The Sea Breeze Fire District in Irondequoit failed to keep basic accounting records or address questionable expenditures over several years, according to an audit report released recently by the state Comptroller’s Office.
The audit, which the office completed in February, covered the period between Jan. 1, 2016 and Feb. 22, 2018. The 20-page document portrayed a fire district that had loose record keeping and unclear policies for spending money, which ultimately were not followed.
For example, the district set a policy where credit and debit card expenses needed to be pre-approved by the board of commissioners. However, because there was no set policy in place to document those pre-approvals, the district had five debit card charges totalling nearly $5,000 on the books during the audit period with no records of approval by the commissioners.
The audit found overall the district did very little to maintain records of its finances, and it points to one instance specifically where that lack of oversight cost taxpayers. The audit stated that the district failed to calculate its spending cap during all three years of the audit period, spending $47,490 over the cap.
A fire district is allowed to go over its spending cap, but it requires a vote by the board of commissioners. The Sea Breeze board held no such vote during the years the audit covers.
“As a result, the Board did not have information necessary to make financial decisions including ensuring budgets were within statutory limits,” the audit report states. “The lack of reports deprived taxpayers of the transparency necessary to evaluate the Board’s decisions, the assurance that budgets conformed to statute and the right to vote on the additional expenditures.”
In January, CITY published an investigative reportdetailing fire district elections, and how districts often override their tax caps. For example, the Ridge-Culver Fire District, also in Irondequoit, overrode its tax cap every year for the past decade, increasing its budget by about 66 percent over that timeframe.
The audit faults the district’s treasurer for keeping inadequate records. It also criticizes the authority given to district Fire Chief Dave DeRoller to make financial decisions at his own discretion. For example, on Nov. 1, 2016, a $6,431 insurance claim was paid out to the district, which was deposited into a Chief’s Association bank account, said the audit report. The bank account then paid out $6,000 to an auto shop.
District Chairman Ray Walker not only was unaware of the insurance payout, he didn’t even know the accident occurred, according to the audit report.
“The Board’s failure to actively manage District assets exposes the District to the risk of financial loss,” the audit reads. “It also enabled the Chief to damage and repair a vehicle, and request and spend a District insurance recovery, all without the Board’s knowledge. This raises significant concerns that other incidents or activities may have occurred, unbeknownst to the Board.”
A voicemail left with the department was not immediately returned.
Insurance also arose as an issue in the audit. The district was unable to provide proof of insurance for its vehicles and equipment to the Comptroller’s Office, according to the report.
“While District officials believed they had active insurance for loss and liability, they were unable to provide any insurance declarations or other documentation to support insurance coverage, including any premium bills or proof of payment,” the audit states.
In response to the audit, Walker said he overall agreed with the findings, and said the district was taking steps to ensure it mended its errors.
“While we acknowledge our inadequacies, we also do not believe anything was done in an intentional malicious manner meant to defraud our taxpayers,” Walker wrote. “Rather, not knowing the rules or having proper procedures in order.”
Gino Fanelli is a CITY staff writer. He can be reached at (585) 775-9692 or gino@rochester-citynews.com.