In 2005, the Town spent approximately $45,000 to install water meters in an effort to more efficiently and equitably charge customers for water. However, the Town has not used the meters as a basis for charging users. Instead, a water maintenance operator reads accessible meters twice per year to monitor meter reliability and provide usage data. More specifically, Town officials told us that some meters have not worked since their initial installation, some are difficult to access, and the batteries are approaching the end of their useful lives. According to information provided by the Town, approximately 80 percent of the meters provide reliable readings. Officials have been working to remedy the meter situation for the past 12 years. As a result of these ineffective meters, Town officials bill customers water rents based on a flat-rate schedule that assigns charging units based on the number of households or businesses being served instead of metered usage. Although this methodology can take into account certain factors such as the physical size of the house/business, this is not as equitable as consumption-based billing. Based on the established rate schedule, a one-family residential customer that uses 50,000 gallons per year and another that uses 150,000 gallons per year are charged equivalent amounts. In addition, businesses are charged the same rate ($180 annually for a single business) regardless of their usage, which could vary significantly, depending on the type or size of business. Finally, the Board did not ensure that water rents were properly billed to users.

The Town Clerk, who acts as the appointed Tax Collector, did not remit property tax collections to the Town Supervisor in a timely manner as required by law. We found that by the end of the third week of January 2017 the Clerk had collected almost $1.7 million in taxes. However, the Clerk did not remit any tax collections to the Supervisor until the fourth week of January. The Clerk did not maintain the postmarked envelopes for tax payments received. Because postmarked envelopes were not maintained, Town officials are unable to determine the dates these payments were received and therefore cannot determine whether the correct penalties had been collected. The Clerk also does not prepare daily cash reports to reconcile to the transaction reports. Finally, the Clerk does not prepare bank reconciliations.

We found that collections were accurately recorded and deposited but deposits were not always timely. The Justice did not deposit collections totaling $36,755 in a timely manner. The Justice prepared accurate monthly bank reconciliations and accountabilities and cash disbursements were accurate. However, the Justice did not follow up on pending tickets listed in the New York State Department of Motor Vehicles (DMV) database. Finally, the Town Board did not perform an annual audit of the Justice's records and reports as required.

The purpose of our audit was to determine whether the six counties audited received and expended all emergency surcharge revenue from communication service suppliers (suppliers) and whether these counties used enhanced emergency communication (E911) surcharge revenues to improve their county’s 911 systems and operations, for the period January 1, 2014 through October 5, 2016.

The Town apparently has three sewer districts but the Supervisor recorded and reported all sewer operation revenues and expenditures as one special district. In addition, the Board does not adopt individual budgets for each sewer district. Capital costs are allocated to three sewer districts, but operating and maintenance costs are combined under one district. Town records, on a combined basis, show that as of December 31, 2016, the Town reported operating cash of $303,875, a capital reserve of $185,339 and unrestricted fund balance of $393,842 from sewer operations. The Town appears to be using Town Law provisions on sewer districts and sewer improvements as if they were interchangeable, which may have contributed to the confusion with respect to the accounting and reporting requirements for sewer districts and improvements.

The Board did not meet its oversight responsibilities. The Clerk-Treasurer performs all Village financial transactions with little Board oversight, including the billing and collection of water usage charges, the collection of real property taxes and the disbursement of Village funds. Although the Mayor dual-signs checks with the Clerk-Treasurer, no one reviews bank statements, canceled check images or monthly reports and reconciliations that the Clerk-Treasurer prepares. Furthermore, the Board did not perform or provide for the required annual audit of the Clerk-Treasurer's records. However, our reviews of the Clerk-Treasurer's operations did not disclose any material discrepancies.

Leave accrual records for five of the seven Business Office employees were overstated by a total of 272 hours. Vacation, sick and personal leave earned exceeded collective bargaining agreement (CBA) limits, and vacation and sick leave was accrued and/or used at rates other than specified in the CBAs. For example, the administrative assistant's vacation leave balance was overstated by 70.31 hours. The Library Director started 2016-17 with 84 hours of vacation leave and 14 hours of personal leave more than his CBA allowed. When Library officials do not adhere to CBA leave accrual requirements, employees could accrue and/or use more leave time than allowed, potentially increasing the Library's costs.

While the adopted general fund budgets included reasonable revenue estimates, appropriations significantly exceeded expenditures. The variance between appropriations and expenditures has increased from 5.9 percent in 2014-15 to 30.9 percent in 2016-17. Appropriations were overestimated by a total of $355,797 (20 percent) for the three-year period. In addition to the overestimated expenditure accounts, the Board included, but did not use, contingency appropriations of $10,000 in each of the three fiscal years. The Board also appropriated fund balance totaling approximately $297,000 to partially fund the 2014-15 through 2016-17 budgets. However, the Village did not use any of the annual appropriated fund balance amounts and instead realized operating surpluses (revenues exceeding expenditures) in each year due to the overestimation of appropriations. The Board's budgeting practices resulted in an unrestricted fund balance increase of $97,547 (25.7 percent) over the three-year period. As of May 31, 2017, the unrestricted general fund balance was 68.5 percent of the 2017-18 appropriations. When unused appropriated fund balance is added back, the Village's recalculated unrestricted fund balance in the 2016-17 budget was 82.8 percent of the next year's appropriations. Finally, Village officials have not developed a written multiyear financial or capital plan, which would help them address the use of fund balance and plan for future needs.

The Board did not provide adequate oversight of financial activities. Although the Department's bylaws do require its officers to annually inspect the Treasurer's records, the Board has not established written policies and procedures for cash disbursements or reviewed monthly bank reconciliations. Additionally, the Board did not annually audit the Treasurer's records. The Treasurer provides the Board with detailed monthly financial reports for revenues and expenses which include profit-and-loss statements for each fundraising event. However, receipt, deposit and disbursement dates were not recorded in the financial records. Finally, the Board did not establish written policies and procedures for debit card usage or review the bank statements and supporting documentation to ensure debit card transactions are for appropriate Department purposes.

Town officials overpaid health insurance buyout incentives to two employees by more than $4,900 and underpaid incentives to two employees by $1,680 during the audit period. Town officials also did not withhold employee contributions for health insurance coverage. As a result during the audit period, 11 employees were undercharged by more than $4,700 and seven employees were overcharged by $724. Finally, a former employee who retired in 2017 received, used and was paid for leave time to which she was not entitled, valued at $1,842.

Significant revenue and expenditure projections in the tentative budget are reasonable. The Village's budget includes $2.6 million for health and medical costs. However, we project the cost to be $2.7 million based on an average increase of 8 percent over the last five years. Therefore, the health insurance cost are underestimated by $100,000 in the 2018-19 tentative budget. The Village budgeted $4.2 million in water meter and sewer revenue. However, based on collections of water and sewer rents in prior years, we estimate the 2018-19 collections will be approximately $3.9 million, which is $359,000 less than budgeted. The Village faces potential increases in salary and wages for collective bargaining agreements (CBAs) that have expired and the possibility of retroactive increases when these agreements are settled. The tentative budget includes a tax levy of $11,016,788 which is $78,962 above the limit established by law. The Village Board should consider the potential financial impact of the settlement of the CBAs when finalizing the 2018-19 budget. In adopting the 2018-19 budget, the Village Board should be mindful of the legal requirement to maintain the tax levy increase to no more than the tax levy increase to no more than the tax levy limit as permitted by law, unless it properly overrides the tax levy limit.

The Board has not provided adequate oversight of water and sewer operations. The Board did not adopt written policies and procedures, adequately segregate the water and sewer billing and collection process, or implement mitigating controls. In addition, the Board-adopted fee schedule does not conform with the Village water code which requires the use of multipliers to base-rate charges for units with larger-diameter water lines. The Board also did not monitor water losses. We performed a reconciliation between the amount of water produced and billed quarterly by the Village from March 2016 through May 2017 and determined that an average of 35 percent of the water produced at the water plant is unaccounted for, or not billed. Based on quarterly averages for unaccounted-for water and the Department of Public Works Superintendent's calculation of the variable costs to produce 1,000 gallons of water, we estimate the production cost of the unaccounted-for water was approximately $12,900 annually. Finally, the Board has not developed a multiyear financial and capital plan.

The purpose of our audit was to determine whether town assessors were properly administering select real property tax exemptions for the period January 1, 2016 through December 31, 2016.

City officials need to improve their planning and monitoring of capital projects and the use of bond proceeds. Over the last five years, the City issued bonds totaling approximately $157.8 million for various capital projects and equipment. From fiscal years 2011-12 through 2015-16, the City has repeatedly borrowed without first exhausting prior bond proceeds. Overall, the City has issued bonds totaling $41.74 million for similar purposes, but only expended a total of $27.47 million. As a result, the City borrowed an excess of approximately $14.27 million as of fiscal year-end 2015-16. The City also issued bonds totaling $42.2 million over the last five years to pay for tax certiorari claims, a recurring expenditure that should be included in budgeted appropriations. Over the past five fiscal years, the City's annual debt service costs have increased by 18 percentage points and total indebtedness has increased by 10 percentage points. The Council and City officials also need to improve their budgeting practices and management of fund balance. City officials did not ensure accounting records were accurate, supported and complete and they did not consistently apply accounting principles or adequately account for financial transactions that affected the City's operations. Finally, City Council and officials have not provided adequate oversight of the City's financial operations. The Council and City officials have not established a fund balance policy. Quarterly financial reports do not provide Council with the resources to react to financial problems in a timely manner. The City does not have a long-term capital plan and the City's multiyear financial plan does not address eliminating debt issuances for recurring expenditures.

We compared the Town's operating funds budgeted revenues and appropriations with actual results of operations for the 2015 and 2016 fiscal years. We found the budgeted revenues and appropriations of the town-wide general fund for both years were reasonable as compared to the actual revenues and expenditures. However, the Board adopted unrealistic estimates of revenues and appropriations in the part-town general, part-town highway, sewer and water funds. For both 2015 and 2016, the Board also appropriated fund balance to fund appropriations in the part-town general, part-town highway, sewer and five of the six water districts. Due to the significant excess of actual revenues over the amounts budgeted and the actual expenditures being much less than appropriations, the amount of fund balance used to finance operations was much less than planned and, in some cases, none of the appropriated fund balance was used. As a result of the unrealistic budget estimates, the Board has not used appropriated fund balance to finance operations. This has resulted in the Town accumulating excessive fund balances in the part-town general fund, sewer fund and water districts 2,3,4 and 5. The fund balances in these funds increased by a combined $1,404,566 during 2015 and 2016. The Board did not develop and adopt a comprehensive, multiyear financial and capital plan. Such plans would be a useful tool for the Board to address the large fund balances in the Town's operating funds and to maintain a reasonable level of unexpended surplus funds at year-end.

District officials have not effectively managed fund balance. As a result, fund balance exceeded the statutory limit at the end of the past two fiscal years. While the reported unrestricted fund balance level at June 30, 2015 was within the statutory limit, the unrestricted fund balance levels at June 30, 2016 and 2017 exceeded the statutory limit by 2.94 percentage points and 6.73 percentage points, respectively. Additionally, the District accounted for certain proceeds in the general fund instead of the debt service fund, which caused the general fund balance to be overstated. However, even after making the adjustments for the proceeds, the unrestricted fund balance is still in excess of the statutory limit at the end of both the 2015-16 and 2016-17 fiscal years. The 2015-16 unrestricted fund balance is in excess of the limit by nearly 3 percentage points. Additionally, the unrestricted fund balance was over 5 percentage points in excess of the limit for 2016-17.

The Board does not request any financial information from the Clerk-Treasurer. Further, because the Clerk-Treasurer does not fully understand the accounting software, she cannot create accurate monthly budget-to-actual reports. During the budget development process, the Board reviews an expenditure summary created outside of the accounting software by the Mayor, adjusts appropriations based on this document and then adopts the budget. For fiscal years 2014-15 through 2016-17, the Board overestimated expenditures by an average of 15 percent. The Clerk-Treasurer does not provide the Board with historical budget-to-actual reports and does not inform the Board of expenditure lines needed throughout the year. For example, the Clerk-Treasurer recorded expenditures that were not approved in the 2015-16 adopted budget, including the Village's share of federal employment taxes and legal and professional fees totaling $13,000. Additionally, the Clerk-Treasurer filed inaccurate annual financial reports with OSC because she entered only the revenues and expenditures from the accounting software that had a corresponding code in the OSC software instead of all Village finances. For example, the 2017 annual financial report did not include utility expenditures totaling approximately $25,300. Finally, the Board does not perform the required annual audit of the Clerk-Treasurer's records and reports, further diminishing its ability to monitor the Village's financial operations.

Village officials have not set an appropriate tone for the protection of IT assets. Officials have not implemented appropriate policies and procedures to ensure IT assets and computerized data are properly safeguarded. The Village did not have written policies or procedures detailing the acceptable use of IT assets and the backing up of critical data. The Village also does not have a recovery plan or breach notification plan and has not provided adequate IT security training to employees. Consequently, there is an increased risk that productivity could be reduced, IT assets and information could be compromised and affected individuals may not be notified. In addition, the Village could suffer service interruptions and there could be a lack of individual accountability for various aspects of the IT environment.

The Board did not provide adequate oversight to ensure funding received by STE was appropriately used. It failed to develop clear and adequate policies and procedures or ensure that existing policies and procedures were followed. As a result of this weakened control environment, the former Director approved over $3,490 in credit card payments that did not have an invoice or receipt supporting the charge, and hired an employee in violation of Broome County Civil Service (BCCS) requirements at a starting salary that was $11,000 more than it should have been. Furthermore, the former Director and current Director did not provide the Board with comprehensive financial reports so it could properly oversee STE financial activities. Finally, the Board did not ensure that STE's goals aligned with those of the respective member counties. Because the Board failed to meet its fiduciary responsibilities, STE's financial operations is at higher risk of abuse or errors and the Board further jeopardizes its ability to foster economic development and improve the quality of life within the geographic region.

We reviewed the seven purchases totaling $261,439 that were required by policy to be competitively bid. We found that three purchases totaling $142,346 were not bid as required. District officials did not obtain bids for general insurance coverage in 2016 totaling $43,129 and 2017 totaling $38,138, and obtained quotes instead soliciting competitive bids for parking lot paving and concrete curbing totaling $61,080. The remaining four purchases, totaling $119,093, were purchased from valid State and County contracts. We also reviewed the 32 purchases totaling $163,885 that, in accordance with the policy required District officials to obtain two or three verbal or written quotes. Officials could provide no evidence of quotes for 28 purchases totaling $134,579. For the remaining four purchases totaling $29,306 for firefighting gear ($15,855), parking lot sealing ($7,000), fuel ($3,346) and firefighter jackets ($3,105), District officials used State and County contracts. We reviewed the seven purchases totaling $261,439 that were required by policy to be competitively bid. We found that three purchases totaling $142,346 were not bid as required. District officials did not obtain bids for general insurance coverage in 2016 totaling $43,129 and 2017 totaling $38,138, and obtained quotes instead soliciting competitive bids for parking lot paving and concrete curbing totaling $61,080. The remaining four purchases, totaling $119,093, were purchased from valid State and County contracts. We also reviewed the 32 purchases totaling $163,885 that, in accordance with the policy required District officials to obtain two or three verbal or written quotes. Officials could provide no evidence of quotes for 28 purchases totaling $134,579. For the remaining four purchases totaling $29,306 for firefighting gear ($15,855), parking lot sealing ($7,000), fuel ($3,346) and firefighter jackets ($3,105), District officials used State and County contracts.