July 23, 2014 at 2:10 p.m.
Redkey finances a mess (6/1/05)
Town council, attorney want answers from clerk
By By Mike Snyder-
REDKEY — Town leaders agree there’s a problem with the town’s financial situation.
But just how bad that situation is, and the root causes of fiscal problems that forced the town to borrow $20,000 to make payroll last month, are left unanswered.
Town officials hope they’ll get some of those answers at a special meeting of the town council Thursday at 4 p.m. at town hall.
Members of the town council have asked attorney John Brooke to ask for financial information from and tough questions of town clerk-treasurer Brenda Adkins, whose methods were criticized in an audit in the fall of 2003 by the Indiana State Board of Accounts.
Brooke, who said there have been reports of unpaid vendors and at least one bounced check on the town’s account, calls the problem “serious.”
Adkins, who has been the town’s clerk for more than 20 years, said the problems are a “cash flow” issue.
“We’ll be fine once we get our tax draw (in June),” Adkins said this morning. “The first six months of the year, with the ice storm and other things, it put us in a financial crunch with paying bills ... John (Brooke) just wants to take a look at our funding ... to see what we need to do to alleviate (borrowing) from happening again.”
In a letter to Adkins dated May 27, Brooke requested the following: Fund balances for all town accounts, a budget/expenditure report for the first five months of 2005; a list of delinquencies on sewer or water bills; a copy of water and sewer rate ordinances; outstanding claims that have not been approved or submitted for payment.
Violet Erlenbush, president of the town council and superintendent of the town’s wastewater treatment plant, said she and other council members aren’t savvy enough to understand the budget problems.
“That’s why we’ve turned it over to John,” Erlenbush said today. “I don’t think anything’s been intentional. I just think some things have gone through the cracks. Everyone just wants it corrected for the good of the town.”
Brooke, who also serves as a Delaware County Commissioner, was more blunt.
“The time for niceties and delicate conversation seem to have reached a point that something has to be done,” Brooke said, adding that he believes that town board members hesitated from asking tough questions of Adkins because of a desire to not create a conflict.
“The town has to do something. That’s why this meeting is coming up, to ask questions and to give me the information I need. I don’t believe there’s money missing. That’s not anybody’s belief. What (the belief is) is that Redkey is spending money ... improperly,” Brooke said.
Brooke was present when the council held an emergency meeting on May 20. At that meeting, the council approved obtaining a $20,000 loan from MainSource Bank to cover payroll and other expenses. The Dunkirk News & Sun staff was notified less than five minutes before the meeting began and did not attend.
Adkins said that a variety of factors had caused the cash flow problem, including under-budgeting for health insurance coverage and a $79,000 payment for sewer bonds that came due.
Asked why the shortfall in health insurance funds caused a problem within the first six months of the year, and why paying the sewer bonds from the wastewater utility fund would have implications on the general budget, Adkins said, “Even though (the money’s) in there, it’s not always that much in there because we plan to use it for the whole year. If (the bill) comes earlier than usual, it causes a shortage in the cash flow.”
In the report from state auditors in October of 2003, the methods and practices used by Adkins — including payment of claims without proper invoices, sloppy record-keeping, inadequate documentation and overdrawn fund balances — were criticized.
In a response to the audit, Erlenbush and Adkins pledged to take a variety of corrective steps, including submitting monthly financial reports to the town council.
Erlenbush said this morning that she has not received a budget report for “a while.” Erlenbush said she did receive the reports for some period following the audit.
Adkins said this morning that she has delivered individual budget status reports to department heads and council members.
In the letter to Adkins, Brooke wrote: “The town board members relayed to me that they have yet to receive monthly financial reports as specified in the State Board of Accounts Audit.”[[In-content Ad]]
But just how bad that situation is, and the root causes of fiscal problems that forced the town to borrow $20,000 to make payroll last month, are left unanswered.
Town officials hope they’ll get some of those answers at a special meeting of the town council Thursday at 4 p.m. at town hall.
Members of the town council have asked attorney John Brooke to ask for financial information from and tough questions of town clerk-treasurer Brenda Adkins, whose methods were criticized in an audit in the fall of 2003 by the Indiana State Board of Accounts.
Brooke, who said there have been reports of unpaid vendors and at least one bounced check on the town’s account, calls the problem “serious.”
Adkins, who has been the town’s clerk for more than 20 years, said the problems are a “cash flow” issue.
“We’ll be fine once we get our tax draw (in June),” Adkins said this morning. “The first six months of the year, with the ice storm and other things, it put us in a financial crunch with paying bills ... John (Brooke) just wants to take a look at our funding ... to see what we need to do to alleviate (borrowing) from happening again.”
In a letter to Adkins dated May 27, Brooke requested the following: Fund balances for all town accounts, a budget/expenditure report for the first five months of 2005; a list of delinquencies on sewer or water bills; a copy of water and sewer rate ordinances; outstanding claims that have not been approved or submitted for payment.
Violet Erlenbush, president of the town council and superintendent of the town’s wastewater treatment plant, said she and other council members aren’t savvy enough to understand the budget problems.
“That’s why we’ve turned it over to John,” Erlenbush said today. “I don’t think anything’s been intentional. I just think some things have gone through the cracks. Everyone just wants it corrected for the good of the town.”
Brooke, who also serves as a Delaware County Commissioner, was more blunt.
“The time for niceties and delicate conversation seem to have reached a point that something has to be done,” Brooke said, adding that he believes that town board members hesitated from asking tough questions of Adkins because of a desire to not create a conflict.
“The town has to do something. That’s why this meeting is coming up, to ask questions and to give me the information I need. I don’t believe there’s money missing. That’s not anybody’s belief. What (the belief is) is that Redkey is spending money ... improperly,” Brooke said.
Brooke was present when the council held an emergency meeting on May 20. At that meeting, the council approved obtaining a $20,000 loan from MainSource Bank to cover payroll and other expenses. The Dunkirk News & Sun staff was notified less than five minutes before the meeting began and did not attend.
Adkins said that a variety of factors had caused the cash flow problem, including under-budgeting for health insurance coverage and a $79,000 payment for sewer bonds that came due.
Asked why the shortfall in health insurance funds caused a problem within the first six months of the year, and why paying the sewer bonds from the wastewater utility fund would have implications on the general budget, Adkins said, “Even though (the money’s) in there, it’s not always that much in there because we plan to use it for the whole year. If (the bill) comes earlier than usual, it causes a shortage in the cash flow.”
In the report from state auditors in October of 2003, the methods and practices used by Adkins — including payment of claims without proper invoices, sloppy record-keeping, inadequate documentation and overdrawn fund balances — were criticized.
In a response to the audit, Erlenbush and Adkins pledged to take a variety of corrective steps, including submitting monthly financial reports to the town council.
Erlenbush said this morning that she has not received a budget report for “a while.” Erlenbush said she did receive the reports for some period following the audit.
Adkins said this morning that she has delivered individual budget status reports to department heads and council members.
In the letter to Adkins, Brooke wrote: “The town board members relayed to me that they have yet to receive monthly financial reports as specified in the State Board of Accounts Audit.”[[In-content Ad]]
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