Leachville Council voices bookkeeping inquiries

Wednesday, December 3, 2003

The Leachville City Council met on Monday evening, Nov. 24, and worked though a long agenda that consisted of the proposed 2004 budget, bookkeeping inquiries, and withholding bonuses, raises and expenditures.

Treasa Austin, city clerk, reviewed the recent city audit, completed on Nov. 6, by Don Ray CPA, and Kevin Baldridge, with the Arkansas Legislative Audit Committee.

Audit formal comments included: unable to determine cash on deposit; LOPFI transactions; one month receipts not deposited the same month; 2002 fixed assets of $6,500 had an extra 0 making it $65,000; bond and fine receipts did not match; agreement was reached for procedures for accounting practices.

"Changes have been made in the insurance pay back, with the police and firemen's pension fund (LOPFI), and it is very confusing," Austin said. "It will take a while to get it all straightened out."

Leachville Mayor Ralph Wells reviewed the 2004 budget, involving $214,500, and asked for council comments. Council members voiced different budget concerns.

"I see where you have budgeted for a police car," said alderman Rick Hamilton. "This should go through the council before buying one. There is too much in the budget like it is, without going through the council first."

"Some items are set," said Austin. "Other things are flexible. Look over the budget and see if there are things we need to change."

"I am concerned about people owing outstanding bills," said alderman Sheila Spurlock. "When city employees owe bills, shouldn't we consider payroll deduction toward paying it?"

"No," said Mayor Wells. "With two good pay increases we should start seeing that resolved soon.

"Each department could probably do with less in the budget and perhaps even less employees," Wells continued.

"We have considered setting up a purchasing department in the old revenue office," Wells said. "It will help if we can get purchase orders before purchases are made. We have talked about Marsha (Davis) acting as purchasing agent. With a requisition order, a purchase order, a receiving order, then a statement of payment could be completed. This would make for a very good record keeping system."

"All the department heads need to control their departments," said Spurlock.

"All purchases should be cleared through the department head, and then one person responsible for purchases," said Austin.

"Department heads need to answer to Ralph (Mayor Wells)," Spurlock said.

"If Marsha does purchasing and someone does not get a purchase order before buying something, then it would come out of their check," said alderman Bill Hetler.

The council passed the motion to set up a purchasing department, with a 5-1 vote. Rick Hamilton voted against the motion.

The council voted unanimously to not give raises, Christmas bonuses or consider retirement benefits for 2004, until after July 1, 2004, to see how the financial situation stands.

Mayor Wells reviewed a letter from fire chief Jessie Johnson concerning the purchase of a fire truck. The total cost was listed at $118,343, with $5,000 to be paid by ACT 833 money, $20,000 applied from sale of 1978 FMC fire truck, $2,500 from June 1, 2004 rural fee collection, leaving $46,842 remaining on truck purchase.

"Our firemen take good care of their equipment and take pride in them," Wells said. "They want to keep their fire rating and need the equipment to do so."

"Can we keep our same rating with our existing trucks?" Alderman Rick Hamilton asked. "We need to get with Jessie and find out more on this."

"Can we afford it?" said Spurlock.

"We don't need to jump the gun," said alderman Monte Grimes.

"I think we need to table this until Jessie comes and tells us more about it," said Alderman Bill Hetler.

"I have concerns over the back premium on employee insurance," said Spurlock. "The insurance was not taken out, and now employees are having half back payment taken out. The city pays the other half."

"We can pay it all at once if you want," said Austin.

"Their health insurance lapsed because payment was not made," said Spurlock. "How did that lapse? Why were we not informed? This was a very dangerous thing."

"It wasn't paid because the city did not have the money to pay it," Austin replied.

"Mayor did you know we did not have the money to pay employee insurance?" asked Spurlock.

"No, I was not informed," Wells said.

"We need to get monthly reconsiliation statements, so we know where we stand financially," said Hetler.

"Do we get reports each month from our CPA?" asked alderman Karen Wallace.

"No," said Austin.

"But you can do a reconsiliation statement, and we need to get it regularly," said Wallace.

"I asked for a statement the very first meeting I was here and never got one," said Hamilton.

"We have never done one," said Austin.

"I want to know where the money is going," said Spurlock. "Some employees have checked with the state and they show no earnings have been paid in on their taxes."

"That is an error," said Austin. "It is current."

"It is not uncommon for that to happen," said Stan Whitlow, a guest. "If they got a W-2 form, they will get credited for it."

"Our auditors are checking our books regularly," said Mayor Wells. "They are looking over our shoulders all the time."

"Before our next meeting, I want to see our checkbook, our outstanding bills, and a reconciliation form," said Spurlock. "We should not be paying all these late charges."

"We have only been late when we don't have the money to pay," said Austin.

"We were told we had an outstanding bill for the port-a-pottys, and they didn't want to bring them to our Relay for Life," said Spurlock. "It is not good for us not to pay our bills on time."

"They are getting paid, they may be late, but they are paid," said Austin.

"I don't know if it is because Treasa didn't have the time, or we didn't have the money," Wells said. "Some bills were three or four months behind."

"Something should not ride for three or four months, until services were cut off," said Spurlock. "We should not pay late charges."

"So you would rather cash in a CD than put off bills?" asked Austin.

Councilmen in unison said, "Yes."

"When was the last time we had a full audit?" asked Spurlock.

"Three years ago," said Mayor Wells. "I was told that our health insurance had been canceled in November. Treasa had sent a check for $7,500 dated Oct. 23, but they did not receive it. Everyone's insurance was canceled until the full amount was paid. I had to rush a check for $15,000 down to Little Rock the next day, and they agreed to renew it. We would have been liable without health insurance.

"AFLEC is different, it has not been held out of their checks, but paid out of the general fund," said Wells. "Not all employees have it. Now the employees have to pay back the general fund."

Council asked for a report on AFLEC at next meeting.

"Our computers are down now," said Wells. "All checks should be taken off the computers."

The council voted unanimously to remove all games from all city computers (to include water department, firemen, policemen, and others).

The council discussed overlaying and repair of city streets. No decision was made.

Mayor Wells suggested that the council meet the last of December, since the November meeting had been later than usual. No meeting date was set.

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