By Jonathan Pleasant
Having just come through a crisis following freezing pipes and rampant leaks that basically shut down the entire water system a few weeks ago, more bad news became public knowledge this week for the Carderview Utility District in Butler. In a letter to the utility board from L. Rene Brison, Assistant Director for the State Office of the Comptroller of the Treasury, it was revealed that state officials conducted a special investigation of the districts last fiscal year, ranging from July 1, 2012 through June 30, 2013.
The report that followed did find multiple issues in the department, many of which have now been rectified with the sweeping changes of the past few weeks. Four main findings were identified most prominently, including improperly used grant funds, failure to obtain bids on purchases, inconsistent cutoff procedures, and issues with personal use of the utilitys vehicle.
Both of the first two items were directly involved with the construction of Carderviews new office on Rainbolt Street, which has been one of the most controversial developments at the district in the past few years. Investigators found that officials failed to obtain required bids during construction even though the departments policy has been to acquire competitive figures for any purchase exceeding $1,000. This was not a singular issue and was done multiple times throughout the project.
To correct the problem and hopefully reduce future issues, the board of directors did note that they have since changed their policy, raising the limit to $5,000 and requiring at least three bids. However, this does not help possibly the biggest infraction of the whole investigation, which involved the improper use of grant funds through the United States Department of Agricultures (USDA) Rural Development program.
The states report found that at least $6,400 in emergency funds was used to pay invoices related to the office construction. This led the USDA to de-obligate the remaining emergency funds although they did not require reimbursement of those monies already spent. As pointed out by comptroller officials in the report, the state does require the district to assign an independent party to review financial reports and expenses to ensure that they comply with the grant requirements.
While this was not done at that time, the Carderview Board has stated that in the future the utility will acquire the services of an independent, qualified individual to oversee all grant monies and sure all legal requirements are met.
The last two findings that investigators identified dealt more with day-to-day operations, such as appropriate uses of the districts vehicle. First and foremost, the district truck has no distinguishing marks identifying it as an official vehicle of Carderview Utility. Beyond that, former superintendent Walt Church admitted to using the truck for personal uses such as hauling firewood and produce and utilized a much more expensive commercial license plate rather than the standard $4 governmental plate.
Mileage log books were not maintained and Church did not report personal use of the truck as a fringe benefit on his taxes. In his defense, Carderview had no written policy prohibiting personal use. As for identifying the vehicle as an official truck, investigators did report that in Tennessee it is required that all capital assets be identified (tagged or marked), and recorded immediately following the purchase of such items. Vehicles and equipment (backhoes, mowers, etc.) should have the districts name or seal clearly displayed.
To account for these discrepancies members of the board pointed out that both Walt, and his wife Sharon, have resigned from their positions as superintendent and district manager respectively, and new steps have been taken to ensure that both the new manager and new operators understand that the truck is strictly for utility use and log books must be maintained for all mileage. Furthermore, new operator Odes Robertson is working on properly marking and identifying the truck as an official vehicle of Carderview Utility District.
The final item that investigators looked at dealt with a lack of consistent enforcement of the districts cutoff policy for delinquent accounts. Although policies were in place to identify what conditions needed to be met to cut off service, there never was a set time constraint, which consequently meant that it was never printed on the customers bills or service applications. In essence this means that actually determining an end service date was left up to the sole discretion of Sharon Church as the office manager.
Whether intentional or incidental, this led investigators to suggest cases of favoritism, most poignantly when they concluded that The investigation revealed the manager ordered some customers with delinquent accounts to be disconnected while allowing the continuation of service for other such customers, including family members. There were also discrepancies in the collection of fees, primarily dry tap fees that were collected on a monthly basis for some properties but not on others, including some owned by Church herself. As a result, the comptrollers office found that approximately $1,600 annually was not collected from more than a dozen dry taps not located in a subdivision or development.
As an end result recommendations were made to create a clear and consistent policy indicating cut off dates, defined grace periods, and uniformity of fee assessment. Ultimately the board agreed that these types of changes will be put into place and took direct responsibilities onto themselves to ensure proper enforcement.
Many of these issues have been ongoing, and whether simply though lack of clear procedure, neglect, or poor vigilance on the part of the Carderviews past commissioners, all were ultimately avoidable. The events of the past few months have been real eye openers, bringing changes not only in personnel but also to the board itself. All three commissioners, David Markland, Katie Harrell, and Doug Phillips are relatively new faces, and all seem more than willing to tackle the problems at hand.
Already some progress seems to have been made and although the states investigation stands as highlight to one of the low points in the districts history, it could also be one of the first steps to a much more efficient and professional future. Just like any government entity, Carderview must realign its focus and get back on track to serving it true purpose, providing an essential and reliable service to the people of Butler.
By Jonathan Pleasant