A special audit revealed $7,725.00 missing from Marquette Park facility rentals
October 17, 2018-A special audit by the Indiana State Board of Accounts found that $7,725.00 was collected by the Marquette Park staff but never remitted to the City Controller for deposit. According to auditors, the park pavilion was available for rental to the public for various events including weddings, reunions and corporate events. Money from these events should have been deposited with the City Controller according to auditors. “In December of 2016, City officials became aware of a missing bank bag. A subsequent audit conducted by the City’s internal audit division identified collections of rental fees that were not remitted to the City Controller. Additional documentation was presented that indicated cash collections were being improperly used to pay various expenses of the park” the report states. According to the report, it was the responsibility of the park director (who was not named in the report) to remit funds to the City Controller.
Auditors cited a lack of internal controls as a factor in the misuse of funds “Multiple Park personnel handled the collection of Park receipts and had access to the collections.
There were no management oversight procedures in place to insure proper handling of receipts generated from Pavilion rental collections.”
In order to determine the amount that should have been remitted, auditors compared event files for pavilion rentals, park receipts and remittances to the City Controller. “Based on the combination of tracing receipts to the City Controller and the review of the
files containing rental agreements and invoices, we determined that a total $7,725.50 in Pavilion rentals were not remitted to the City Controller” the report concludes.
According to the report, ” Pavilion Manager stated that cash collections from Pavilion rentals were often used to purchase items for the operation of the Pavilion.” The report was discussed with Mayor Karen Freeman-Wilson, Angie Hayes, City Controller; and Nathaniel George, Park Superintendent. No disciplinary action against any employee was noted in the report.
The debacle comes after Council Member LaVetta Sparks-Wade discovered that the City had misappropriated millions in ambulance/ems fees in May of this year. The State Board of Accounts has not yet issued a report on the missing ambulance/ems fees, but Mayor Freeman-Wilson contracted City financial consultant Curtis Whittaker to do an internal review. Whittaker’s analysis determined that $7.7M was illegally transferred from the ambulance/ems fund over several years. The ambulance/ems fund is a restricted fund which can only be used for firefighter equipment and certain salaries pursuant to Gary ordinance. During the time that the Freeman-Wilson administration was transferring funds from the account, firefighters dealt with faulty equipment.
The Special Inspector General for the Troubled Asset Relief Program has also investigated that Gary Blight Elimination Program. That program is administered by the Gary Redevelopment Commission, which was the largest recipient of funds from the ambulance/ems fund. The SIGTARP audit has not yet been released. The City of Gary Department of Redevelopment terminated its relationship with one contractor earlier this year. It is not known if the termination was in response to any audit findings.
You can view the full Marquette Park audit below: