June 22, 2012 in City

Center audit raises questions

State officials notify prosecutor after check of East Central books
By The Spokesman-Review
 

An audit of the East Central Community Center was referred to county prosecutors this week after state officials found problems with the way the center’s staff kept its books and ignored city policies.

But state auditors said they couldn’t determine whether the city actually lost money that was given to the community center “due to a lack of internal controls, missing records and the co-mingling of (East Central) Wellness Association and Community Center financial activities.”

The state auditor’s office was called in last year after questions surfaced about potential overpayments to staff shared by the community center, the association and its other nonprofit arm, the East Central Community Organization. The center’s longtime director, Diane Jackson, and an employee, Sonya Ellis, resigned at the request of then-Mayor Mary Verner.

Jackson and Ellis were employees of the city and the nonprofits that supported community center programs, auditors said. Some programs had formal contracts but others didn’t have contracts that spelled out revenue and cost-sharing. City employees aren’t allowed to have a financial interest in any city contract or transaction, they added.

“The executive director’s violation of contract terms and city policy put public funds at risk,” auditors said in their report. Some money that shows up on city receipts was deposited with the wellness association, and nearly $9,000 that was recorded on city receipts was not deposited with either the city or the association.

Whether that should result in charges, however, is up to county prosecutors, Mindy Chambers, a spokeswoman for the auditor’s office, said. “We don’t even weigh in on that. Anytime we have a misappropriation of funds, we refer it to the prosecutor’s office.”

The community center gets some money for its programs from the federal government, and the problems revealed in this special audit could put that money at risk. But the same state auditors are looking at how the city stacks up on federal requirements, and will report any problems in that larger audit, which is expected to be completed this September.

Pam Dolan, city accounting director, said the audit points out a “weakness in accounting activities.” Although having these problems show up in a special audit “is not a positive,” Dolan said, they may not have a direct correlation to the federal requirements.

The city has since changed some of its procedures and is following up on specific recommendations in the auditor’s report, city spokeswoman Marlene Feist said.

The city is also looking at converting the East Central Community Center, which is currently city-owned, to a nonprofit organization like the West Central and Northeast community centers.


There are three comments on this story. Click here to view comments >>

Get stories like this in a free daily email