NEWFANE —
A state audit revealed Wednesday that the Town of Newfane provided fringe benefits to employees who were not eligible and that purchases were made without a proper bidding process.
New York State Comptroller Thomas P. DiNapoli announced his office completed the audit, which covered the period from Jan 1, 2008 to March 17, 2010.
• The state auditors found that certain employees and retirees were provided enhanced health insurance benefits and lump-sum payments that were not approved.
• The auditors also found that some employees and retirees were provided enhanced health insurance benefits and lump-sum payments that were not approved.
• The town provided $12,100 of unauthorized or enhanced health insurance benefits and approximately $6,700 of unsupported lump-sum payments to employees and retirees because officials did not properly follow board-approved agreements.
• Internal controls over procurement were not operating effectively. The board did not audit claims as required by law and rarely reviewed all of the claims and the supporting documentation.
“These audits are tools for local officials to make sure proper policies and procedures are in place to protect taxpayer dollars,” DiNapoli said in a statement. “The Town of Newfane must establish internal controls over employee fringe benefits, and procurement and claims processing, to ensure that they are appropriately designed and operating effectively.”
Town Supervisor Tim Horanburg and the board replied to the state comptrollers office on July 19 and wrote, “We plan to, in the future, use this audit as a learning tool to better serve our constituents. You have brought some items out in your report that need attention and we will certainly use due diligence in achieving these goals.”
The board has the responsibility to take corrective action and acknowledged that the findings concerning fringe benefits and lump sum payment are “accurate and true.”
The town also agreed with the five of the seven state procurement findings. The town disagreed with the audit on two findings.
• The purchase of an $11,000 rotary cutter. According to the town, the rotary cutter is a tree trimming attachment that fits a John Deere excavator boom only. The attachment is only manufactured by John Deere and distributed by only one regional vendor. Asking for bids would have only produced one quote for that vendor.
The state replied that the rotary cutter was not manufactured by John Deere.
• The state ruled that the $44,000 drainage project did not appear to be the town’s responsibility. The town defended the project by stating, “It does no good for us to do ditching upstream in the town if it has now outlet. There was a benefit to this subdivision, as there is to all home owner throughout the town.”
The state countered that the project primarily benefited the residents of one subdivision. The project did not provide a benefit to the town as a whole.
Other procurements included: $23,000 for roadside ditches; a Water Department tractor for $25,000; and blacktop services for $10,000.
The state alleged that the board does not audit claims as required by the state and that board members rarely review all of the claims. In reviewing 30 claims totaling $51,000, auditors found no evidence that any of these claims had been audited by the board.
Newfane employs about 80 employees and has a collective bargaining agreement with union employees.
According to Nicole Hanks of the comptroller’s office, audits are not out of the ordinary and field work may take months.
Local News
State audit claims ineligible employees got fringe benefits
NO BOARD AUDITS: The state alleges that the board did not audit 30 claims totaling $51,000.
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