Audit: City of Snohomish over-claimed $125K for roundabout costs

SNOHOMISH — The State Auditor’s Office is wagging its finger at the city for double dipping and not properly doling out its money last year.

The state issued a finding after discovering the city had over-claimed $125,923 to be reimbursed by the U.S. Department of Transportation for the 15th Street and Avenue D roundabout in 2014 during a recent federal and financial audit. The money had already been repaid through the State Transportation Improvement Board.

Snohomish’s engineering department did not properly review reimbursement requests and research grant requirements, auditors said. Failure to comply with those rules may put at risk the city’s eligibility for future federal dollars.

The city responded to the audit finding, noting that it does not agree with it because the federal and state reimbursements were less than the total grant amounts authorized for the project. Snohomish officials pointed out that the roundabout project was a multiyear undertaking so the audit would have been more reasonable if it looked at the whole project instead of expenses only in 2014.

City Manager Larry Bauman said the finding was confusing because rules about how much the city is allowed to request for reimbursements during a calendar year were not in the federal grant agreement. Those regulations are included in another federal document.

“This was a learning process,” Bauman said.

Snohomish also received a management letter from the state during its accountability audit for the way it distributed shared costs for employee salaries and equipment among different city accounts in 2014.

The city was dinged by auditors for the similar issues during the past two audits.

Snohomish failed to provide the necessary documentation to support the way it distributed costs among various accounts to pay for projects and services in 2013 and 2012. It also did not do a reconciliation at the end of those years to make sure the money allocated agreed with actual costs.

Last year, Snohomish hired Jennifer Olson as its new finance director to replace Danny Weinberg, who retired. Olson has been working to improve the way the city doles out its money since she started in June 2014.

The state noted that the city made “significant improvements” last year from past audits. However, auditors suggested ways the city could improve to comply with state law and proper accounting procedures.

The state asked the city to put in place a plan to more accurately reflect how actual costs benefit various departments that provide money for projects and services.

The auditors also suggested the city reconcile at least annually the amount of money charged to various accounts with actual costs to make sure the amounts reflect the full value of services received throughout the year.

Amy Nile: 425-339-3192; Twitter: @AmyNileReports

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