Missouri State Auditor releases Village of Mineral Point audit with a rating of “Poor”

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A new report issued by Missouri State Auditor Scott Fitzpatrick details how a small town in Washington County is now in poor financial condition because of a lack of oversight and inadequate budget planning by local officials. The audit of the Village of Mineral Point issues the municipality a rating of “poor,” which is the lowest possible, and also highlights misappropriated funds, unsupported disbursements, and how government officials failed to maintain the village’s utility billing system.

“The residents of the Village of Mineral Point deserve a government that serves responsibly and accountably, but in this case, we see how government officials failed to adequately serve taxpayers because of gross mismanagement,” said Auditor Fitzpatrick. “Our performance audit provides a roadmap for officials to get Mineral Point back on track so that it can be an efficiently run municipality. I encourage village officials to implement our recommendations as quickly as possible.”

The audit, which was initiated at the request of the current Board of Aldermen, details how the village is in poor financial condition and how prior Boards have not adequately monitored or taken effective action to improve the condition. For 2022, disbursements exceeded receipts by $40,504, which brought the balance of all village bank accounts to $72,741. The village’s finances are further strained because of a significant amount of unpaid bills and $37,000 that is obligated in matching funds for two grant awards. In total, the poor financial condition is the result of a failure by the village to consistently bill its residents for utility services, weaknesses in oversight and accounting controls, a lack of budget planning and financial reporting, and an inability to pay bills in a timely fashion.

When the State Auditor’s Office first examined the village’s utility system it found data related to previous billings to residents and account balances had not been accessible since July 2022. The village possessed three computers, two of which contained no recent utility data and a third that was inoperable. Because of the lack of access to the data, the village did not consistently issue billings in 2022 and subsequently reset all residents’ account balances to $0 because of the lack of records to indicate amounts previously owed. Because of the failure to properly maintain the utility billing data, the village failed to collect an estimated $35,407 from May through December 2022, which contributed to the village’s poor financial condition.

The report also highlights how in 2022 the village had $350 in disbursements that were misappropriated and another $1,197.50 in disbursements that were unsupported. Two checks totaling $292 were issued to the Village Clerk with unknown Board member signatures, and a check for $58 was issued by the Village Clerk to herself. No documentation was provided to support $394.29 of a total of  $2,194.29 in reimbursements issued to the Board Treasurer. The  Board also issued a check for $577.39 to the Utility Operator for vacation pay despite the fact the village has no policies or ordinances allowing for vacation leave or pay. Additionally, the Village Clerk received an additional $225.82 when a check issued to her was deposited and cleared twice.

The audit notes how prior Boards did not establish adequate oversight or segregation of duties over various financial accounting functions, and how the village did not always maintain adequate accounting records over its financial activities and decisions. The report also points out that the village did not prepare a budget for both 2021 and 2022 and failed to file complete and accurate financial reports with the State Auditor’s Office as required by state law for both years. Additionally, the audit found the village does not have personnel ordinances and policies to address topics such as compensation for village officials and employees, employee hiring, work schedules, termination, vacation and sick leave, overtime, compensatory time, or other arrangements. Other findings include a lack of compliance with the Sunshine Law and a failure to develop a records management and retention policy that includes electronic communication.

The complete audit of the Village of Mineral Point can be found here.

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