Report outlines reliance on transfers from restricted funds to support core spending, recommends additional oversight over utilities and payroll
JEFFERSON CITY, MO (STL.News) – Missouri State Auditor Nicole Galloway today released a citizen-requested audit of the Village of Ferrelview (pop. 373), located in Platte County. The report detailed significant financial concerns, failure to complete long-range planning in critical areas of need, and lack of oversight over village operations.
“The financial condition of the Village of Ferrelview is concerning, and my report points to several changes that must be made by the Board of Trustees to get back on track,” Auditor Galloway said. “Citizens should feel assured their tax dollars are being used responsibly and efficiently. That starts with a complete and accurate budget that incorporates long-term planning to meet crucial needs in the community.”
The village has relied on transfers from restricted funds to balance the budget. During 2016 and 2017, more than $110,000 was transferred to the General Fund from the Water and Sewer Fund and Street Fund, but there was no documentation as to why these transfer amounts were appropriate. The General Fund balance at the end of 2017 was $19,000; however, the village owes more than $20,000 to the Missouri Department of Revenue for excess revenues collected from traffic tickets.
Fiscal management was further complicated because the village did not prepare a budget for the 2016 or 2017 fiscal year. While a budget was prepared for the 2018 fiscal year, it was not approved until several weeks into the year, was incomplete and contained errors.
Village streets are in poor condition and, while the 2018 budget included a line item for street improvements, no significant improvement projects were planned or completed as of June 30, 2018. The village is eligible for approximately $68,000 in funding for road improvements through a countywide transportation sales tax, but has not requested funds from the county. The report also noted no funds have been set aside for repairs or maintenance of the water and sewer system, despite aging infrastructure.
The village does not consistently collect on delinquent utility accounts and follow the procedures in the shut off service ordinance. The audit detailed a specific instance when a trustee delayed and ultimately avoided service disconnection despite having an outstanding balance. Other findings included concerns about the accuracy of utility data, inaccurate accounts receivable records and a failure to properly monitor non-monetary utility account adjustments.
The report also found there is not sufficient oversight of payroll processes. Additionally, the village did not have ordinances or policies to address the number of hours worked by the Police Chief or establish compensation for administrative staff. After finding that more than 50 percent of spending from the General Fund was for salaries, the audit recommended the board evaluate the level of personnel needed to serve the village.