Duties in the Civil Division office have not been adequately segregated. Additionally, although the mechanical signature devices are controlled by the supervisor and locked in the Division safe, the supervisor's signature is automatically printed on the checks without any required prior authorization. Further, the manual's guidance regarding check signatures is out-of-date and does not reflect the current Division practices. Because of these control weaknesses, we compared the information entered into the recordkeeping system with the original court documents provided to the Division during May 2018. Of the 45 income executions recorded that month, we found that proper supporting documentation was maintained for all the cases. In addition, the recorded judgment amounts matched the court documents for all the cases and the fees and mileage retained were correctly calculated. We also found that all 963 recorded cash receipts totaling $699,653 for the month agreed with the amounts deposited and the deposit compositions matched the recorded cash receipts. In general, deposits were made in a timely manner based on the number of days between the check date and the deposit dates. Furthermore, we reviewed all disbursements made during June 2018 and found that all outgoing payments agreed with incoming cash receipts and all were for appropriate purposes.

Of the 224 granted exemptions that we reviewed totaling approximately $6.2 million of assessed value, 136 exemptions (61 percent), valued at approximately $3.8 million in assessed value, lacked one or more pieces of supporting documentation to verify their eligibility and/or were incorrectly granted. One property owner did not meet the eligibility requirements to receive agricultural building exemptions. As a result, the property owner incorrectly received $15,231 in tax reductions. In addition, agricultural building exemptions that were granted for the construction of two buildings were not supported. As a result, the property owner may have incorrectly received $80,126 in tax reductions. Finally, the Assessor did not have any documentation on file for four properties receiving eligible funds exemptions or four additional properties receiving senior citizens exemptions. As a result, the owners may have incorrectly received $2,551 in tax reductions.

The Yonkers Public School District's budget request is $645.3 million for appropriations, which has a budget gap of at least $17.6 million for pending additional State funding that is not supported. The District has appropriated $7.8 million of projected unassigned fund balance at the end of the 2018-19 year; however, this appropriation must be approved by the Board of Education and City Council before it can be used. If the fund balance is not approved or available at year end, the District could have a $7.8 million budget gap. The District's budget request includes a $4.2 million appropriation for the purchase of textbooks, software and equipment. However, the City's capital budget also includes up to $4.6 million for this acquisition. These are recurring District expenditures and should be included as an appropriation in the annual budget. The City continues to rely on nonrecurring revenue, such as specialized State aid and fund balance, to balance its budget. Revenue estimates for metered water sales, sewer rents and income tax surcharge may not be achievable. The City will incur additional debt and interest costs by bonding the cost of tax certiorari claims instead of financing them through the operating budget. The appropriations for police overtime and bond anticipation note (BAN) and revenue anticipation note (RAN) interest could be underestimated. Under the proposed budget, the City will have exhausted 89.3 percent of its constitutional tax limit. We caution the City that if property values do not increase, its ability to increase taxes may be reduced in future years. The water fund may be subsidizing the general fund for services not related to the water fund by as much as $3.7 million.

The Board and Village officials did not establish adequate internal controls over Department cash receipts. The Board did not adopt written cash receipt policies, cash receipt duties were not properly segregated and the Supervisor did not adequately oversee the cash receipt function. As a result, the attendant had almost complete control over the cash receipts without adequate oversight. From August 1, 2011 through November 30, 2017, we reviewed approximately 2,000 receipts issued by Department employees for cash collections totaling approximately $264,000. We estimate that additional unreceipted cash of $14,000 was collected for swim gate fees during this period. However, the attendant reported cash collections of approximately $107,700, a cash shortage of more than $170,000. During this period, less than half the amount of cash receipted by employees was remitted to the Treasurer. OSC's Division of Investigations in conjunction with the Erie County District Attorney's Office jointly investigated this matter. In October 2018, the attendant admitted stealing more than $150,000 from the Village and altering public records from 2011 through 2017. She pleaded guilty to grand larceny, false filing and official misconduct in October 2018 and was sentenced in March 2019. As part of her sentence, she repaid the Village $156,374.

The proposed budget includes appropriations of $85.7 million and revenue estimates of $40.7 million. For the fiscal year ended June 30, 2018, personal services and employee benefits accounted for 90 percent of revenue. This leaves little to finance operations and maintain infrastructure; yet the City continues to incur debt to finance recurring costs. The proposed budget includes revenue estimates of $4.5 million in metered water sales and $5.5 million in sewer rents. However, the City Council has not yet authorized the budgeted increases in rates that are needed to realize these revenues. The proposed budget includes appropriations of $1.9 million in termination salary payments, yet expenditures have averaged $2.2 million over the last three years. City officials only partially implemented the Comptroller's recommendations in our May 2018 review of the 2018-19 proposed budget. They did not modify the proposed budget to reflect a budgeted increase in refuse and garbage rates until June 2018.The City Council authorized $2.2 million in debt to cover termination salary related expenditures, planned to be issued prior to the end of the 2018-19 fiscal year. Continued reliance on debt to finance operations perpetuates the City's weak financial condition. The City's initially proposed budget includes a tax levy of $45,092,654 which is $3,218,797 above the limit established by law. On May 7, 2019, the Council adopted a resolution authorizing the City to override the tax levy limit.

The Board reviewed and approved purchases before they occurred and adequately segregated duties by hiring a third-party bookkeeper to reconcile all Department bank accounts monthly. Although Department officials told us they actively seek the best price for goods and services, they did not maintain sufficient documentation to support their statements. Also, the Board did not adopt policies and procedures to govern procurement. We reviewed all 215 purchases totaling approximately $155,500 during the audit period and found that only one of seven purchases exceeding $5,000, for $5,775 for an industrial washing machine, had documentation of competition being sought. Finally, the Board did not adopt a code of ethics to set forth standards of conduct, and certain officers did not disclose in writing their apparent “interest” in certain contracts the Department entered into, as required.

The Department needs to improve its cash receipt and disbursement procedures. The Board President (President) did not publicly disclose, in writing, his deemed interest in the oral agreement between his business and the Department. Based on the oral agreement, it appears that the President's business owed the Department at least $3,500. In addition, Department officials did not ensure collections totaling $75,200 from fundraising activities were adequately supported. Finally, the Treasurer did not keep adequate documentation for 55 disbursements totaling $38,500.

The Board did not audit individual claims before payment. However, our review of 59 claims totaling $1.2 million paid during the audit period showed that these claims generally appeared to be valid expenditures. Village officials were unable to provide documentation to show that they obtained the required number of bids, quotes or request for proposals (RFPs) for seven purchases totaling $102,494, as required by the procurement policy. In addition, while New York State Village Law authorizes certain claims to be paid in advance of audit, 14 claims totaling $380,938 were paid before audit that were not authorized for such prepayment. Finally, Village officials paid 40 credit card charges totaling $7,187 (of 103 charges totaling $16,999 incurred during the audit period) that were inadequately supported. Credit card purchases included nine charges for office supplies totaling $1,010 that were not adequately supported. Additionally, officials paid sales tax totaling $296 on the credit card purchases.

The former Clerk did not deposit Clerk fees intact. While total collections recorded in the system for each deposit generally agreed with the total amount deposited, we identified seven instances when the composition of total cash and checks recorded in the system did not agree with the composition of total cash and checks deposited. We identified a total cash shortage of $164 as a result of seven unrecorded checks substituted for recorded cash collections. In addition, the former Clerk did not adequately support collections and the form of payment was not always recorded. Although a receipt was sometimes printed from the system at the time of the transaction and maintained, this receipt was inadequate because the form of payment was not indicated and the number assigned by the system was not documented. For the 2016 and 2017 tax years, we reviewed 301 real property tax bills totaling $514,491 deposited by the former Clerk and found that collections for 76 bills totaling $115,725 (25 percent) were deposited between two and five days after receipt instead of within 24 hours as required by Town Law. In 2018, the current Clerk deposited collections for all 30 tax bills reviewed totaling $50,459 within 24 hours as required. Finally, receipts for the 2016 and 2017 real property tax collections and documentation to substantiate the date real property taxes were received could not be located.

Although department supervisors review and sign timecards, there are no procedures to provide a review of timecards for office staff and supervisors. In addition, Village officials do not review the payroll clerks' payroll calculations or entered data for accuracy before payroll is finalized. Therefore, we reviewed payroll records for seven permanent full-time employees who were paid salary payments, totaling $145,307 for the period October 1 through January 1, 2018, which covered 14 payroll periods, to determine whether hours worked, as recorded by the time clock, were accurately reflected on the payroll registers, salaries and pay rates agreed with those authorized by the Board, leave time used was deducted from the leave balances and gross salaries were correctly calculated. Employee salary and rates paid generally agreed with those included in the adopted budget and leave was accurately deducted from employee leave balances. However, the Board did not audit and approve the building permit fees paid to the building inspector. In addition, the Board underbudgeted the amount paid to the building inspector by an average of $45,214 (113 percent) from 2015-16 through 2017-18. As a result, the budget did not reflect realistic appropriations for the building inspector's permit fees each year, based on recent trends.

The Supervisor delegated his financial responsibilities to another employee, the bookkeeper, and failed to provide oversight. The bookkeeper collects, records and deposits receipts and makes online transfers without oversight, including inappropriately making transfers directly from the bank accounts of the independently elected Town Clerk and Justice. She also performs Automated Clearing House (ACH) debits, initiates online bill payments and debit card payments without authorization from the Supervisor, prepares and prints checks from the check stock kept at her home, and records disbursements in a computerized accounting program on her personal computer. Although the bookkeeper completes monthly bank reconciliations, she does not provide the reconciliations and bank statements to the Supervisor or Board for review or provide adjusting/correcting entries to the Supervisor for approval. All online transactions, recording of financial transactions, and preparing of the monthly Supervisor's financial reports to the Board are performed on the bookkeeper's personal computer. As a result, we could not assess the control environment of this computer. Finally, the bookkeeper made numerous recording errors that she eventually corrected with unapproved adjusting journal entries. Because these errors were not timely identified or communicated to the Supervisor, the Supervisor's monthly financial reports presented to the Board were inaccurate and unreliable.

While School officials generally sought competition for purchases of goods and services that exceeded the $20,000 threshold, they did not regularly seek competition for purchases costing less than $20,000. We reviewed purchases that could have been made from a State contract vendor or may have benefitted from seeking other competition. While officials purchased books from the State contract vendor, our review of office supplies purchased from two vendors disclosed that the School was not using a State contract vendor for these purchases. School officials also did not establish adequate policies and procedures for credit cards resulting in the circumvention of purchasing policies and unnecessary waste. The School could save approximately $4,700 by purchasing items from government contracts and using the School's tax exempt status. Officials also should fully comply with Dignity for All Students Act (DASA) requirements. While a code of conduct is posted on the School website, the code is not distributed annually and does not include provisions prohibiting discrimination, procedures for reporting violations or the Dignity Act Coordinator's contact information.

Over the last three years, the school lunch fund incurred operating deficits totaling over $151,500, excluding transfers from the general fund totaling $166,000. Furthermore, because of interfund loans, the school lunch fund owed the general fund almost $376,000 as of June 30, 2018, which is unlikely to be paid back. As of June 30, 2018, unrestricted, unappropriated fund balance was approximately ($330,800). From 2015-16 through 2017-18, the cost-per-ME (meal equivalent) increased over 4 percent while revenue-per-ME increased 11 percent, excluding transfers from the general fund; however, the costs continue to exceed the revenues by 27 cents per ME as of 2017-18. We also prepared a meals per labor hour (MPLH) analysis for each cafeteria for 2017-18 and found the high school's MPLH was within industry standards while the elementary school's MPLH was below industry standards. We also compared milk purchased through the Capital Region BOCES cooperative bid for three months and found that the District could have saved almost $2,000 in those three months if the purchases were made through the Office of General Services (OGS) cooperative bid. We commend District officials for identifying opportunities to increase revenues while simultaneously increasing participation and sales. However, without doing periodic analyses of school lunch fund operations and ensuring officials are obtaining the best price for food and supplies, the school lunch fund's current level of reliance on general fund subsidies will continue.

District officials do not have a procedure in place to reconcile the gasoline inventory. Although logs are completed and tanks are secured, officials have not monitored delivery or usage by reconciling such activities. Further, each vehicle has its own manual gasoline use log but no one reviews them or reconciles the amounts used to delivery tickets for reasonableness. Because of these weaknesses, we compared the gasoline dispensed per the pump meter readings and usage logs to the gasoline purchased for the audit period. Between January 2016 and May 2018, the vendor delivered about 8,000 gallons costing roughly $17,000. Based on gasoline tank meter readings, District officials and employees pumped about 7,900 gallons of gasoline. However, only 7,440 gallons were logged - a difference of 460 gallons of unaccounted for gasoline. Using the District's average price of $2.02 per gallon, this unaccounted for gasoline inventory cost the District about $930. In addition, of the 456 manual gasoline log entries, 57 had errors or omissions (13 percent). Finally, had the District obtained gasoline using a New York State Office of General Services contract, it could have saved at least $2,660.

The Board has not reviewed the procurement policy annually or updated it as necessary, nor does the policy provide guidance for obtaining professional services. We found Town officials were generally unaware of the requirements in the policy. As a result, Town officials did not adequately safeguard highway assets, including scrap metal, which may have resulted in at least $1,700 in scrap metal proceeds being used for inappropriate expenditures. In addition, officials did not monitor highway fuel use, resulting in 531 gallons of gasoline totaling over $1,100 that could not be accounted for. Officials also did not competitively procure goods and services, including motor oil and tires, resulting in potential overpayments of $4,500.

The District's length of service award program (LOSAP) policy is not consistent with New York State General Municipal Law (GML) as the policy does not award points for certain activities in accordance with GML because the policy does not award the correct amount of points for certain activities, including: training courses, drills, elected/appointed positions, meetings and miscellaneous activities. In addition, although District officials established adequate procedures over LOSAP recordkeeping, they did not always ensure that records of individuals' activities under the point system were complete, accurate and properly documented. The 2016 and 2017 LOSAP records for 27 members did not sufficiently support 322 points awarded. Also, four members may not have earned the required 50 points to be credited for a year of service.

Based on the results of our review, we found that the significant revenue and expenditure estimates contained in the tentative budget were reasonable. However, our review disclosed certain findings which should be reviewed by the Board for appropriate action. We estimate the 2019-20 water and sewer collections will be approximately $4.3 million, which is $134,000 less than budgeted for water revenues and $256,000 less than budgeted for sewer revenues. The Village also faces potential increases in salary and wages for two expired collective bargaining agreements (CBAs) and the possibility of retroactive increases when these agreements are settled. We recommend that the Village Board consider the potential financial impact of the possible shortfall in water and sewer revenues as well as the settlement of the CBAs when finalizing the 2019-20 budget. Finally, the Village's tentative budget includes a tax levy of $12,281,362 which is $1,078,728 above the limit established by law. In adopting the 2019-20 budget, the Board should be mindful of the legal requirement to maintain the tax levy increase to no more than the property tax levy limit as permitted by law, unless it properly overrides the tax levy limit.

The Board did not segregate the Clerk-Treasurer's duties or ensure sufficient compensating controls were in place to oversee her work. The Clerk-Treasurer is responsible for all aspects of the financial and recordkeeping duties, including depositing money (e.g., real property taxes and sewer fees), writing checks, making bank transfers, processing payroll, recording transactions in the accounting records and reconciling bank accounts. The Board did not adequately oversee the Clerk-Treasurer's work, audit claims before approving them for payment or require annual audits of the Clerk-Treasurer's records and reports. We also identified various recordkeeping deficiencies, which impacted the Clerk-Treasurer's ability to provide the Board with timely and accurate financial reports. In addition, the Treasurer did not file annual financial reports (AUDs) with the State Comptroller's Office or the Board in a timely manner. Finally, Department of Public Works employees received payroll payments totaling approximately $4,000 over a six-month period that were not supported by timecards.

We reviewed 50 properties with assessment values totaling approximately $101.5 million that were granted property tax exemptions totaling approximately $33.2 million for 2017. We determined that eight properties (16 percent) with assessment values totaling approximately $15.8 million had exemptions totaling approximately $5 million for which $583,418 of the exemption amount was not properly granted. For example, the Assessor granted four woodland exemptions for rented agricultural parcels with $40,028 in assessed value that did not meet the woodland eligibility requirement. In addition, the Assessor granted three agricultural exemptions with assessed values of $543,390. Two of these exemptions lacked proper documentation and the remaining one was granted even though the 10-year exemption term had expired in 2013. Furthermore, we found that the Assessor did not grant a farm woodland (5.42 acres) exemption credit totaling $2,168 in assessed value to one property when she calculated the exemption amount.

County officials obtained professional services from 63 providers who were paid approximately $7.97 million from January 1, 2017 through July 23, 2018. We reviewed payments to all these providers and found that payments to 26 providers were for assigned counsel services and payments to 13 providers were for early intervention therapy. These services did not require competition because the rates paid are established by law and/or the State. Of the remaining 24 professional service providers, officials did not seek competition for aggregate purchases from nine vendors totaling approximately $746,000 or from 14 professional service providers totaling $2.7 million. Officials also allowed the credit card company to directly withdraw 25 payments totaling $77,615 from the bank account. Finally, the Legislature delegated its claims auditing responsibilities to the Clerk of the Legislature. We found that the Clerk of the Legislature did not audit 26 claims totaling $76,804 before payment and approved 25 claims totaling $50,439 that were not adequately supported.