View from the Cheap Seats: Monopoly money
Ever lose at Monopoly? I sure have. Isn’t it disturbing to see the money you earned passing “GO” eaten up with rent and taxes before you reach Boardwalk?
But you know, losing that money isn’t really difficult because, well, it’s only Monopoly money after all. The city of Bay Village's Finance Department acts like the city runs on Monopoly money too, as was emphasized to me last Monday evening.
I’m not really sure why, but that night the wife and I intentionally attended the City Council committee session. You should try it sometime. It’s frequently more fun than watching monkeys play football, and it was fun Monday, right up to the finance discussion.
This was a long and spirited verbal fistfight about a situation where the Finance Director ordered a $19,000 vehicle for the Police Department. Only one problem – council hadn’t approved the purchase and they’re the only ones who can OK spending actual money.
By the time someone caught the mistake, the order couldn’t be cancelled. Since our city is operating about $800,000 in the red this year, I thought this was pretty scary, the unintentional spending of $19,000 without authorization. The Finance Director acts like he’s spending Monopoly money.
I normally find accounting and audit reports boring, but I have been the leader of several organizations with larger budgets than the city and I’ve read quite a number of audit reports. In the Air Force, I served for several years as an Inspector General, so I know how to both read and write inspection reports and I can tell if the inspectors are painting the picture of a healthy organization with problems or a seriously sick operation.
Wondering if this little boo-boo was a trend, I whipped out my trusty internet access Monday evening after the meeting and reviewed the Ohio Auditor of State’s audit reports on the City of Bay Village from 1999 to 2008 (the 2009 report hasn’t been published yet).
I was astonished and disturbed by what I found. Not only did the reports paint a picture of serial financial bungling, but of leadership incapable or unwilling to fix the mess. The “who cares, it’s only Monopoly money” syndrome was obvious.
In every single year, save 2007 and 2008, the auditors identified instances where expenditures exceeded appropriations – in other words, where the administration spent money City Council hadn’t authorized (or some variation of that act). In 1999 there were 97 instances; in 2000, 58 cases; in 2001 they caught the problem 62 times; in 2002 they found 54.
In 2003 the inspectors tested 82 purchase orders and found that one in four had invoices dated before the purchase order, indicating the purchase was completed before it was approved. In 2004 the audit showed $1.17 MILLION (not a misprint) was spent in excess of funds available.
The next year they found the same thing, but to the tune of $2.23 million. Gulp. All this time the city’s leaders were, um, well I’m not sure where they were, but it appears they weren’t paying attention, and certainly nobody was fixing anything because several of the reports identified problems from one year that hadn’t been addressed by the next.
In 2006 the report cited three cases totaling $1.44 million where expenditures were made without proper appropriations. In 2007 (it just goes on and on, doesn’t it?) the auditors tactfully pointed out that putting the $15.4 million estate tax windfall in the reserve fund violated Ohio law. Guess this was news to the Finance Director who knew about the move and should have known better – heck it was his JOB to know better!
This long and ugly record of financial malfeasance with our Monopoly money should concern all Bay taxpayers. It's OUR Monopoly money: We earned it and they’re wasting it.
Alex Dade lives in Bay Village.