City of Cortland officials were recently audited for unsupported and questionable/inappropriate credit card claims close to $15,000, according to the New York state comptroller’s May report.
The report, which highlights the audit period between Jan. 1, 2018 and Dec. 31, 2019, showed 74 percent (322 of the 436; 436 reviewed that totaled out to $71,738) of the claims were reviewed as “not properly supported.”
“No formal city-wide policies were in place to address the usage, documentation and approval of credit account purchases,” the report states.
Of the $14,236 undocumented claims, $9,905 came from 164 credit charges that were not properly supported, and $4,331 came from 158 claims that were questionable and/or inappropriate purposes.
Out of the $4,331 in questionable claims, $2,591 of it was used for meals.
In order to avoid credit card purchases going undocumented, the comptroller laid out four recommendations for city officials:
- Adopt policies that provide guidelines for appropriate usage, documentation requirements, and the approval process for credit account purchases and employee reimbursements
- Ensure that city-wide policies are followed by all departments
- Ensure that credit account and employee reimbursement claims are thoroughly audited, including verifying required documentation to support purchases is intact and purchases are appropriate; credit account statements should be reconciled to itemized support documentation before approving claims for payment
- Ensure that credit account statements are paid timely to avoid unnecessary late fees and interest penalty charges
Mayor Brian Tobin responded to the comptroller’s reporter through a letter, stating “we recognize and agree that there is no comprehensive policy to direct department heads and employees as to usage, how to document, and what is needed to approve credit card purchases.”
Tobin was unsure if the unsupported claims were made through taxpayer or grant money, or other forms of funds.
“This has been a topic of discussion between (Common) Council, the director of administration and finance (Mack Cook) and the mayor for several years,” he added, stating that he’s confident the city will move to formalize a city-wide policy.”
Tobin said last week that the topic has been a discussion in multiple Common Council meetings, but a decision to finalize a potentially decisive plan was put on hold until the comptroller’s audit was released.
“We’ve got a solid framework on how to handle situations like this,” he said.
Tobin reiterated that there is “nothing illegal about this at all” in reference to the unsupported claims reported by the comptroller.
While Tobin agreed supporting documentation is needed for credit card charges, he disagreed with part of the report revolving around $2,591 in purchases of meals.
“We have consultants from out of town, and we have to utilize their expertise,” he said. “Sometimes, that means working through lunch.”
When Tobin questioned these specific purchases, the comptroller responded by saying the purchase of meals during a business meeting is “incidental” and therefore “a personal expense.”
Tobin said one example of this is completing business “in a day instead of multiple days.”
“If anything, it saves the city money in terms of overnight cost for a hotel,” he added. We have some expenditures that were better for the city. It reduced other costs.”
Moving forward, Tobin said the simplest action is to answer questions from the recommendations and “try to improve so we can develop the best practices.”
“We’ll make adjustments,” he added. “At the end of the day we’re doing what’s right.”
