More questions loom around forensic audit after Charles City work session

An Oct. 5 work session of Charles City County’s Board of Supervisors tried to qualm the fears and outbursts from several citizens as they provided a recap of the forensic audit. But instead of providing a few answers, it just resulted in more questions and frustrations.

Citizens sat as they observed county leadership and Charles City County Administrator Keith Rogers reviewed the document that allegedly had not resolved the issue of unanswered questions and missing information.

The forensic audit was summarized in ten procedures, with each pointing to an area that needed to be adjusted or were highlighted during the work session presentation.

The first procedure highlighted a review of material weaknesses from FY2024 Annual Comprehensive Financial Report (ACFR). Corrective action was taken in FY2025 to cash issues and bank reconciliation, with entries being adjusted related to Charles City County Public Schools.

Procedure two was a review of the Harrison Park project and grant compliance concerns. Current staff assessed the management, saying that the area needed improvement. An adopted Capital Improvement Plan (CIP) and project reporting could have prevented the issue according to the findings.

Procedure three centered around the county’s food pantry project. Current staff assessed the grantor, which indicated that noncompliance had not been reported and was closed out. The Department of Social Services (DSS) management oversight plans to correct the issue in the future by improving documentation recording including requiring services to assist more with low to moderate income individuals. Rogers commented that despite what rumors are being spread throughout the county, there are no plans to close the food pantry.

The fourth procedure was a review of the Market 5 procurement process and contract irregularities. Current staff and the audit said that an adopted CIP and project reporting could have prevented the findings.

Procedure five highlighted the senior citizen community development grant. The forensic audit noted that the grant complied with all required terms.

Procedure six focused on the COVID-19 funding and grant management. It was noted that the area needed areas of improvement and that an improved CIP and budgeting process could assist with that improvement.

The seventh procedure revolved around the Waste Management and landfill accounting. Current county staff has been working with legal staff according to Rogers to resolve revenue collect discrepancies. It was noted that the last two years may have seen the county may have lost more than 10 million dollars from Waste Management.

The eighth procedure highlighted the use of county credit cards. The department had issued credit cards, but that has been discontinued.

Procedure nine honed in on the county’s land transactions. The forensic audit spoke about the lack of document transactions, noting the county’s intended sell of the Neighborhood Facility Building. It appeared from documentation that the building was non-taxable and how taxes were being charged to a lessee. The county terminated the lease to avoid potential claims, with Rogers saying the county loss no tax revenue due to the property being undeveloped.

The last procedure focused on the food pantry and food bank spending. Budgeting practices and reporting were suggested to address the issues sooner. Enterprise funds will require a long-term solvency.

Brown Edwards LLC conducted the forensic audit, noting that 50 audit adjustments totalling more than $60 million may have been made. The company cited bookkeeping errors and other weaknesses, with projects such as grants for Harrison Park and ARPA funds not having invoices and documentation. The food pantry consisted of eight expenditures totaling more than $225,000 with no documentation, with the ledger missing $192,091 in records.

Market Five expenditures had an overrun of $822,353. The project received a grant close to $1.5 million, but the cost of construction and facilities increased Market 5’s overall cost to $2.32 million. The county could not identify the funding source for the overrun.

Auditors added they could not determine if COVID-19 funds were properly spent or returned, as well as the county collected all revenue from Waste Management. Approximately $74,000 in credit cards from 118 transactions did not have information to support if they were for business purposes. In previous public meetings, Rogers had said that documentation related to the transactions could have been shredded or burned due to it being a fire hazard. The county administrator also commented that he inherited the issue when he took over the role of county administrator a year-and-a-half ago and had no prior knowledge of it.

Additional issues include the county’s payment of $127,509 in reimbursable expenses for land transactions but were never able to recover them. Questions about a price increase of a parcel of land by $500,000 to $1.5 million as well as a second offer on the same property did not have any documentation. Finally, the audit found that between FY22-24, the general fund decreased by $8.28 million. Without bond proceeds, the reduction would have been $5 million more.

With no comment period at the meeting for the public, county leaders made very few comments, directing staff to continue to find out more information related to the issues. District 1 Supervisor Ryan Patterson emphasized to Rogers and county staff for more information and answers and to have them available and presented at a future meeting.