Riverhead Town this week received its completed 2008 audit, which has been long overdue, and the Town Board expects to formally accept it at Tuesday’s meeting.
That was all welcome news in Town Hall, but the town still is behind on its 2009 and 2010 audits, which are expected to be completed this year, according to Jeff Davoli of Albrecht, Viggiano, Zubreck and Company, the firm that has been simultaneously working on all three audits.
Mr. Davoli said the target date for the 2009 audit is June 30, 2011, and the target date for the 2010 audit is Nov. 2011.
The AVZ group also did the town’s 2007 audit, which wasn’t completed until December of 2009.
The audits must be completed in order for the town to issue bonds to capital projects for which it borrows money.
(Check back at RiverheadNewsReview.com or the March 17 newspaper for the report’s findings.)
Supervisor Sean Walter said the previous Town Board committed about $23 million to projects that still need to be bonded with long-term bonds.
In the interim, he said, the town borrowed the money from different accounts, but those accounts have to be repaid.
“It’s standard for towns to not bond things immediately, but I don’t think it’s standard that in 2008 and 2009, they spent the kind of money they did without going out to bond,” Mr. Walter said.
The 2008 audit was originally thought to be complete in November, but a mistake made by town employees was discovered that set it back a few more months, he said.
“It is of paramount importance that we get these audits done,” Mr Walter said.
In particular, he said, the sooner they are done and the town can issue bonds, the more the town will save because interest rates are rising and the town will, judging by the upwards trend, have to pay higher interest rates the longer it has to wait to issue bonds.
The lack of the audits could also negatively impact the town’s bond rating, which also will lead to higher interest rates, he said.
One of the reasons it took so long to finish the 2008 audit was because the town’s previous auditors did not inventory the town’s capital assets since 1998, Mr. Davoli told the board. It took about a year to straighten that problem out, he said.
Mr. Walter said the problems started prior to his taking office, and he said the 2007 and 2008 audits show a pattern of the prior board’s using one-shot revenues to help fund the running of the town.
It’s normal for a budget to be completed in about September of the following year, Mr. Walter said.