Supervisors explain how officials are working to fix how funds are handled
The board of supervisors in Penn Forest Township, at their last meeting, spoke with residents about the township seeing large deficits in past years and how the supervisors have been working on fixing the situation.
During public comment a resident asked for an update on the FBI investigation that is taking place for the alleged misappropriation of $1.6 million.
Chairman, Paul Montemuro stated, "We are not allowed to say anything until they are done their investigation. We basically have to let them handle it."
Montemuro went on to discuss other issues regarding township funds.
"I just wanted to show the people and explain where a lot of the money went and where we figured out a lot of where it was spent," stated Montemuro
"The $1.6 million (mentioned earlier) is a different thing but I'm going through different funds," he added.
Montemuro stated that in the past, Penn Forest Township's money was all put together into the General Fund. Their auditors suggested breaking everything up into different funds.
He added that you can't keep track of the money when it's all in one fund. If a department is losing money no one would know which one.
The township's money is now broken up into different funds.
Montemuro stated that the township lost $88,000 one year, $163,000 another year, $248,000 another year, and so on. He added that it adds up to millions of dollars.
A member of the public asked what are the checks and balances for going over the books.
"We have a CPA now that does it. They are not elected auditors. We have certified people doing the books and they do give statements to everybody here," said Montemuro.
Supervisor Christine Fazio, who had been an auditor for Penn Forest Township, spoke about the responsibilities of an auditor.
"As an elected auditor we are given a booklet by the commonwealth that we complete. We are not held to the same standard as a CPA," stated Fazio.
"There was a shortfall the first year I was auditor,"
Fazio stated that the only person that herself and the other two auditors worked with was the township manager.
"She (the township manager) was aware of the deficit. We had a cover letter. We gave her the paperwork. She was supposed to submit it to everyone on the township supervisory board," said Fazio.
The supervisors at the meeting stated that they never saw a letter or any kind of notice about the deficits.
Montemuro stated that according to past meeting minutes the deficits were never brought up at any public meetings.
Fazio stated that once the numbers from the audit were done then the numbers were published in the paper.
Supervisor Alan Katz later stated that he felt the deficit should have been mentioned in a management letter.
Fazio stated that the auditors followed procedure and handed the audit to the township, sent the audit information to Harrisburg, and had the information published in the paper.
Montemuro continued, "Like I said before when we got in here everything went in the general fund."
In regards to the all money being put in the general fund, "Nobody can keep track of the funds. I'm not blaming the auditors here because the way this had been hidden. It took the CPA a while and took me a long while, and I've been in four years. I'm slowly getting in section to section," stated Montemuro.
The money in the general fund comes from township residents taxes. The supervisors are in charge of what happens with the general fund. Any money that is spent is supposed to be voted on at public meetings.
Montemuro stated that years ago when someone would be buying lots they were charged $400 by the township for the sewage permit. However, the engineer would charge the township $1,200 for the sewage permit. The remaining $800 that wasn't paid by the person buying the lot was coming from the general fund.
"We were losing $800 for every lot that was sold in Penn Forest Township, for I couldn't tell you how many years," he added.
"The shortfall of the money came out of our general fund."
The sewage permit fee currently is now $1,200.
The township now uses an outside engineering firm, Barry Isett & Associates.
Montemuro stated that many of the township employees had been let go. The township has new employees from A to Z, from auditing to solicitor.
The township's new solicitor is Attorney Gregory Mousseau.
Montemuro added, "Everybody here now, all the new employees and the new companies that's in charge of the building, zoning, and sewage, they are all accountable for every penny. They don't go out and do inspections unless the money is in the fund."
Montemuro said that in 2008 when they came in as a new board. The township was $650,000 in the hole. He then began digging into the townships numbers.
Katz stated that he and Montemuro realized there were problems when they looked at the expenses that the township was paying out and compared that to the revenue the township was taking in.
Montemuro stated that because the township lost all that money, taxes had gone up the one year to help repay the loss of funds.
Now, the township has $1,582,666.68 in the general fund. The general fund, allocated department funds, and other allocated accounts total $5,929,032.20.
Montemuro pointed out that the township is doing some major projects including a bridge project. The township has no loans and they have been buying their own equipment and trucks. The township also has its own site for salt and cinders. Road repairs are being done all over the township.
Montemuro stated that if the township keeps running this way, where people are accountable, then taxes shouldn't have to go up.
A member of the public questioned how the audit ledger, which was mentioned at last months meeting, could have been found empty.
Judith Knappenberger, vice chairman, stated that she last saw the book was in August of 2010 and it was locked up in a file cabinet with the minute book. She had been showing a new secretary how to deal with the paper work.
She added that at some point the audit ledger had been moved by someone else from the file cabinet to the safe, but the safe hadn't been locked.
The Supervisors also found in paperwork the mention of a parking facility with revenue of $283,000. The township doesn't have a parking facility.
Montemuro also mentioned how they needed to go through and reorganize the filing system in the township office.
"This stuff had to be straightened out because we need to know where the problem was created and who did it."
At each month's meeting, Montemuro is going to go through each department and go over what kind of figures the township was short.
With all the changes to how the township is being run and how the township has been repaying the departments back the money that was lost. Montemuro stated that, "The Township is doing much better financially."
In other news,
David Hayward and Mark Ciovanu took the oath of office for the position of Fire Police for the Penn Forest Volunteer Fire Company #2.
The Board of Supervisors approved the motion to donate $600 to the Jim Thorpe Summer Recreation Program.
The board approved the motion to donate $1,000 to the Dimmick Memorial Library.
The board approved the motion to reduce the size of the Planning Commission Board from five members to three members.
The board approved the motion to appoint Kirk & Summa to complete the independent audit for the calendar year 2012.
The board approved the motion to appoint Kathryn Forry of Barry Isett & Associates as Zoning Officer.