Spouse travel expenses among findings
BY MARK J. CRAWFORD
At the recent Starke City Commission meeting, auditors from Powell and Jones presented their annual report, offering a detailed assessment of the city’s finances for the fiscal year ending Sept. 30, 2024.
The presentation, delivered by Brad Hough, offered both good news as well as some constructive feedback to city leaders.
Hough reported a “clean or unmodified opinion,” meaning the financial statements provided are reliable and materially accurate. Notably, the city’s general (governmental) fund boasted an unassigned fund balance equivalent to 11.6 months of regular expenditures, far surpassing the Government Finance Officers Association’s recommended minimum of two months.
During the fiscal year, the city’s general fund balance increased from $3.1 million to over $4 million, a combination of both tax revenue and capital grant funding. Proprietary (business) funds from utilities also showed positive cash flow, despite an operating loss due to depreciation. Utilities generated nearly $12.3 million in revenue. The city had about 4.5 months’ worth of utility spending in reserve, Hough said. Grant income boosted net position by nearly $10 million in 2024.
The auditors reviewed city pension fund liabilities and found them consistent with market trends, noting their fluctuation is typical as they follow economic conditions. The city’s net pension liability was $4.5 million.
With $12.7 million in federal award spending and another $2.7 million in state awards, auditors conducted single audits to ensure compliance. Starke complied with federal and state funding requirements, according to Hough, as it advanced these wastewater projects.
Audits exist to find areas for improvement, and the 2024 audit found a couple. Starke has over the years corrected a few repeat errors, but one holdover from 2023 were errors discovered in the city’s Schedule of Expenditures of Federal Awards and State Financial Assistance. “Certain grant amounts were improperly excluded, and revisions were required to ensure completeness and accuracy,” according to the audit. It’s this kind of error, if not caught, that can lead to noncompliance with federal and state requirements.
The city has been advised for a second time to strengthen is process for preparing the schedule by assigning it to a dedicated grant manager or staff member with sufficient time and expertise.
In the second finding, the city was charged nonessential travel expenses when the spouses of City Manager Drew Mullins, former City Clerk Jimmy Crosby and former Commissioner Scott Roberts attended a legislative rally in Washinton, D.C. According to the audit, the charges were made to the city credit card without appropriate documented approval and justification why their spouses’ attendance was necessary for the performance of their job-related duties.
If the travel expenses were unnecessary, this could be a misuse of public funds and a violation of Florida statute, according to the audit. The city needs to determine the necessity and potentially request reimbursement, which management said it would do. In addition, the process for approving travel will be expanded to include upper management, to include the manager, clerk and commissioners. Mullins will bring a policy for commission approval.
The presentation concluded with thanks to city staff for their diligent efforts and a reminder that keeping processes up to date ensures accountability for residents.
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