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Tuesday, June 27, 2006
Ind. Gov't. - The budget of a city is much different than your own home checkbook or even for a person running a business
A story today in the Chicago Tribune is about an Illinois town, but the problem isn't limited to Illinois. Some quotes:
When the longtime treasurer of tiny northwest suburban Lakemoor resigned a year ago, untrained office workers were asked to update village finance reports on a computer they didn't know how to operate.The story recalled to me the dispute over the new clerk in Martin County.The result: financial chaos.
"Municipal budgets are horrendous," said Virginia Povidas, a full-time bookkeeper who was elected Lakemoor's village president last year.
She grew so frustrated after being questioned at a recent meeting that she dumped a mound of canceled checks on a table for board members to inspect.
Confusion over multimillion-dollar public budgets is common, especially in small communities with little or no professional staff and part-time elected officials.
In northwest suburban Carpentersville, auditors who examined the village's books over a four-year period ending in 2004 said officials had not accurately accounted for at least $3 million in village funds.
And auditors recently uncovered a similar problem in Antioch, where professionals blamed a $3 million gap in the financial ledger on faulty bookkeeping exacerbated by high staff turnover.
"The budget of a city is much different than your own home checkbook or even for a person running a business," said Dwight Horkheimer, manager of the Leadership Training Institute at the National League of Cities in Washington. "It's a critical subject that all public officials need to be knowledgeable about." * * *
The village, on the border of Lake and McHenry Counties, did fine when it had 700 residents. But the one-time resort town dotted with summer cottages has seen the construction of hundreds of new homes in the last six years, and its population ballooned to an estimated 5,000.
As the village [of Lakemoor] grew, so did the complexity of its finances. Then its longtime treasurer resigned.
While she looked for a replacement, Povidas passed on the bookkeeping responsibilities to two "office girls," clerks whose primary job had been handling utility bill collections.
"They knew how to do utility billing, but they didn't know how to do invoices or get things charged to the proper accounts, and no one knew how to work the computer, so we put everything on paper to back ourselves up," Povidas said.
Village Board members noticed holes in the reports and began hounding Povidas for more information on the $2.5 million budget. "We used to get quarterly reports off the computer that showed us what we were spending and taking in," Trustee Todd Hendrickson said. "Now we're getting handwritten breakdowns and wondering what's going on, but no one can tell us."
Posted by Marcia Oddi on June 27, 2006 08:17 AM
Posted to Indiana Government