The Board has developed a procurement policy that requires City officials to seek competition when contracting for professional services. However, the policy exempts City officials from seeking competition for certain professional services including lawyers, accountants, auditors, financial advisors, information technology advisors, real estate brokers, recruitment agencies for professionals, planners and landscape architects. In addition, City officials are not required to provide justification when seeking competition would not be in the best interest of the taxpayers. We reviewed the procurement of services from 30 professionals totaling approximately $12.4 million during the 2015-16 and 2016-17 fiscal years. City officials sought competition for services from eight professionals totaling approximately $3.2 million. However, City officials did not seek competition for services from 22 professionals totaling approximately $9.2 million. Based on the information reviewed, eight of the 22 professionals had been working for the City five years or more. For example, the City has been using the same vendor for audit services for at least 30 years.

The Board adopted a fund balance policy stating that the Town should adopt budgets with an unrestricted fund balance level of not less than 15 percent and no more than 100 percent of the total operating general and highway fund expenditures. The policy does not address any factors that would affect the level of fund balance, such as the timing of the Town's receipts and disbursements (cash flow), the volatility of revenues and expenditures, or the need to create reserve funds, and whether to include contingency appropriations in the annual budget. This information would help the Board and Town officials determine a reasonable level of fund balance to retain. Fifty-eight percent of the Town's budgeted revenues are derived from serving as a wind turbine host community. This revenue is normally received in November each year. Because the Town will have paid the bulk of its annual expenditures before this revenue is received, the Board should use a cash flow analysis to estimate a reasonable amount of unrestricted fund balance to maintain each year to help fund these costs. The Town Supervisor told us that the Town imposed a tax levy in 2016 and 2017 because officials believed the Town would deplete operating cash before it received the wind energy revenue in November. We compared the 2016 and 2017 budget and did not identify significant decreases or depletion of any other revenue sources. The Town had sufficient cash flow and imposed a tax levy that was higher than necessary. Finally, the Board and Town officials did not develop a multiyear financial plan. Had such a plan been in place, it would have been a useful tool for the Board to use to identify revenue and expenditure trends and consider the impact of budgeting decisions on future fiscal years.

The Supervisor is not adequately fulfilling related financial duties. The Supervisor did not ensure accounting records were accurate and complete and did not deposit receipts in a timely manner. We found that 93 percent of receipts reviewed totaling $1.47 million were deposited, on average, 35 days after receipt. The Supervisor was unaware of the statutory requirement for deposits and only made one deposit at the end of each month. The Supervisor also misplaced two checks totaling $2,015 from the Town Justices. Finally, the Supervisor has not submitted an annual accounting to the Board for fiscal years 2015 and 2016 and has not provided the public accountant hired to audit the books and records with adequate information. As a result, the 2015 and 2016 annual audits have not been performed.

We compared budgeted appropriations to actual expenditures for 2012-13 through 2016-17 and found that District officials overestimated appropriations by over $43 million. Because annual budgets contained significantly overestimated appropriations each year, it appeared that the District needed to increase its tax levy and use appropriated fund balance to close projected budget gaps. For the same period, the Board increased the property tax levy by a total of $7,982,396 or 12.4 percent and appropriated a total of nearly $27.2 million of fund balance. However, only $1,375,819 of appropriated fund balance was actually needed and was only needed in one year of a five-year period. Due to the inflated estimates for certain appropriations, the District had operating surpluses in four of the last five years totaling $23.4 million. Furthermore, the Board did not adopt a fund balance policy to outline the desired level of year-end fund balance to be maintained by the District. As a result, the total fund balance increased to $58.9 million as of June 30, 2017. While $22.9 million of the June 30, 2017 fund balance was restricted in reserve funds, the unrestricted fund balance grew from $17.3 million as of June 30, 2013 to $27.7 million as of June 30, 2017. As a result, the unrestricted fund balance exceeded the statutory limit. However, when the appropriated fund balance not used and excessive or unnecessary reserves are included, the District's recalculated unrestricted fund balance ranged from 17.12 to 24.26 percent of the ensuing year's budget, exceeding the 4 percent statutory limit in each of the last five years. Finally, six reserves were overfunded by $8 million.

The Town did not procure goods in accordance with the competitive bidding requirements. We found that the Town did not procure two items totaling $108,558 in accordance with GML. These purchases consisted of $40,387 for a 2017 pickup truck and $68,171 for diesel fuel during our audit period. We also expanded our review of diesel fuel purchases back to January 1, 2015 and found the Town did not procure diesel fuel totaling $56,395 during the 2015 fiscal year in accordance with GML. As a result, the Town expended $21,287 more than necessary for diesel fuel purchases. In addition, the Clerk did not record all collections received in a timely and accurate manner. Cash deposits were not supported. Monthly reports and remittances were not accurate and timely. Accountability analyses were not prepared by the Clerk and she had a $1,100 unidentified balance in her Clerk bank account as of July 31, 2017. Finally, the Board did not audit or obtain an audit of the Clerk's records and reports for the 2016 fiscal year.

The building selected by the Board appears to meet all of the needs identified on the School's facilities requirements checklist. However, a sufficient cost-benefit analysis of this or other buildings was not completed. We analyzed the six buildings included in the comparison table that the School had toured, as well as one building that was included as a comparison in the appraisal of the selected building, to determine if the School could have acquired a comparative building for a lower price. While there are certain other factors to be considered, such as site location and the facilities included (e.g., parking, play area) for perspective, the School's comparison of available buildings did not include sufficient information on such factors. Only three of the buildings included on their comparison mentioned facilities such as parking, green space and location. Due to the lack of a detailed analysis based on these multiple factors, we performed an analysis based on square footage and cost per square foot. It appears that the School could have paid between $14 and $39 per square foot for other buildings ranging in size from 46,000 to 120,000 square feet, compared to the nearly $51 per square foot actually paid for the 61,000 square foot Hertel building that was selected. In just looking at cost, if one of these buildings had been selected, the cost per square foot would have been between $12 to $37 lower.

Authority officials did not adhere to the procurement policy regarding obtaining quotes for purchases and public works. During our audit period, Authority officials did not obtain quotes for public works projects totaling $18,762 and purchases contracts totaling $10,680 or solicit requests for proposals (RFPs) for professional services totaling $26,754. Authority officials did not adopt comprehensive IT policies or a disaster recovery plan. In addition, Internet use is not monitored and the server is not in a secured area.

The District's IT policies and procedures were not adequate. Although the District had computer/Internet use policies, they have not been revised for changes in technology since December 2006. In addition, the Board has not adopted policies and procedures for personal, private and sensitive information (PPSI) data classification, wireless security, managing mobile computing and storage devices, and cybersecurity training. The District also does not have written procedures for granting, changing and terminating access rights to the networked computer system and to specific software applications. The District does not provide, or require employees to attend, any formal cybersecurity awareness training. District staff were able to access websites unrelated to District activities, such as games, hobby sites, job searching, social media, shopping and travel. This occurred because District officials did not sufficiently configure the web filtering software to block access to these sites.

We found that although the Board has not developed formal written fund balance and reserve policies or comprehensive multiyear financial and capital plans, it has used available fund balance and reserves, as appropriate, to avoid significant real property tax increases. The Board adopted realistic budgets from 2014 through 2016 and real property tax levies have remained relatively stable. The Highway Superintendent created a multiyear equipment replacement schedule for the Board's use when budgeting. Town officials appropriately used the machinery capital reserve to replace equipment as planned. We commend Town officials for implementing pertinent components of a multiyear plan and maintaining stable fund balances and reserves while keeping real property taxes relatively flat. However, officials could improve overall financial management and improve transparency if they adopted comprehensive multiyear planning.

While the City's budgets were realistic, general fund budgets for the period reviewed were not structurally balanced. Specifically, although variances between budgets and actual results for 2016 were within 4 percent for each operating fund, the City's general fund continually relied on a $300,000 annual fund balance appropriation to finance operations. Furthermore, overestimated revenues contributed to the use of more fund balance than the budget appropriated. Because of the revenue shortfalls, the City issued a $1 million revenue anticipation note (RAN) in November 2016. The City's fund balance declined during fiscal years 2014 through 2016 for each of the operating funds, and the sewer fund had a deficit fund balance at the end of all three years. The Director did not provide budget-to-actual reports to the Council on a regular basis; rather, he provided reports upon request. Although the Mayor had access to the City's financial software, there was no support to demonstrate how frequently the Council reviewed and analyzed budget-to-actual reports. The City also lacked multiyear plans. Finally, the City's accounting records did not agree with the annual financial reports.

District officials did not use a formal timekeeping system, instead they relied on the Manager's observations of employees' time worked. Officials did not maintain time records for the Treasurer's or Secretary's time worked. For all other full-time employees, the Manager kept a handwritten diary that included, among other information, his observations of when employees started and ended work each day, worked overtime or used accrued leave. When the Manager was not at work, no other District official maintained this diary. Additionally, time worked by part-time dispatchers was based on the time each dispatcher logged into the dispatching software. The end of a dispatcher's shift was calculated when the next assigned dispatcher logged into the software and was not necessarily when the previous dispatcher left work.

The Board has not developed or implemented any parking ticket collection policies. Although Village officials implemented procedures for collecting parking fines, the procedures are limited to the contractor sending five delinquency notices and reporting non-payers to the Department of Motor Vehicles. As a result, the number of unpaid parking tickets more than doubled, from 1,637 in 2012 to 3,256 in 2016. The Board has not developed benchmarks and the agreement with the contractor does not include a performance benchmark. The Village parking ticket collection rate was approximately 84.2 percent through the end of our audit period. Despite this level of collection, the Village still has approximately $1.8 million in cumulative unpaid parking tickets outstanding as of September 30, 2017, including 31,870 tickets that remain outstanding from before January 1, 2012 with associated fines and penalties totaling more than $660,000. These tickets remained on the contractor's report of unpaid parking tickets and no additional actions were taken to collect these amounts.

The Board did not provide oversight or ensure the Treasurer's duties were adequately segregated or monitored. The Treasurer's duties related to cash receipts and disbursements were not adequately segregated, which resulted in the Treasurer performing incompatible duties such as collecting cash, recording receipts, writing checks and preparing bank deposits. The Treasurer did not maintain accurate accounting records or prepare and provide the Board with monthly financial reports. Company members voted on a resolution which established how the Company would use the foreign fire insurance funds. The Board has not implemented procedures to address the review of claims or outlined the documentation that should accompany a purchase. Although the disbursements tested appeared to be for legitimate Company purposes, there were a significant number of disbursements that did not have documentation to substantiate their legitimacy. Further, the Treasurer stated that an annual audit has not been performed.

The Department has 14 bank accounts covering Department, emergency squad, bingo and bell jar operations. Records for the bingo and bell jar accounts are maintained by their respective Treasurers and list all disbursements and receipts. However, the Department Treasurer does not maintain complete accounting records of disbursements and receipts or running cash balances for the Department and squad accounts. In addition, bank accounts are not reconciled and reported to the membership. Instead, the Treasurer reports unreconciled cash balances from the bank statements for the Department and squad accounts and does not include receipts and disbursements. Furthermore, the Treasurer's report does not include bingo or bell jar activity. The Department generally had controls to safeguard cash receipts by limiting access to cash and reconciling cash to reported counts and paid bell jar tickets. However, the cash collected from bingo sales is not dual counted or reconciled to bingo sales prior to deposit. Finally, the audit and approval of bills was not properly documented.

The County's financial condition has been deteriorating for the last several years. This occurred because of planned operating deficits and expenditures outpacing revenues, which ultimately consumed fund balance. As of December 31, 2016, fund balance in the general fund was 2.7 percent of 2016 gross expenditures, which was among the lowest for counties in the State. At this rate, the County's current and future results of operations must be precisely as budgeted (or better) and spending monitored to stay within budget, or fund balance may be depleted at the end of 2017.

The Sheriff's Department did not properly account for and manage the inmate and commissary accounts. The former Sheriff improperly transferred approximately $33,800 from the inmate bank account to the civil bank account. Additionally, the former secretary did not periodically account for and deposit all commissary surcharges in the separate commissary bank account as required and instead issued a check from the inmate account totaling approximately $23,900 in November 2015 to apparently correct for the previously unmade transfers to the commissary account. The former Sheriff did not review the bank reconciliations prepared by the secretary and neither the former nor the current Sheriff prepared monthly accountabilities for the inmate and the commissary accounts to reconcile the bank account balances with the outstanding liabilities (e.g., money owed to inmates or vendors). We also performed an accountability for the inmate account and found that as of February 28, 2017, the Department had approximately $5,400 more in this account than the known amounts owed. Further, Department officials incorrectly made disbursements from the inmate account for shared expenditures, such as cable bills, and made disbursements, such as personal inmate telephone charges, from the commissary account.

District officials have effectively ensured the accuracy of employee salaries and wages paid by instituting comprehensive practices for processing and verifying payroll payments. However, we found instances where District staff made incorrect contributions to employee 403(b) accounts and made errors calculating the employee/retiree share of health and dental premiums. The District paid $114 more for 403(b) matching contributions for 14 employees during a sample pay period we tested in December 2016. Over 20 pay periods in the year, this could result in $2,270 of District overpayments for 2016-17. The District also contributed about $55 too little for seven administrators during the December 2016 pay period we tested. Over 20 pay periods, this could amount to $1,091 in District underpayments for 2016-17. In addition, we found errors with health and dental insurance contributions totaling $628.

The County has adopted a procurement policy that includes the bidding requirements of General Municipal Law (GML) and procedures for goods and services GML does not require to be competitively bid. The County procured goods and services in accordance with GML and the County's procurement policy. We commend County officials for effectively managing the procurement process.

While District financial activity was properly recorded and disbursements were authorized, the Board needs to improve its oversight of the Treasurer's financial duties. The Treasurer performed all financial duties including receiving and disbursing cash, signing District checks, conducting bank transfers, maintaining the accounting records and preparing bank reconciliations with little or no oversight. The Board reviewed a monthly report prepared by the Treasurer, which includes the previous month's balance for each bank account, internal bank to bank transfers, interest earned, revenues collected, claims paid and ending bank balance. However, the Board did not request monthly financial reports, such as budget-to-actual revenue and expenditure status reports, trial balance reports, bank reconciliations, bank statements or canceled checks to review, which could serve as a tool for the Board to perform oversight duties. The Board also did not ensure that all claims were adequately supported, properly authorized and for valid purposes. Finally, the Board also did not annually audit the Treasurer's records.

The Village's general fund balance decreased from $859,588 to $379,387 from 2013 to 2017. The general fund balance was reduced primarily by interfund transfers from 2014 through 2016 to the sewer fund totaling $400,000. The Board also appropriated fund balance in 2014 and 2016 to help finance operations. The Board has not developed a comprehensive fund balance policy, which would establish clear guidelines for fund balance levels, as well as appropriate usage of fund balances. Without reasonable fund balance levels, the Village may not have adequate cash flow to meet Village needs. In addition, from 2014 through 2017, the total short-term debt remained consistent at approximately $2.5 million annually, approximately 32 percent of the total budget. In fiscal year 2017, the total short-term debt increased to nearly $3.4 million. Total debt (long and short-term) increased to over $5.2 million. A heavy or ongoing reliance on debt could indicate the Village has cash flow issues that are not being resolved. Finally, the Board does not have a comprehensive multiyear financial plan. Such a plan can be a valuable resource for the Board and officials and would allow them to make more informed financial decisions.