Report No. 2009-130
November 2009
Complete Audit Report
Findings in the audit of the City of Garden City
Aquatic Center
The city did a poor job of planning the financing and construction of the city's aquatic center. Due to ineffective planning by city officials, it appears the aquatic center may not be what the citizens expected and/or what was initially intended, and the center is not self-sufficient. As a result, other city funds have been used to pay the expenses of the center, and the continued revenue shortfall of the center may result in the reduction of other necessary and vital city services. The city borrowed over $100,000 from the General and Sewer Funds in 2008 to pay some of the project construction costs and certificates of participation principal and interest payments, and it is unclear when or if the funds loaned to the Aquatic Center Account will be paid back.
Water and Sewer Funds Fees
The city did not adequately document its rationale and/or justification for assessing operations and maintenance fees to its utility customers, or for assessing a franchise fee against revenues of the Water and Sewer Funds. In addition, a franchise fee was applied retroactively and it is unclear if applying the fee retroactively is proper.
Budgeting and Financial Reporting
Weaknesses were identified in the city's budgeting and financial reporting. The city does not prepare and adopt annual budgets in accordance with state law. The budgets do not include a budget message, actual receipts and disbursements for the two proceeding budget years, or estimated ending available resources. The city's published semiannual financial statements do not fully comply with state law. The statements do not include the indebtedness of the city and a full and detailed account of receipts and disbursements.
Notices and Meetings
The Board's procedures for conducting and documenting meetings need improvement. Open meeting notice agendas routinely used the same statement to indicate the potential for a closed meeting/session, although no closed meeting/session was planned or held. Also, the Board did not document how some issues discussed in closed meetings were allowable under the Sunshine Law.
City Policies and Procedures
Weaknesses were noted in the city's policies and procedures. Retroactive pay increases may represent additional compensation in the form of a bonus and, as such, may be in violation of the state constitution. The city has not established an ordinance for employee compensation or the term of office for the City Clerk, and the compensation of elected officials is not set by ordinance. The method of allocating wage expense among the various city funds is not supported by documentation. The city does not have a formal written agreement with its attorney, and payments made to the attorney are not properly reported to the IRS.
Complete Audit Report
Missouri State Auditor's Office
moaudit@auditor.mo.gov