YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

September 10, 2002

Report No. 2002-86

IMPORTANT:  The Missouri State Auditor is required by Missouri law to conduct audits only once every four years in counties, like DeKalb, which do not have a county auditor.  However, to assist such counties in meeting federal audit requirements, the State Auditor will also provide a financial and compliance audit of various county operating funds every two years.  This voluntary service to Missouri counties can only be provided when state auditing resources are available and it does not interfere with the State Auditor's constitutional responsibility of auditing state government.

Once every four years, the State Auditor's statutory audit will cover additional areas of county operations, as well as the elected county officials, as required by Missouri's Constitution.

This audit of DeKalb County included additional areas of county operations, as well as the elected county officials.  The following concerns were noted as part of the audit:

• The county's General Revenue Fund is in poor financial condition.  The cash balance of the General Revenue Fund decreased from $124,622 at January 1, 1999, to $17,367 at December 31, 2001.  In 2001, the county borrowed $60,000 in tax anticipation notes which will be repaid in 2002.

A significant factor in the decline of the financial condition was the addition of a courthouse elevator and other handicapped-accessible improvements.  The project, when totally completed, will cost approximately $250,000, but the county received grant funding for only $106,700.  Due to elevator construction bids being higher than the original cost estimates and that the lowest bidder could not complete the project, the county spent approximately $75,000 more on elevator construction than originally estimated.  It appears the county's decision not to re-bid the elevator construction and/or re-apply for grant funding may have resulted in significant additional costs to the county.

The County Commission needs to closely monitor revenues and expenditures and take steps to increase the balance of the General Revenue Fund.  The county could do a better job of maximizing certain revenues.

• The Multi-County (ACCD) 911 Board needs to make significant improvements to better account for 911 funds.  The board advanced monies to the various counties for mapping expenses; however, the board did not require the counties to submit documentation of actual mapping expenses incurred.  As a result, the counties received $239,507 more advances than actual amounts incurred for mapping expenses.  The board should discontinue providing advances to counties and require refunds of amounts paid which were not spent for allowable mapping purposes.

The balance of the Multi-County (ACCD) 911 Fund has grown significantly over the past four years from $356,261 to $600,549.  The board needs to review its operations and attempt to reduce the large accumulated balance.  The board indicated it is considering centralizing its operations which could significantly increase its operating costs.

The board also needs to improve its controls and procedures for more accurate budgeting, proper expenditure documentation, required training for dispatchers, and adequate records of general fixed assets.

• A state law, Section 50.333.13, RSMo, enacted in 1997, allowed salary commissions meeting in 1997 to provide mid-term salary increases for associate county commissioners elected in 1996 due to the fact that their terms were increased from two years to four.  Based on this law, in 1999 DeKalb County's former Associate County Commissioners salaries were each increased approximately $9,000 yearly.

On May 15, 2001, the Missouri Supreme Court handed down an opinion that holds that all raises given pursuant to this statute section are unconstitutional.  Based on the Supreme Court decision, the raises given to each of the former Associate Commissioners, totaling approximately $18,000 for the two years ended December 31, 2000, should be repaid.  In light of the ruling, any raises given to other officials within their term of office should be re-evaluated for propriety.

Also included in the audit are recommendations to improve procurement policies and procedures, budgetary practices, and matters relating to the Assessment Fund, Ex Officio County Collector, Circuit Clerk, Associate Circuit Division, Senate Bill 40 Board, and Senior Citizens Services Board.  Several of these issues had been noted in prior audits.

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