through october 7 2025 legislative audits review of city expenditures from the special events fund
revealed that the city dispersed funds totaling 170 000 and 170 000 and seven dollars during the the review period without a contract for services or documentation to support a public purpose in apparent conflict with Arkansas Constitution, Article 12, Section 5. These transactions appear to be donations and sponsorships such as $30,000 to the Steel Horse
Rally, $20,000 to Mercy Health Foundation, and $15,000 to Fort Smith Roundtable in Care of Juneteenth, and various other nonprofit organizations. Management response is included in the appendix of this report, and the report has been referred to the prosecuting attorney and the Attorney General's office. Thank you very much. That concludes my presentation.
Does anybody have any questions of
Speaker 432
2:12:36
Mr. Baldwin? Saying none, without objection, we will file this report. Thank you,
Speaker 21
2:12:44
Mr. Baldwin. Continuing on pages 18 through 20, We have another investigative report on the Hector Rural Volunteer Fire
Speaker 11
2:12:52
Department, review of selected financial records from January 1, 2023 through August 31st of 2024. We have staff member Anthony Weston here to present this report.
Speaker 446
2:13:09
So this report is issued in response to a request from the 5th Judicial District Prosecuting Attorney for legislative audit to review selected transactions of the Hector Rural Volunteer Fire Department. This review was conducted primarily for a period of January 1st, 2023 through August 31st, 2024. Based on our review of revenues, deposits, it does not appear that all membership dues and fundraising proceeds were deposited in the department's bank account. Due to a lack of records, the amount of unaccounted for funds could not be determined.
Our review of selected disbursements revealed improper disbursements totaling $8,333. These improper disbursements consisted of transfers to personal bank accounts, payments on personal credit card accounts, an undocumented cash withdrawal, personal expenses, and fundraiser change not redeposited. In addition, the validity of $4,689 in undocumented vendor payments cannot be determined. Secretary-Treasurer, who resigned in August 2024, was custodian of the funds.
Management response is located in the appendix of the report, and this report has been forwarded to the 5th District Prosecuting Attorney and the Attorney General.
Does anybody have any questions, Mr. Weston? Saying none, without
Speaker 21
2:14:38
objection, we'll file this report. Continuing on pages 20 through 22, we have another investigative report. The city of Horseshoe Bend, Review of Selected Financial Records, January
Speaker 10
2:14:49
1 of 2023 through September 30th of 2025.
And again, staff members, Anthony Weston will present this report.
Speaker 446
2:14:59
This report is issued pursuant to a request by the 16th Judicial District PA for legislative audit to review selected transactions of the city of Horseshoe Bend. This review was conducted primarily for the period January 1st, 2023 through September 30th, 2025. ALA staff review of city budgets revealed that budgets were adopted by ordinance or resolution as required by Arkansas Code, and employees selected for testing were paid in accordance with these budgets.
Review of selected disbursements revealed $25,667 in undocumented disbursements, the validity of which could not be determined. Additionally, bids for a construction project were obtained but not properly advertised, and the city contracted with a company owned by a council member without an authorizing ordinance. A review of insurance proceeds and disbursements following a storm revealed the city prepaid $57,463 to a contractor for roof repairs before work began
in conflict with Arkansas Constitution, Article 12, Section 5, and the repairs were not completed until a year later. Management response is located in the appendix of this report, and this report has been forwarded to the 16th Judicial District Prosecuting Attorney and the Attorney General. Does
Speaker 432
2:16:15
any member have a question of Mr.
Weston? Saying none without objection, we'll file this report. you're not recognized
sir from the audience no you cannot be recognized please be seated
Speaker 449
2:16:31
continuing on page 23 thank you continue on
Speaker 21
2:16:44
augusta 2024 this is a private report start on page 24 During the course
Speaker 11
2:16:52
of the audit, it was noted that the city wrote off and made adjustments to utility receivables without additional documentation to support these actions.
Additionally, it was observed that the city council had not established former policy and procedures governing the process of writing off utilities receivables. This is a repeat finding. During the audit, it was observed that the city dispersed checks to employees without maintaining adequate documentation for the expenses. For Arkansas code, a disbursement of municipal funds shall have adequate documentation for the disbursements. Both these findings have been referred to the prosecuting attorney in the AG's office.
Speaker 427
2:17:34
Staff recommends we file this report.
Speaker 21
2:17:43
Without objection, we will file this report. Continuing on page 25, we have the city of Magnolia, 2024,
Speaker 10
2:17:51
under the city treasurer. In December of 2024, the city initiated two direct deposits, totaling over $2,600, to a fraudulent bank account after receiving an email request to change the employee's direct deposit information without verifying the authenticity of the request.
The city notified the banking institution but was unable to recover the funds. Under the Mayor and Advertising and Promotion Commission Chairman, the city paid $1,150 to reimburse a private business for its private business advertising expenses using advertising and promotion tax revenue in noncompliance with the Arkansas Code. In addition, this transaction appears to conflict with the Arkansas Constitution, Article 12, Section 5, as interpreted by Attorney General 2008-121.
Speaker 14
2:18:38
If there are no questions, the staff recommends we file this report. Without
Speaker 11
2:18:46
objection, we'll file this report. On page 26, we have the town of Alpena for 2024, 23, and 22. The Court of Treasurer, Roberta McAllister, was invited here today. She requested to defer this report.
Speaker 14
2:19:00
Staff recommends we defer this report. Without objection, we will defer
Speaker 11
2:19:07
this report. Page 27 of the city of Bradley, 2024, under the mayor and police chief, fines and costs
revenue of over $109,000 exceeded 30% of the town's total expenditures in the preceding year by $14,110 in noncompliance to the Arkansas Code. This revenue was generated from traffic offense citations written or by arrests made by the city's law enforcement personnel. This finding has been referred to the prosecuting attorney in the AG's
Speaker 10
2:19:35
office. Staff would like to make one quick note on the finding below. It's not one required to be read, but they paid their bill to the street fund in full.
We verified that in June of 2025. There are no questions. Staff recommends we file this report. Senator Carr, you have a question. Thank you, Mr. Chair.
Senator Alan Clark
Unverified
2:19:58
Was that a one-time finding on the speed truck? It was not a
Speaker 24
2:20:03
repeat finding, so they didn't have this issue in 23. Knowing the history, it's not
Speaker 25
2:20:10
the first time. But it's over a long history. I'm not going to say it was two years ago. It might have been 20 years ago.
Senator Alan Clark
Unverified
2:20:18
So if someone does exceed this, although we've got a report here and it's turned over to the prosecutor, if nobody does anything, they just get their hands slapped and go on to continue being a speed trap.
Speaker 27
2:20:34
When in this case, the prosecutor ordered, we have a letter, the prosecutor ordered that $14,110
Speaker 10
2:20:40
be paid to school districts in that city's area. Okay, thank you.
Senator Mark Johnson
Unverified
2:20:49
Yes, Senator Johnson. Thank you, Mr. Chairman. Mr. Archer, is that authorized? I get the fact that the prosecutor has some discretion here, but does that type of payment, is that
authorized under the law? Or is this totally, I mean, I'm just saying the prosecutor could say we want this to make a restitution to some affected agency that was hurt. But is there that much discretion to say we're going to give it to the school district? And I'm not against giving it to the school district.
I just wonder what the authority to do that.
Speaker 85
2:21:22
It's my understanding that we report to the prosecutor that they failed the speed trap test. And the
Speaker 25
2:21:27
prosecutor has the authority to take whatever action they see fit. including if you'll give money to the
Senator Mark Johnson
Unverified
2:21:34
school district you're off the hook i guess um thank you mr chairman when i heard that i had
a little trouble with it and i checked on it and they can do that by statute and my thoughts was was all right the city can't have it but we'll just give it to the school district and it's still staying in house so but that's the way the current law is
Speaker 27
2:21:54
so we'll just move forward with that the actually charlie's informed mr campus for me that that the The law actually reads that way, that they do
Speaker 432
2:22:08
have that option in the statute, that they can pull that money to the school district, yes.
Speaker 11
2:22:16
Thank you, Senator Johnson. Without objection, we will file this report. Continuing with reports referred to the Prosecutor Attorney Nagee's office, page 27 and 28, City of Callion, 2024 and 2023, under the Mayor and Treasurer.
The city treasurer was paid to perform additional services as the water, sewer, and sanitation clerk. These payments were made without an authorizing ordinance in apparent conflict with Arkansas Code. Additionally, in conflict with the city's policy, they accrued more vacation days than the water, sewer, sanitation clerk position is allowed and received over $2,800 and over $1,400 in 2024 and
Speaker 10
2:22:56
2023, respectively, for unused sick and vacation leave in excess of the allowable amount.
The city paid $1,900 and $760 in 2024 and 2023, respectively, to a council member for various services without an authorizing ordinance in apparent conflict with the Arkansas Code. Additionally, IRS Form 1099 was not issued or reported to the IRS for these funds. There are no questions. Staff recommends
Speaker 14
2:23:25
we file this report. Without objection, we will file this report.
Speaker 11
2:23:37
Page 31, we have a Wabaseka Water and Sewer System, 2024-2023. This is also a
Speaker 21
2:23:45
private report. We selected 10 dates during 23 and 24 that we requested payment tape reports, which detailed payments applied to each customer's account for
Speaker 11
2:23:58
the date selected and related deposit slips. For the following selected dates, documentation was not available, and we were unable to complete the procedure.
January 3rd, February 15th, and March 23rd of 2023. Adequate supporting documentation was not maintained for two invoices in 2023. No documentation was
Speaker 10
2:24:24
available to support hours worked or duties performed, and there were no contract or agreement specifying reimbursement or Apple rates
Speaker 11
2:24:35
of pay for two employees in 2023 and one in 2024.
Speaker 14
2:24:41
If there are no questions, staff recommends we file this report.
Speaker 11
2:24:48
Without objection, we will file this report. We have 10 reports with repeat
Speaker 21
2:24:54
findings, starting on page 32 of the city of Eureka Springs, 2024.
Speaker 10
2:25:03
code requires city management to obtain federal compliance audit when federal expenditures exceed $750,000. City had federal expenditures in excess of $750,000 in 2024, '23, '22, and '21, but
due to management oversight did not obtain federal compliance audits as required. The City could be responsible for repayment of federal expenditures if instances of noncompliance were noted during the federal compliance audit. We recommend the City obtain federal compliance audits for each of the respective years. This is a repeat finding. Under the
Speaker 11
2:25:37
finance director, monthly bank reconciliations will not perform properly as required of Arkansas Code. This is a repeat finding in the previous four reports. I believe Mayor Robert Berry and finance director Michael Aikens here today to answer questions.
Speaker 432
2:26:05
If you would, make sure your mics are turned on and state your
Speaker 459
2:26:13
names for the record, please. Robert Berry, Mayor of Eureka Springs. Michael Lakins, Director of Finance for Eureka
Speaker 460
2:26:18
Springs. Mayor, do you have an open statement? I'm going to defer to the Finance Director. Most of this has to do with our audits. I think we are up to date with the
Speaker 459
2:26:29
exception of the 23 audit. Our, you know, and what he said was that, you know, it was an oversight.
Speaker 461
2:26:36
It's not an oversight. We have been working diligently to get these audits done. We engage with Forbus to do our audits. We just can't get any progress with them. They have the information. They have, we have not kept them from anything. We give them proper documentation. We just can't get them to complete the reports. 20 and 21 are completed. 22 is about three-fourths of the way completed, 23 and 24 they haven't started on, and 25 we don't have to have one.
So we are working on it. We've been working diligently on them. We just can't get any response from the audit teams. Is this an accounting firm, a private audit? Yeah, it's a separate audit from leg audit. So they've had this information
Speaker 432
2:27:24
for all these years? Yes, we have provided it
Speaker 461
2:27:27
with them. Well, I mean, we provide it to them as they work on the years. They do our water sewer audits, and we were behind on those, so we got those up to date. And now they're working on the single audits, trying to get those up to date.
Speaker 432
2:27:42
I'm just sitting there thinking if they can or won't do the audits, did the thought ever occur to you to gather your information up and go find another CPA firm?
Speaker 461
2:27:51
Yes, we have tried that, and we haven't been able to every other CPA firm that we have reached out to that's been a size of four of us, we're getting the same pushback. I talked to Marcus, which is our auditor. I talked to Marcus. He, even some of the companies that I asked him about, they said they had other issues with them in leg audit, of them being behind on their audits, too. Okay.
Speaker 432
2:28:13
Are there any questions by members? Representative Rye? Yes, sir. Thank
Representative Johnny Rye
Unverified
2:28:18
you, Mr. Chairman. Fellas, this first paragraph, could you explain that a little bit to us? It's $750,000, and it says that if you spend
in excess of $750,000, that you actually have to okay that through the federal government. Is that right? What it's
Speaker 461
2:28:35
saying is that if we receive over $750,000 in federal money, then we have to have an audit of that federal money to make sure that we used it for what it was intended for or what we received it for.
a lot of that comes because we have in Eureka we're a tourist town so we have an extensive transportation department which we receive a lot of federal funds for that to help fund that transportation department and so that's usually what kicks us over the benchmark of where we have to have these single audits so we have our leg audit we have our water audit and then we have this audit on top of the other two.
Speaker 465
2:29:15
Thank you, sir. That's a good answer. Senator Clark?
Senator Alan Clark
Unverified
2:29:21
One of these findings is repeated four times or repeated three times. So how long have you been in this job? Four years. And how long has this CPA company had this information? We've been using four of us for probably
Speaker 461
2:29:41
the last, they were BK and D before we've been using them for probably about 10 years at the city. So it's kind of like what they were talking about earlier.
When you start with a new company, they have a lot of groundwork that they have to put in to get you up to date. So sometimes you stick with the company that you've got, even though they're delayed in getting you the reports. Even though they're delayed four years? Well, you know, we were behind, when I took over, it was right after COVID, and we were behind on the water audits and the single audits. So we were trying to get them, but we're a small town. We're trying to get all of the three audits done in a year with a small staff.
So we focused on the water audits to get those up to date, and now they're working on the single audits to
Speaker 460
2:30:32
get those up to date. All right. Thank you. And in response to the chairman's request or question about looking for, seeking out other accounting firms, we are in the process of doing that. We have been fighting literally with Forbes for three or four years of trying to get this done and get them done. They've had the information. And so we have been in contact and trying to locate another auditing firm to take over for our future audits.
Speaker 426
2:31:01
Okay. Are there any other questions? without objection we will
Speaker 21
2:31:11
file this report thank you for your time thank you page 33 with
Speaker 11
2:31:17
the city of cotton plant 2024 mayor clara harrison brown was invited here today she had a conflict
Speaker 14
2:31:22
she was out of town staff recommends we defer this report without objection we
Speaker 21
2:31:29
will defer this report. Continuing on page 34, we have the city of Falk 2024. Mayor Terry Purvis
Speaker 27
2:31:36
called this morning. He had a health incident and can't be here today, so staff recommends we defer this
Speaker 427
2:31:44
report. Without objection, we will defer
Speaker 21
2:31:48
this report. Page 35, we have the city of joiner 2024 under the recorder
Speaker 11
2:31:54
treasure where the the bank statements of the general street and public safety funds were not properly reconciled in non-compliance arkansas code this is a repeat finding the previous eight reports general funds cash disbursements journal was not properly posted
non-compliance the arkansas code so repeat finding the previous three reports quarter Treasurer Josie Valdez is here to ask questions. I apologize. If you would, would you ladies state your name
Speaker 432
2:32:20
for the record, please? Josie Vaskers, Treasurer. Elizabeth McCollum, Council Member. Okay.
Speaker 471
2:32:26
Do you have an open statement, ma'am? I
don't. Does any members have a question? Senator Clark, you're recognized. What's the population of Joyner? Under 500.
Senator Alan Clark
Unverified
2:32:44
About 498. By the way, thank you, Mr. Chair. Thank you
all for being here. Eight times, I'm going to say that I'm speaking for everyone when I say that's particularly bothersome to why we even meet if we're not going to fix this. Why in the world would anything be, after it was reported to me the first time, second because I hate book I hate paperwork I hate book work but after it's reported to me the first time my staff would be sure the next year but the second time
the third time the fourth time the fifth time the sixth time the seventh time the eighth time why
Speaker 474
2:33:26
so we when I first came into the office it was everything was manually on paper we have since hired a CPA two years ago she gets we started using their software um two years ago and the um the um the auditor that we had this year she said most of it is clerical errors coding it's that's what we're running into the problem now it's the coding because we're using um everything is under one category and we just go in there and we kick
for the accounts that we're using for four five accounts that we're using so it's a lot of it is the coding so um i did speak with the our our ck that we're using and she's going to um adjust it to where each account has its own code so we won't be jumping from category to category so that is where it's more it's more of a coding error that we're having now okay well i'm glad that we do have a new
Senator Alan Clark
Unverified
2:34:22
software everything is through i appreciate that that you're saying you're fixing
and that I hope not to see you here
Speaker 427
2:34:33
next year. Thank you. Yes. Without objection, we will
Speaker 21
2:34:37
file this report. Thank you. Thank you for your time. Continuing on page 35 with the City of Madison,
Speaker 11
2:34:44
2024, under the Mayor and Reporter Treasurer. Although Schedule 1 of this report shows a general fund balance of over $132,000, it was brought to our attention that as of December 31st, 2024,
The general fund owed a significant amount of balances owed to the street and sanitation funds. As shown in Note 6 on Schedule 3, when these outstanding amounts are considered, the general fund had a deficit fund balance of $235,000. It's a repeat fine in the previous five years. We have Mayor Roy Winford here today.
Speaker 328
2:35:22
Staff would note that they are current on their payment plan for their street payback.
Mayor, if you would, state your name for the
record, please. Roy Winfrey, Mayor of Madison. Do you have an opening statement? No, I do not. Does any members have
Senator Alan Clark
Unverified
2:35:41
questions of the mayor? Senator Clark? Mayor, appreciate you being here. Appreciate that y'all are current. How long have you been, Mayor? Since
23. January 23. Since 23. Why would we have as I asked the last folks, why would we have something out of compliance five times in a row?
Speaker 483
2:35:59
Well, the only thing that I can tell you is all this happened before my watch and we're trying to fix it now But it happened before I became mayor and are we just trying to fix
Senator Alan Clark
Unverified
2:36:11
what was out there? I can appreciate that but it's they have found this at least a couple of times since you've been mayor How are we going to get it
Speaker 483
2:36:20
fixed? Well, that's one thing that we are doing now. We made a lump sum payment to the street department and we are paying them monthly
For I believe is next six years that we are paying them monthly $350 a month and what is your population? 769
Senator Alan Clark
Unverified
2:36:41
okay, I I hope not to see you here next year. I'm going to tell you after 14 years, I'm going to repeat again. I'm really tired of seeing these that go over two years. Two years is too long. But I appreciate you trying to get it corrected. Representative Dalby.
Representative Carol Dalby
Unverified
2:37:01
Thank you, Mr. Chair. Mr. Mayor, can you tell me why your general fund continues to run? What's causing the deficit? two hundred and thirty five thousand dollars in the hole right now the only thing that I
Speaker 483
2:37:14
can tell you is they were deposited their previous administration was depositing money in that account and spending it for whatever I can't tell you what they spend it on like I said that was before my time I can't tell you what they're spending on but that's that's what caused the deficit if there's
Speaker 432
2:37:37
no more questions without objection we will file this
Speaker 11
2:37:44
report pages 36 and 37 we have the town of st. Joe for 24 23 and 22 we
Speaker 21
2:37:51
had originally had them on the list to start the 60-day clock also they were going to be on the list to have to pay back their street fund money but they they have on may 26th the 26th they paid the street back in
Speaker 25
2:38:10
full so that finding i'm not going to read it but they owed them about twenty thousand five hundred dollars and they made good on
Speaker 10
2:38:20
that as soon as we pointed it out to them um i'll go ahead and read the finding
Speaker 11
2:38:25
account procedures counting procedures for municipalities are set forth in municipal County Law, Arkansas Code 1459-101-119. The town was in noncompliance with these codes as
Speaker 10
2:38:34
noted below. Monthly bank statements were not prepared. Pre-numbered receipts were not issued for all funds received and deposits were not made
timely. Cash receipts and disbursement journals were not established. Annual financial statements were not prepared and posted. Invoice and supporting documentation were not provided for tested disbursements, totaling Over $1,400 or 92%,
Speaker 11
2:38:57
over $360 or 92%, and over $800 or 100% in 24, 23, and 22, respectively. However, disbursements were to vendors that appeared to
Speaker 10
2:39:08
be for the gentleman's business purposes.
Electronic disbursements were made from the general fund without proper approval of the council or without establishing written policies and procedures to ensure the electronic fund payment systems provided the internal accounting controls and documentation of accounts and accounting purposes. Monthly financial reports were not provided to the town council. Town council minutes for all council meetings was not maintained for inspection. This is a repeat finding the previous two years.
Speaker 11
2:39:43
City of St. Joe has not had a record of treasure since July of 2024. The mayor had been running the city up until his passing in April of 2026. As
Speaker 405
2:39:58
far as the street fund money that was owed, the city council stepped forward and paid that off. This is somewhat similar to
Speaker 11
2:40:12
Fargo. You know, the law allows them to reassign accounting procedures if they're in noncompliance.
They don't have a recorder, treasurer, or a mayor. So staff recommend that we defer this until August to see if city council can find some officials. But far ago, y'all went ahead and started it, so whatever the will of the committee is. We can start the 60-day clock, or we can defer it to August. What is the will
of the committee? Mr. Senator Johnson, you're recognized. Thank you, sir. Mr. Archer, I
Senator Mark Johnson
Unverified
2:40:48
understand that there's a small enough town that, you know, there's nobody.
I won't say they're asleep at the switch. They've passed away on the switch. There's nobody. The lights are on, but nobody's home. But they sit in, you know, I don't know what we do in a situation like this because, you know, we have mayors come in and say that happened in the previous administration. It makes perfect sense. I understand that. But when you say somebody else shows up, but they're going to say, I just got here. I don't even know what do we do in a case like that. What are our options, I guess, is the best thing.
Speaker 29
2:41:24
In a new administration, that would, in my opinion, would qualify as reassigning the accounting duties to someone
Speaker 27
2:41:30
else. And that's the option to just let it kick on a year and give them an opportunity. And that's
Senator Mark Johnson
Unverified
2:41:36
what the council was, I assume, trying to do. Well,
Speaker 11
2:41:39
they at least paid off the street debt. Now, in the process, that payment left about $500 in general fund. They paid everything in general fund over
Speaker 100
2:41:48
the street just to get that. So they made it good, and now they're both almost broke. Yes, sir.
Senator Mark Johnson
Unverified
2:41:54
Yes, sir. Okay. Well, some things just don't have an easy answer, do they? Thank you, sir. Thank
Representative Carol Dalby
Unverified
2:42:02
you, Mr. Representative Dalby. I move that we treat this case as we have the previous,
I think there were two others that we have done this that we will start that 60-day clock if we're not satisfied with the answers that we get in August. I mean, September. That's the date we
Speaker 11
2:42:22
had, September, correct? Yes. That was on the two that were delinquent on those street fund payments, the 60-day clock.
We could defer that until August and then start it in
Speaker 493
2:42:32
September. You want to defer the report
Representative Carol Dalby
Unverified
2:42:35
until August? Yes, let's defer it and, I mean, to no fault of their own, have the mayor guide and all of that. Let's see if we can get them here
in August. And then if we don't have any response,
Speaker 432
2:42:50
then let's start that. Before you make your motion, let me recognize Senator Irwin. Thank
Senator Missy Irvin
Unverified
2:42:57
you, Mr. Chair. And, yes, Representative Dalby, this is in my district.
St. Joe is a very, very small little community. Had a great mayor that was there for a long, long time who passed away. And so you just really probably shouldn't be incorporated as a city anymore, to be frank with you. There's a school there and a school district, but just understandable why that's probably happened. And my question, I think, too, though, is is there a way that we can, I guess, look at the process or make a recommendation that perhaps they unincorporate?
Is that ever been done by legislative council audit? And I think, I don't know if audit's done that, but that or speaking with the county administration about that, it's kind of my recommendation just because very small, great school there, but community has kind of faltered just because they relied on this man who was the mayor for so long, had do everything.
Representative Carol Dalby
Unverified
2:43:59
Well, and I think before you walked in, Senator, Mr. Archer was telling us that the city
council has taken some steps to try to get things in line.
And so my motion was, we can start that clock to de-charter them or whatever we call it, but we were going to hold that off until our August meeting so that if the city council, because they have made some good faith effort, and we try to recognize that in this committee when they make some good faith effort, that we would give them to August. And if they can't get things, you know, kind of in line and started at
Speaker 494
2:44:38
that, then the time frame starts is what my motion is.
Speaker 432
2:44:50
All right. Do we have a second on the motion? Second. Any discussion on the motion?
Speaker 21
2:44:59
All in favor say aye. Aye. Any opposed? The
Speaker 11
2:45:01
motion passes. Continuing on page 38, with the City of Wilmot, 2024, under the Mayor, an annual audit of the grade problem procedure report has not been completed or submitted to Arkansas-Leslieve Audit for the City's water and sewer system for the years 2017 through 2024, as required of Arkansas code.
The City signed an engagement letter on February 1st, 2026, for the years 22 through 25. The next sentence says they hadn't received it, but actually they filed their reports on
Speaker 25
2:45:33
Tuesday, June 2nd. So we reinstated their turn back. They should be getting their money on June 10th. So they're in good standing there. Continuing under the mayor, although Schedule 1 of this report shows a cash balance
Speaker 11
2:45:48
of $90 in the general fund,
was brought to our attention that as of December 31st of 2024, the city owed a significant amount to the IRS, which has not been paid as of the report date. As shown in Note 5 on Schedule 3 of this report, when this outstanding amount was considered, the general fund had a deficit fund balance of over $51,000 as December 31st of 2024. This is a repeat finding. I believe Mayor Carolyn Harris is here to answer questions.
Speaker 432
2:46:20
if you yeah there you go if you would state
Speaker 500
2:46:38
your name for the record please Mayor Carolyn Harris and I have with me Evelyn Woods she's our receivable clerk
Speaker 501
2:46:47
in acting tentatively treasurer treasurer no recorder recorder not treasurer do you
Speaker 502
2:46:54
have an open statement mayor ah yes first thank you guys for this opportunity of coming here today just know that over the past and I will be say I've been in office for this is my 11th year no 12th year 12th year ending November and when I came into office that was my first time coming before you guys my first year in office because of things in the past what we we made a lot
of progress we correct a lot of things that were not done properly in the past so over the last few years we have had staff turnover and well you know what I'm going to go on into all of that because I am the mayor so I'm going to take ownership in anything that's on this list. So what we're doing currently because I don't
Speaker 503
2:47:47
want to go back and say this person and those individuals didn't do a certain procedure so for moving forward we put a lot of
Speaker 502
2:47:56
policies into place we have also some controls we have looking into a lot of ways in which we can Generate revenue in areas which we probably should have already been receiving revenue business permits Franchise fees just to increase our revenue. I personally haven't taken the $15,000 pay cut because I am
Speaker 503
2:48:17
trying to get the city in a place Financially so that we can sustain we can sustain our services to the citizens
Speaker 502
2:48:29
Ms. Woods agreed to come on and take on some of the recorder duties until We can get a recording and that will do both treasure and recorder duties. I each year I actively Seek out in the community Citizens that would come on become
Speaker 503
2:48:45
a treasure recorder. Let's it's you know for the city so that we can Get everything into place this
Speaker 502
2:48:53
year. I have found someone who's a retired teacher. She's willing to step up she moved on to Arkansas from Colorado so she's willing to step up and be a
part and serve in that role as Treasury quarter if she's elected I'll say that so the only thing I can say we are trying to get in compliance of the statues we've turned in audits and we're going to continue to work in other areas in which
Speaker 500
2:49:19
we need to make improvement. Are there any questions about
Speaker 432
2:49:24
from the members. Representative Wright. Thank you Senator Stone. Let
Representative Johnny Rye
Unverified
2:49:29
me ask this ladies, that money that is owed to the Internal Revenue Service, how do y'all stand on
Speaker 502
2:49:37
that now? Have you got that paid back? No it hasn't been
Speaker 503
2:49:43
paid back. We are working with them. I've sent requests in, actual letters in and we're just working to get that payment
Senator Alan Clark
Unverified
2:49:50
arrangement set up. Senator Clark did you have a question? Thank you Mr. Chair. Thank y'all for being here.
The and thank you for taking ownership of the problems. Yeah. What's the population
Speaker 508
2:50:03
of Wilmot? Wilmot is 418. Okay. The you
Senator Alan Clark
Unverified
2:50:09
have a deficit balance or had a deficit balance of $51,632.
Has that change depreciably? It has we have as
Speaker 502
2:50:22
have increased some of our rates so our water rates sewer rates and so forth we have done that which will help
Speaker 503
2:50:32
us generate additional revenue to cover other expenses. Okay well you had
Senator Alan Clark
Unverified
2:50:41
to do that I'm assuming because we we passed a law that said you couldn't sell water so water below cost and had to have an audit done and figure out so so that has been a problem for communities across the state is that we're selling water below what it actually cost us to produce it but have you paid anything back on the IRS? No that's that's I
Speaker 503
2:51:04
stated earlier we are working on that I sent in a letter requesting a payment arrangements and so forth so that it's
Senator Alan Clark
Unverified
2:51:11
in the works. The and so and I've
kind of had this tone throughout why you've got this debt looming over you that I don't see how you're going to pay. Why do you want to be
Speaker 512
2:51:29
a town? Why do we want to be a town?
Senator Alan Clark
Unverified
2:51:32
If it appears that it could be costing more than you can
Speaker 502
2:51:38
take in. I can say this I moved back to Arkansas in 2010
I grew up there and moved away for 23 years back I was there I
Speaker 503
2:51:50
had a small business and it did not make it so I decided if I'm gonna continue to be in this community I want to step up and do whatever I can to help this community grow. Since I've been in office we receive over two three million dollars or more in grants in different areas, police department, fire department, streets, all our departments actually sewer, water, so we receive grants but
unfortunately we had to take loans with them as well because they're not a lot of 100% grants. We are currently working on the strategic plan and we're working with the University of Memphis so that we can see different ways of bringing revenue into our community. Through our Lake Enterprise we're gonna focus on tourism and trying to draw in revenue based upon the tourism and we have a lot of visitors to Lake Enterprise because we're on the border of Louisiana. Southeast
Arkansas so we're on the border so we have a lot of visitors that visit our Lake constantly so we're trying to to be think of creative ways for a small community in which we can generate revenue just to keep us afloat. We would love to have more assistance from the state if I want to be honest with you we apply for the community needs grants. No municipalities receive that grant. Prosecutors offers and nonprofits receive that grant and I say that because
I'm a go-getter when it comes to the community because I want us to thrive. I grew up there. I love where we live. There are opportunities, but we also need assistance. Governor
Speaker 501
2:53:33
Hutchins, I remember going before him, and I said that I feel like we're forgotten in southeast Arkansas. So, and
Senator Alan Clark
Unverified
2:53:49
and again when I ask that question, it's not an insult
It's a real question and I'm and it's not just for y'all. It's for every small town that's having a problem Paying their bills and especially those with a deficit balance Why do we want to continue this because the things that you've mentioned we can do as a community. I have communities much larger That are not incorporated That can do all the things that that you mentioned and so it's time for us to consider Whether we're going to continue to be incorporated
And can we handle those responsibilities or not and but I do I appreciate you take the pay cut I appreciate you taking ownership. I appreciate you being here But it's time that we as the legislature not just you ask these serious questions. Thank you Also
Speaker 502
2:54:37
may I address that and I'm not here to be combative because that's not what this is about. I promise you but I'm here for a reality check. We put a lot of resources
Speaker 503
2:54:47
in Northern Arkansas. Don't forget the small towns and I'm here to speak for them because I'm a small town
and I love where I live and I want the state to look at the whole, I mean, you guys look at the whole state. What can we bring to Southeast Arkansas that can create jobs so that we can have livable wages for our citizens in the surrounding communities, not just Wilmot. There are several small communities in southeast Arkansas. Where are the jobs that are coming southeast for livable wages? I said livable wages. I'm not talking about $11 an hour. Livable wages so that we can create businesses. Like I
told you, I had a business. I chose to get out because when I moved here I had a son in college. So you decide how can I do this? I can't do this. You know but we do not want to be forgotten and say oh well these smaller towns can't do it. We can do it with assistance. Turn back we receive in general fund from the state $500 a month. $500 because you base it on our population. Maybe we
should base it on our needs and not just the population. So I'm here and I get emotional and I'm sorry because I do not want us to be forgotten. I don't want us to be oh I've heard it all day. Well a hundred populations what about just ending it but what about the people who live there and who want better but we need assistance sometimes not all the time to
do better. I don't believe in handouts that at all but we do need for you guys to consider ways some creative ways in which we can help these smaller communities who are really trying. It was hard for me to go to the citizens to raise our rates and we did that. We haven't received our rate study yet. We did that because it has to be done. Someone's working on our rank
Speaker 501
2:57:00
study for about the last year. We moved on and made our own decision. We got to do something
to stop the bleed so we can turn things around. So I'm asking you not to be the
Speaker 503
2:57:12
focus of shutting these small communities down. It's just should the focus should be how can we help these communities. It's just like we pour in so many tax dollars and tax credits to bring people and businesses into northern Arkansas. That's my
Speaker 501
2:57:29
spill on it and I'm not here to be combative I promise you. It's just that just be more open because not everyone is not trying to
not be in compliance or intentionally not being in compliance. There's a lot of things that occur in Wilmot that's not more so city business but other things that have occurred that affect city business when it
Speaker 503
2:57:57
comes to individuals trying to do the work and they come to a point where it's like I have to take a break
Speaker 501
2:58:07
because this is overwhelming but not giving up so we ask the state to don't give up on their small communities
because I'm going to fight for mine well I mean we're not going to give up on anybody but communities have to do what they have to
Speaker 432
2:58:22
do because sometimes if you don't take care of your business somebody will take care of it for you and that's why you're at the end of the table today and that's what we're trying to do can I respond Mr. Chair before I yes and then I've got Representative Rice, Senator Wallace, and then Senator Johnson and we kind of need to be moving forward please so let's be candid on our answers and very candid on our responses. Mayor I very appreciate very much appreciate
Senator Alan Clark
Unverified
2:58:47
everything that you have to say I represent a rural district which suits this country boy very well Malvern being the biggest town in it and the municipal leagues here they know I have towns with the population of 117 I'm not And I'm not saying that anybody's not trying, I'm just asking the question, should we be incorporated? It's not, but I can assure you here in this legislature that those of us who represent small towns are fighting for small towns
and are fighting to bring jobs and whatever economic development that we can find. And that's part of why we did the things we did on water, because I've asked, which comes first, the chicken or the egg? If we don't have infrastructure, how are we going to get business there? So I appreciate the things that you're up against. As the agricultural economy has shrunk, what used to be the prosperous part of Arkansas is no longer prosperous. We're very much aware when it comes to health care and other things. But whether a government body can pay, you know, here we have in the Constitution
that we have to have a balanced budget. And so it's not whether we want to help or not, it's whether we ought to be a town or not. And like I said, whether the connotation of what I'm saying can be misrepresented or misunderstood. I wasn't harder on small towns than I was on the Pulaski County people. If Fort Smith had been here, we already turned that over to a prosecutor, I'd have been hard on Fort Smith because they had some things on there that I didn't understand why in the world they didn't know.
Why they didn't know they couldn't just give $30,000 to somebody. I was on the quorum court 30 years ago, and we had to have a contract. So we have to do business as business, and so I
appreciate you caring for your community, and so do we. Thank you, Mr. Chair.
Representative Johnny Rye
Unverified
3:00:49
Representative Bryan. Thank you, Mr. Chairman. Ma'am, let me ask you ladies this, this $51,632, that's a deficit, did you, ladies, did you change the amount that you were
charging for water bills so it would actually generate more revenue and that way you didn't have to spend as much money out of the general fund?
Speaker 506
3:01:12
exactly we've increased our water rates there was
Speaker 503
3:01:16
pay cuts actually we decreased our staff well during the summer we kind of hire additional staff to help keep up with the street maintenance and so forth so we did decrease that so we have full time two full times and we have a seasonal individual now that just comes in to assist so we're making different adjustments and changes in our budget so that we would not fall in that area
again of having a deficit and we're working diligently on our IRS. Thank you ma'am. And as of 2026 was our current. All right Senator Wallace you're recognized for a question. Thank you
Senator Dave Wallace
Unverified
3:02:00
Mr. Chair. Ma'am thank you for being here today. You said earlier that you had taken a pay
cut? Yes. And how much was that? $15,000. $15,000? Okay. $15,000. $15,000. Yes, ma'am.
Speaker 279
3:02:20
Thank you. Are there any other questions? Senator Johnson. Thank you,
Senator Mark Johnson
Unverified
3:02:24
Mr. Chairman. Mayor, thank you for your candor and for working hard on this. As Senator Clark said, I'm very
interested in the the rural problems and we do have a disconnect here you see parts of our state that are just rolling money
and others that are are just barely making ends meet there and that's not your fault you just you're helping your community that you grew up in I I was born in Ashley County I have family down there and I understand and I recently lost a family member and went
the funeral and as I drove through Crossett I was really stunned by how Crossett has kind of gone down but that's a systemic problem but if if your means reduce you have to live within your means as and Senator Clark was making that clear. The gentleman behind you on to your right is my friend Senator Critcher with the Municipal League and he has resources that could help you but I think you are it's beautiful that you're wanting to grow out
of your problem but you're gonna have to manage your way out of this particular one and I encourage you to to pull your horns in while you're seeking these other sources of revenue
another industry because you know it's the old saying in your family you know we'd like to have steak every night but we're
gonna have to eat beans for a while until we we get things together but but thank you for coming and for we're gonna do everything we can not just to help Wilmot but all that I worry about the Delta all rural Arkansas but especially the Delta you
have some unique problems and even though I don't represent that area I'm in Central Arkansas I have family and friends down there and I
think it's important that our whole states does well so thank you for coming thank you Mr. Chair and I
Speaker 503
3:04:19
do want to address the management we are working diligently on that as well you know as far as how we manage our finances and putting processes in place to make sure certain things are being done as they should and to be in compliance of the federal and stat and state laws. Are there any other
Speaker 432
3:04:41
questions? Saying none without objection we will file this report. Thank you.
Speaker 17
3:04:48
Ladies thank you. Continue on page 38 with
Speaker 11
3:04:52
the 11th Judicial District East 2024. The restitution account had an unidentified bank balance of over $2,000 on December 31st, 2024. This is a repeat finding. The circuit court fine collection account had an unidentified bank balance of $33,000 at 12-31-2024. This is a repeat finding in the previous seven reports
Speaker 10
3:05:14
Stating back to 2015, we have prosecuting attorney Tim Blair here today to answer questions.
Speaker 432
3:05:25
why that money is there. Mr., would you state your
Speaker 529
3:05:29
name for the record before you start, please? I'm sorry. No worries. Tim Blair, I'm the prosecuting attorney for Arkansas County, which is the 11th East Judicial District. Thank you. Please proceed. Yes, sir. So back around the beginning of 2000, our county clerk, excuse me, our circuit clerk decided that they did not want to collect fines and fees anymore, fines, fees and restitution.
At that point, and this is prior to my administration, at that point, the prosecutor decided that instead of letting that go to a debt collector, because if it went to a debt collector, they would take 30% of everything, not just fines and fees, but also restitution. And so somewhere in the early 2000s, our office, prosecutor's office, took over, taking fines and fees and restitution. So all the money that we're talking about is restitution that has been collected.
All fines and fees have been passed on as they're supposed to be passed on. Well, that went on with hand bookkeeping until around 2015. In 2015, it went to QuickBooks. Well, when they did the transition, there was a fair amount of money, not a fair amount, a large amount of money that you either weren't able to identify who that money went to or you weren't able to find who that money went to.
So if you collected, and this is an example, if you collected something to a business in 2015 or 2010 and that business went out of business before the money was collected then you don't have any you don't have an easy place to send it to and so that's kind of the situation we've been in of that money you know there's two accounts there the restitution account and the amount that is shown there is the two thousand inch change well that account actually
has $20,000 in it. We know who 18,000 of that money belongs to, but we don't know who that 2,000 belongs to. In the $33,000 in the circuit court collection account, that's about 75% of that money is from the money that comes prior to 2015, which was collected, and we We don't have a place to send it, you know, the place, the restitution going to a business that no longer exists or somebody that's passed away, something to that effect.
And so we try to go through once a year and look and see if we can find, you know, somebody who that money can be sent to. But, you know, we're stuck with what we have. Now, that other 20 percent on the rest on the circuit clerk amount or the circuit clerk collection amount, that other 20 percent, which is, you know, you'll send out a check to somebody who has whose old restitution and they won't cash it or something to that effect.
And so we're in the process of always trying to reissue that money. This isn't money that is we haven't misused. This is just money. We haven't been able to distribute Representative
Representative Carol Dalby
Unverified
3:08:59
Dalby Appreciate you sitting through and being here this afternoon. It is my understanding that orders can be issued Directing that money kind of wiping out that account at some point in time and I'm assuming that that y'all will pursue that
I know that the AOC can help in that regard and I'm sure the prosecuting attorney's office can help in that regard but that's my understanding that at some point in time court can issue an order they can't find them and move on
Speaker 529
3:09:27
they can issue an order sending that money to County General but once that's done that's the end of
Representative Carol Dalby
Unverified
3:09:34
it but at some point you may have to draw that line and I would suggest that you get with those two entities to prepare for that at
Speaker 432
3:09:46
some point anyway if there's no other questions without objection we will file the report
Speaker 21
3:09:50
thank you mr. mayor thank you on page 39 we have one report that we have a finding
Speaker 11
3:10:01
on and no response that is the highway 424 water association for july 31st 2025 this is a private report staff recommends we defer this report until which time we get
Speaker 16
3:10:13
an adequate response Without objection, we would defer
Speaker 11
3:10:16
this report. On pages 39 through 52, we have 36 reports with resolved findings.
Speaker 27
3:10:22
Staff recommend we take a minute to review those, and if there are no questions, staff
Speaker 432
3:10:32
recommends that we file these reports. We have a motion to file. Do we have a second? Second. Any discussion on the motion? All in favor, say aye. Aye. Any opposed? Say
Speaker 14
3:10:46
nay. Ayes have it. The motion carries. Without objection, we will
Speaker 11
3:10:50
file this report. On pages 53 through 57, we have 155 reports with no findings.
Speaker 432
3:10:55
Staff recommends that we file these reports. Without objection, we will file these reports. Well, I think that concludes the meeting for the day. The next meeting will be August 13th,
2026. Until then, y'all be safe. Meeting is adjourned. Thank you.
Agenda
A. Call to Order by Chair
Prayer
B. Adoption of Minutes of March 12, 2026, meeting
C. Update on Private Reports – Delinquent December 31, 2022, Water and Sewer Reports
D. Update on Private Reports – Delinquent December 31, 2023, Water and Sewer Reports
E. Discussion of Noncompliance with Municipal Accounting Law - Denning, Fargo, Gum Springs, Lead Hill and Ulm
F. Discussion of Noncompliance will A.C.A. § 27-70-207 Misuse of Street Funds – Jericho and Haynes
G. Review of Reports (Refer to the Synopsis)
H. The next meeting of the Legislative Joint Auditing Committee will be held on August 13, 2026.
I. Adjournment
Documents
No documents posted.
Speakers
Speaker 432
Speaker 8
Speaker 10
Speaker 11
Speaker 14
Speaker 21
Speaker 23
Speaker 25
Speaker 27
Representative Carol Dalby
Unverified
Speaker 35
Speaker 36
Senator Matt Stone Chair
Unverified
Senator Mark Johnson
Unverified
Speaker 26
Speaker 29
Speaker 50
Speaker 58
Speaker 22
Speaker 64
Speaker 67
Speaker 71
Speaker 81
Speaker 84
Speaker 87
Speaker 85
Speaker 83
Speaker 99
Speaker 101
Senator Ben Gilmore
Unverified
Speaker 144
Speaker 114
Speaker 159
Speaker 157
Senator Reginald Murdock
Unverified
Speaker 166
Speaker 174
Senator Kim Hammer
Unverified
Senator Steve Crowell
Unverified
Speaker 182
Senator Alan Clark
Unverified
Speaker 208
Speaker 38
Speaker 97
Speaker 228
Speaker 234
Speaker 238
Speaker 239
Representative Johnny Rye
Unverified
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Senator Dave Wallace
Unverified
Speaker 290
Representative Cameron Cooper
Unverified
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Mayor Bruce
Unverified
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Senator Missy Irvin
Unverified
Speaker 494
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