Last week Missouri State Auditor Susan Montee delivered a stinging part two of an audit of the Northeast Ambulance and Fire Protection District, which was required when auditors were locked out of district headquarters and the audit process became ensnared in lawsuits.
"We kept trying to get enough to finish up the audit. When we finally had to file suit, they had us locked out of the building. And they wouldn't give us our stuff. We had to call the police," Montee told The American.
As the legal coasts cleared to some extent and new district administrators assumed control, auditors were able to complete their tasks. "Our auditors were treated very well," Montee said, of working with the new district board majority and Fire Chief Angelia Elgin.
Part two of the audit does report on some of Elgin's tenure, and it finds some problems. Montee's style as an auditor is to report on flaws where found without assigning personal blame by name, but she went beyond leaving Elgin out of it. As someone who observed intimately the mess the new chief found when she came onboard, Montee counseled against drawing conclusions about Chief Elgin from the report released last week. With regards to the "letter of no confidence" a group of firefighters, led by the Local 2665 union members, presented to the district's board two months after Elgin became chief, Montee said, "She didn't even have a chance."
"I would never pass any judgment on anyone who had to come into that environment and make changes," Montee said of Elgin.
"There are changes being made. I would never make any judgment based on the first few things that have to happen, because you're in a position where not only do you have to help make hard decisions and implement them, but you're walking a real tightrope with a brand new board that isn't quite sure what is going on either. It's a difficult thing to walk into."
What did Elgin walk into?
The Northeast fire district in Normandy basically had no financial ledger or bookkeeping system when Montee began auditing the district - the first time - in 2008, Montee said. As finances were traced, a desperate picture emerged.
The audit report shows a sharp decline in the district's finances over the past two years, with cash balances decreasing by $2.3 million (54 percent) from June 30, 2008 through June 30, 2010.
Montee points to increased excessive spending as the cause. From July 2008 through October 2009, the prior board approved such things as an administration building ($512,000), ambulances ($367,500) and attorney fees ($335,479). Yet salaries represented the largest expense, increasing by $965,286, or 28 percent, from calendar year 2007 to 2009.
On March 4, 2010 the current administration of the district contracted an accounting firm to clean up the district's books, and it now has an operating budget. But accountants have not yet been able to rebuild the books of previous years, which will solve other questions about fund allocations, Montee said.
With appointed board members and Chief Elgin taking over the district in November 2009, Montee focused most of her comments on the current board's practices.
First, she said the district currently allows employees to use sick leave excessively. As of July 2010, three employees had used more sick leave than is allowed.
One employee had a negative balance of 610 hours, which equals approximately $13,036. According to the audit report, in January 2010, this employee entered into a verbal agreement with the board to take unearned leave in the following months and then pay $125 to the district each pay period to repay the unearned leave. However, as of July 2010, no payments have been deducted from her paycheck, nor have arrangements been made to withhold payments from her check, the report states.
"This agreement appears to be a loan from the district to the employee and as such could be in violation of the Missouri Constitution," the report states.
At every board meeting, the board approves bills for payment, but their list does not include electronic payments and payroll disbursements, Montee said. This allows errors to easily fly under the radar.
Showing some Love
The report states that in May 2010, Linda Love-Tolbert, the human resource specialist/administrative assistant, had her pay rate decreased from $29 per hour to $19.25 per hour. On the June 18, 2010 and July 2, 2010 pay periods, her pay rate increased from $19.25 to $30.50 per hour. During these pay periods she also incurred overtime, and her overtime rate increased from $28.87 to $45.75 per hour, the report states.
This increased her gross paycheck by $1,237 per pay period for a total overpayment of $2,475. After the July 2, 2010, pay period her pay rate was reduced to the correct rate.
"When we brought this to the Fire Chief's attention, she indicated she was unaware of the pay increase for these two pay periods, and after discussion with the Fire District Analyst, stated this was an error," the report states. "The Fire Chief indicated the decrease in the employee's rate must not have been saved to the payroll system."
Elgin told the American that everyone took a pay cut, from the chief on down. Once the auditor pointed out the inconsistency, the problem was corrected that day, she said.
Montee also said that some practices regarding the district's legal services have not changed from previous administration. In a previous audit, Montee said she recommended that the district solicit proposals for legal services, though it is not required by state law.
And it does not seem that the district is looking at the most economical avenue for legal counsel, Montee said.
"From March 2009 through November 2009, the district paid $188,386 to the former legal officers," the report states.
"In December 2009, the district hired a new legal officer and a special legal counsel with annual retainers of $60,000 and $12,000 per year, respectively. The annual retainer appears to cover all legal services except litigation. For litigation, the legal officer and special legal counsel receive $225 and $200 per hour, respectively, in addition to the monthly retainer. From December 2009 through June 2010, the district paid a total of approximately $78,800 to the new legal officers. The Board President indicated the district's attorney has waived the retainer fee and simply charges per hour worked."
However, Montee also had a problem with language in the attorney contracts, mainly regarding the retainer fees.
"The new contracts require the district to pay the remaining balances of the annual retainers through the end of the contract, April 30, 2011, if the district terminates the contracts for any reason other than those stated in the contracts," the report states.
"The contracts also require the district to pay the remainder of the monthly retainer for the month terminated. The new legal officer's contract requires an additional $5,000 as compensation for severance if the district terminates the contract for reasons stated in the contract."
Margaritas and Montee
Montee is on the Nov. 2 ballot, facing a strong challenge from Republican Tom Schweich. Schweich has been endorsed by Missouri's best-known far-right winger John Ashcroft and the National Rifle Association.
Speaking of the NRA, the Schweich campaign may have thought Montee had been felled when video of Montee that had been shot covertly by a Republican operative surfaced last week. The video shows Montee socializing at a Democratic Party social function. She is outgoing and friendly to the other guests while expressing her satisfaction with the margarita she is drinking.
The EYE has watched this video and come to some definite conclusions about Montee based on it. Without a doubt, it proves that she has a couple of drinks when she goes to parties and is outgoing and friendly to her fellow party guests. Last time we reviewed the qualifications for the position, this behavior is entirely consistent with being a fair and able auditor - as Montee has been. It also is entirely consistent with being a very fun and pleasant party guest. Let's drink to that.