State law requires that the State auditor’s office conduct “an examination of the financial condition of all local governments at least once in every three years.”
The last audit report for Key Pen Parks covered the years 2008 and 2009 and found nothing of significance. The recent examination and report completed in November 2013 was not as kind.
The Auditor found that both business and personal purchases had been charged to the district’s credit card. Key Pen Park’s name appeared on the card, but the card was actually issued personally to the Executive Director, using the director’s personal credit, all in violation of mandatory statutes and policies.
The Auditor report said that in 2012, when purchasing 39 acres (Gateway Park) for $826,000, Key Pen Parks also paid $5,788.69 to the seller for moving expenses. Such payment was in violation of statutes, policies, and even the terms of the grant contract which helped pay for the purchase.
The Auditor found that timecards were not signed, as required by the district’s own policy.
The report showed that vehicle and fuel use were sometimes not logged and monitored, and that park vehicles were not marked as district assets and “for official use only” as required by state law.
The Auditor found an inadequate inventory and tracking of small and attractive assets which might be lost or stolen.
According to Executive Director Scott Gallacher, all corrective action recommended by the Auditor has already been completed. The credit card has been canceled with a new one issued using solely the district’s name and credit.
The land purchase and related payments were a one-time event that will not recur. Internal policies and procedures have been modified or implemented to better monitor and control park assets, and the proper identification has been placed on the vehicles, Gallacher said.
State law requires that any audit report that contains findings of noncompliance with state law must be forwarded to the Attorney General. A determination is made if such report discloses malfeasance, misfeasance, or nonfeasance in office, or on the part of any public officer or employee, and if so, the Attorney General is required to institute, within 30 days, any potential legal action that may be warranted.
The 30-day time limit has passed, and no action was filed. Both the Auditor’s office and Attorney General’s office have been contacted, and say that no action is expected.
Gallacher said that the findings appear worse than they actually are.
“When Key Pen Parks was created, it had no credit and could not obtain a credit card in its own name,” Gallacher, said. “I volunteered my own credit card for parks’ use, placing my own credit at risk. None of us were aware that this violated law or policy.”
“There was an emergency situation where my transmission failed on a trip, and I was stranded. I used the credit card, and kept the charges and payment separate,” he added.
According to the audit report, there was only one other time that a personal charge was made to the card by another district employee, which again was kept and paid separately.
“The moving expenses were authorized by the Parks Board only after I had consulted with Washington State Department of Transportation to see how they handle moving expenses for displaced occupants/tenants when they acquire additional right-of-way,” Gallacher said. “We tried to do the right thing, and had no idea that we were doing something wrong.”
Except for the payment of the moving expenses, the Auditor was unable to identify for his report any misappropriation of Key Pen Parks funds, only that “the District cannot ensure accountability of public funds and property in the areas noted.”
Gallacher said the Auditor’s examinations and reports will be used as a needed stimulus and guide to better serve the public.
“Our policies and procedures have all been tightened up and will be monitored closely to resolve the other issues raised,” Gallacher said.