This series of post will be dedicated to the Indiana State Board of Accounts Most Recent Audit filed September 30th, 2010 for the fiscal year ending December 31st, 2009. The State Board of Accounts is
not an enforcement agency. Their role is to audit agencies. Enforcement is either through the county's elected prosecutor, Indiana Attorney General, or in most cases the Federal Prosecutor. Here is a link to the this report: [url]http://www.in.gov/sboa/WebReports/B37601.pdf
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As Mayor Thomas McDermott Jr has refused to publish the CTARS and instead posted the marginal information he has on gohammond.com. This series of post is to help those who might want to learn more about how Hammond handle's its money under the McDermott Administration.
Eventuall I hope to have all the Audits reviewed in this thread since Hammond's Mayor Thomas McDermott Jr has taken office.
The real problem is where to start.
The current city budget is burried/hidden. Some argue that portions of Hammond's general operating fund operating cost are found in the Sanitary & Water Department Budgets which give the appearance the general fund budget has been decreased. So someone could claim they cut $600,000 of the budget but by placing line item cost in the S & W budget (which is user fee based) they can hide items that should be in the general budget and claim a budget cut.
An example is McDermott's Chief of Staff and administrative assistants are paid by the Hammond Sanitation & Water Departments. The estimated salaries and related health, fica cost are approximately $150,000 (or more). So McDermott claims a $600,000 general fund savings, but $150,000 of what should be general fund cost are now paid monthly by user fees through your water and trash services, billed monthly.
The Indiana State Auditors cited the city for not publishing the Water & Sanitation Department Budget. Now why would a government entity not publish a Budget? Why do you think?
I don't think failing to publishing the budget as required by law was just an oversite.
The State Auditor wrote on page 77 in the Summary of Results: [b]"material weakness" and "significant deficiencies" in this Hammond City Audit. The State Auditor found: "Auditee qualified as low-risk auditee? no"For the material directly below you can follow the link to the specific report:
http://www.in.gov/sboa/WebReports/B37601.pdf[/color] found on page 69
Quote:
ANNUAL REPORT
The Sanitary District and Water Utility, departments of the City, annual receipts, disbursements
and balances were not included in the City's required annual report; therefore, the receipts and disbursements of the Utilities were not published as required by law.IC 5-3-1-3(a) states in part: "Within sixty (60) days after the expiration of each calendar year, the fiscal officer of each civil city and town in Indiana shall publish an annual report of the receipts and expenditures of the city or town . . ."
Inquiring minds just want to know why a fiscal report was not published? Could it be that McDermott's claim to reducing propert taxes was augmented by padding the cost of the Sanitation and Water Department Budgets, ala McDermott's chief of staff and administrative secretaries being found in the unpublished budget?
What else is hidden in this budget?
Now I am not sure how you feel about this, but it clearly appears Mayor Thomas McDermott Jr and Mr. Bob Lendi misalocated federal homeless funds to pay a political cronie. Even the State Board of Accounts found a problem with it. [/b]
From the most current State Board of Accounts Report, one of Mayor Thomas McDermott Jr cronies got a $25,000 bonus from a housing fund.
Why this employee? The audit questions the legality of using unrelated funds.
found on page 86 of the report.
Quote:
FINDING 2009-5, HOME ALLOWABLE ACTIVITIES
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program: HOME Investing Partnership Program
CFDA Number: 14.239
Award Number: M-06-MC-18-0204
In 2008, the City offered an early, voluntary retirement incentive package to its employees if the
employee retired by December 31, 2008. The incentive package included awarding the employee $750
for each year of employment completed with the City. One Department of Planning and Development employee retired as of December 31, 2008, and was paid $24,750 on January 5, 2009, in accordance with the retirement package. (NOW WHY WAS ONE EMPLOYEE PAID A $24,750 BONUS FROM THIS OR ANY FUND, $24,750?)
Even though the employee's salary for 2008 was paid from the City's Redevelopment Commission Operating Fund, the $24,750 incentive benefit was paid from the City's Affordable Housing Fund
(Fund #285). The Affordable Housing Fund receipts and disburses the City's HOME Investing Partnership Grant Program. City officials provided documentation that the employee's incentive package payment would be paid from the HOME grant funds due to lack of funds in the Redevelopment budget.
The $24,750 is considered to be a question cost of the HOME Investment Partnership Program
grant since the retirement package payment was paid from HOME grant funds even though the employee
was not paid from HOME grant funds throughout the year.
24 CFR 92.504(a) states in part:
"The participating jurisdiction is responsible for managing the day to day operations of its
HOME program, ensuring that HOME funds are used in accordance with all program requirements
and written agreements, and taking appropriate action when performance problems
arise. The use of State recipients, subrecipients, or contractors does not relieve the participating
jurisdiction of this responsibility. The performance of each contractor and subrecipient
must be reviewed at least annually."
We recommended the City establish internal controls to verify the disbursements paid from grant
funds are for allowable activities of the grant.