The state has found some inconsistencies in the City of Brazil's finances.
Recently, the Indiana State Board of Accounts (SBOA) released its audit examination report of the city, which reviewed financial information from Jan. 1-Dec. 31, 2009.
Included in the report of the audit, which was conducted by SBOA Field Examiner Lynne Spencer, are the total receipts, disbursements and balances of the city's funds (some of which were in the red), along with mismanagement of funds connected to a former employee.
According to the report, former Clerk-Treasurer Tracy Webster is linked to unauthorized vendor payments, plus overpayment of compensation and/or benefits on numerous occasions between May 4, 2007 and Nov. 21, 2008.
Even though the examination was for 2009 financial records, SBOA Deputy State Examiner Paul Joyce told The Brazil Times when negative balances or fund discrepancies are found, the examiners can go back to analyze records from previous years in an attempt to uncover any other instances.
"The findings of the audits are not accusations," Joyce said. "When we examine a particular and a discrepancy is found, we always try to find when it began, which allows us to review previous years."
For the unauthorized payments, the report states, "checks were payable to Tracy L. Webster, under the vendor name TRISTAR," which totaled $4,858.71 between Aug. 13-Nov. 7, 2007. This amount has been requested to be repaid to the City of Brazil.
In addition, the report cites numerous occasions in which Webster overpaid herself, which included a buyout for sick leave, which she was not eligible for, and two occasions when direct deposits for checks issued to her had been marked as reversed in the city's payroll records, but the bank was never notified in either situation.
A separate incident was also mentioned in the report claiming Webster issued a check "payable to MCC (Menard's Check Collections) on August 7, 2007, for $1,130.92 to cover a personal nonsufficient funds check written out of her personal checking account for personal expenses."
However, Webster was not the only individual listed as receiving an overpayment of compensation or benefits.
The report indicates Mayor Ann Bradshaw received $1,000 as a buyout for not accepting the city's health/accident group insurance on Nov. 14, 2007, the same day Webster also received the same amount for the same purpose. In addition, current Clerk-Treasurer Karen McQueen received an identical amount for the same purpose on Nov. 31, 2008. However, in their capacities as elected officials at the respective time periods, they were not eligible for the buyout, and records showed Webster had also applied for and received the health insurance in 2007. According to the report, both Bradshaw and McQueen have repaid the amounts.
Bradshaw was also mentioned as receiving $2,428 on Oct. 16, 2008, while Webster (who was deputy clerk-treasurer at the time) received $2,306 on Nov. 21, 2008, for which "was thought to be 2007 underpayment of salary." It was later determined they had not been underpaid, and Bradshaw repaid her amount in full on Feb. 5, 2009. The report shows Webster signed a promissory note Aug. 6, 2009, to repay her amount in installments of $100 a month, which were paid in September and October 2009, but none since. It is also mentioned that Webster has filed bankruptcy.
In total, Webster has been instructed to repay a total of $19,550.54, which includes reimbursing the State of Indiana $6,500 for additional audit costs incurred due to the investigation.
The examination report also includes a one-page statement from Webster to the SBOA in reference to its findings. It also states, "Due to an ongoing Indiana State Police investigation of former Clerk-Treasurer, Tracy L. Webster, more charges could be uncovered at a later date."
For the city's financial records from 2009, the report found eight separate areas in which the funds were overdrawn including the General Fund, which began the year $231,290 in the red and finished $409,093 in the hole.
In 2009, the city had a total of $14,582,400 in receipts and $15,110,965 in disbursements across all the governmental, proprietary and fiduciary funds. The year began with a total of $2,868,964 in cash and investments across all the funds, and after the receipts and disbursements, $2,340,399 remained as of Dec. 31, 2009.
In response to the audit's results, Bradshaw told The Brazil Times she was not surprised by the financial findings, but is letting the authorities do their due diligence on the investigation into the mismanagement of funds.
The full SBOA examination report on the City of Brazil's 2009 financial records is available for viewing at www.in.gov/sboa/WebReports/B38407.pdf.