St. Peters is a dirty city-Part 2

This is the second part (Part 1) of my review of the St. Peters audit. It should be noted that the audit was given to St. Peters officials weeks in advance of its release but that the residents were not provided a copy until minutes before State Auditor Susan Montee presented her findings. I have been told that Montee did not even provide a copy of the audit to the petitioners until right before her presentation. Of course, by doing this Montee did not give the residents a chance to question her on the audit, which, after reviewing her work, I can understand. Now back to the audit:

7. Lack of accounting controls: Montee pointed out several areas in which St. Peters fails to keep adequate records:

a) The city has not taken a physical inventory of its assets in at least 8 years.

b) Meals purchased by Mayor Pagano and others did not contain information such as what was bought, who attended the meeting or why it was city business.

c) 118,000 gallons of water (6% of total) were not billed and the city only found this out after being asked by the auditor to check the numbers.

d) The city owns 263 vehicles but does not keep logs to ensure that the vehicles are being used for official business.

8. City Administrator's vehicle: The city has the choice of either providing the CA a vehicle or paying him a $900.00 car allowance. The city pays the CA the $900.00 a month which is significantly higher than the cost to provide him a vehicle or pay him for his mileage.

9. Major Transactions not competitively bid: Montee notes that there are 45 contracts (she says involving major transactions) in which the city has options to renew. Montee stated these contracts do not contain any limitations or specifics as to the price which will be charged if renewed. Montee fails to mention that the failure to include this information makes these contacts invalid and illegal. In addition, these renewals violate the city's ordinance requiring competitive bidding. Montee's audit, however, provides the residents no information as to the costs to the residents.

10. Lease not competitively bid: Montee reports that the city entered into a lease with a business for part of the expanded Rec-Plex. The business was to provide exercising and training proposals, however, the city failed to put this out to bid (anyone see a pattern here?).

11. Lack of documents: Throughout Montee's report she talks about the city's failure to provide supporting documentation and failure to keep adequate records. In regard to the Lakeside 370 project, the city, in explaining why it did not seek formal proposals, stated it had "informally negotiated with several interested developers." Montee, however, stated the city could not provide supporting documentation. On a deal of this magnitude (50 million) there will be supporting documentation if there truly were informal negotiations with developers. The city is required by law to keep these records, therefore, is this another case of St. Peters violating the law or another case of the city lying?

12. Misrepresentations by St. Peters:

a) St. Peters claimed in a press release (regarding the city's refusal to air the auditors report on the city's cable access channel) that "we legally cannot provide the televising and recording services at no charge." This press release was emailed to me by Lisa Bedian, however, she provided no authority for this statement. In fact, I emailed Bedian and requested that she provide authority last week and she has failed to respond. That is because there is no law which prohibited the city from airing the meeting.

b) St. Peters stated in a press release that "the Auditor’s report contained no improprieties of any kind and confirmed that St. Peters follows Missouri laws, ethics rules, regulations and City ordinances." This is absolutely false. I have pointed out some of the "improprieties" contained in the audit in my posts. I have also pointed out violations of the law shown by the report. Finally, Montee stated in her report she was not issuing an opinion as to the legality of St. Peters actions.

c) St. Peters claims the "report confirms that the City was not guilty of any wrongdoing and is making a sizable profit on the sale of Lakeside 370." This is simply wrong. The auditor notes several problems with how the city has handled this situation. In addition, the auditor made no finding that the city is making a profit on this project but she did note the city's estimated profit was wrong and that the city could sustain a huge loss on this project.

d) St. Peters response to the audit is filled with misstatements, excuses and deception. Take for example how the city supported its $900.00 car allowance to the CA. The city used the sticker price on a 2006 Ford Crown Victoria and then calculated the payments on a 3 year loan including interest. The city then added on the monthly maintenance costs, sales tax and property tax on top of this number. Of course, this number has absolutely no relation to the actual cost since the city failed to mention (1) no one pays sticker price, (2) interest, sales tax and property tax would not apply if the city purchased the vehicle, (3) depreciation on the vehicle; and, (4) the car will have value at the end of the 3 years.

The fact is that Montee's audit was so poorly performed that you cannot determine how much money St. Peters is costing the taxpayers. When reviewing this audit think what would happen with a private company that operated in this fashion. The cavalier attitude displayed by the elected and appointed representatives of St. Peters to the taxpayers money would never be tolerated by a business. In fact, any employee who provided their boss with the lame excuses, misrepresentations and deceptive answers that St. Peters provided would be fired on the spot. It is time the voters in St. Peters remember who the real bosses are and take back their city.