Two Hamilton County constitutional officers spent too much last year on salaries, one officer has reportedly been violating bank agreements by charging fees for taking credit card payments, and computer errors have caused accounting bloopers for the county's various clerks, an audit released Thursday states.
Of the eight fee-collecting constitutional offices audited, five had reported bookkeeping issues.
The audit for the 2012 fiscal year, completed by Decosimo Certified Public Accountants in cooperation with County Auditor Bill McGriff, found problems with the ways Clerk & Master S. Lee Akers, Sheriff Jim Hammond, Criminal Court Clerk Gwen Tidwell, Circuit Court Clerk Paula Thompson and Trustee Bill Hullander are running their shops.
In most cases, the auditors' findings were corrected in December, shortly after the audit was performed. Most findings reported clerical oversights or faulty computer systems. But in some cases -- such as with Akers -- few to no changes have been made.
CLERK & MASTER
When Akers' office collects court costs or delinquent tax payments by credit card, he charges a 3.2 percent fee to cover processing costs, according to the audit. Last year, he collected $23,353 from the fee.
But auditors say that fee violates agreements his office has with banks that process the transactions.
Auditors recommended that Akers cease accepting credit cards until he can change his banking agreement or comply with a 2008 county resolution that would allow Akers to waive the processing fee "and to absorb such fees as costs of the office."
But Akers isn't doing either. He says the fee is legitimate.
In an response to the auditors' findings, Akers said state law allows him to charge processing fees "in an amount that is reasonably related to the expense incurred in processing the payment."
Auditors also found Akers had exceeded his salary expenses last year by $5,474.
All constitutional officers enter agreements capping total spending on salaries with Mayor Jim Coppinger. In Akers' case, that's $1,220,308. But last year Akers spent $1,225,782.
Auditors say in the future, Akers should abide by the letter of agreement -- but Akers denies violating it.
In his response, Akers said he has "the legal authority to have a policy to award educational and longevity achievement benefits to his employees out of his fees."
He says benefits are not salary and are not covered in the agreement with Mayor Coppinger.
Auditors rebutted that Akers has no such authority and is bound to his agreed-upon salary limit.
In both cases, the same issues were raised in previous audits. Akers' audit was the only one in which auditors made rebuttals to managerial responses.
Hammond also exceeded his salary allotment -- by $220,850.
According to the audit report, once Hammond realized he had exceeded his agreement amount, he drafted an amended letter -- which state law allows. When he brought the letter to Coppinger, the mayor chose not to sign and validate it.
In Hammond's response, he said he would not exceed his budget or letter of agreement this year.
Auditors also found Hammond's office had not been keeping full books on criminal background check payments it received from the state.
The sheriff's office bills the state $15 each time deputies perform background checks for residents. Hammond's office then sends the application materials to the state, and the state pays Hammond's office monthly.
Auditors found Hammond's office had been keeping track of what background checks it processed and billed, but it wasn't "reconciling the subsequent payments received from the state" against its own records. Hammond's office had collected $32,805 from the state, which would pay for 2,187 background checks.
CRIMINAL COURT CLERK
According to the audit, Tidwell's office has "informal procedures as guidelines" for collecting delinquent litigation taxes, court costs, fines and other fees. As a result, auditors found collections were inconsistent. Auditors suggested Tidwell set up written procedures to make delinquent bill collection more effective.
Tidwell responded that her informal process was sufficient and formally documenting the process was unnecessary.
CIRCUIT COURT CLERK
The audit found Thompson's office had not been holding its funds in interest-bearing checking accounts.
Since September 2011, when the clerk's bank stopped paying interest on the account, Thompson had an average daily balance of $1.6 million that was not earning interest. As a result, her office's interest earnings dropped by $5,000 from fiscal year 2011 to 2012.
Thompson said in the audit report she would find a new bank.
Auditors found Hullander's office was using two different financial programs to manage money, leading to accounting inconsistencies.
The report recommended Hullander consolidate into one accounting program.
Hullander said fees the trustee's office collects for its own operations are kept in a separate bank account and it receives a commission for disbursing funds for other county agencies. His office will continue to use two programs, but the inconsistencies have been addressed, according to his response to the audit.
Auditors also said Hullander should put in place a procedure to document new journal entries. He agreed to do so.
• According to the audit, the Clerk & Master's office overcharged 113 residents who had delinquent taxes but had made partial tax payments to the county trustee. There were $786 total overcharges, and residents will receive refunds or rebates. The error has been fixed, according to the audit.
• Last fiscal year, the Sessions Division of Thompson's office paid $19,821 in collected court fees to the wrong county sheriff. The money went to Hammond's office instead of other sheriff's offices involved in the court. The error has been fixed. The audit doesn't report how or if the erroneous payments will be corrected.
• In Criminal Court, several people who were delinquent in paying court fees or other costs were not being charged, because an error in a computer program was excluding them.
The error also prevented the court from properly collecting its 50 percent commission on delinquent cases. As a result, the court overpaid $131,871 to the state, $178,578 to the county and $39,904 to other municipalities. The lost fees will be deducted from future fees.
Contact staff writer Louie Brogdon at email@example.com or 423-757-6481.