The Riverhead Fire District has inadequate procedures for hiring professional services and paid more than $780,000 to three professionals without a written agreement stating the rate of compensation, a recent New York State Comptroller advisory audit of the district found.
The state also found the district did not have enough control over remote access of the district’s data.
The audit, which examined the district for the period of Jan. 1, 2010 to Sept. 30, 2011, states the district didn’t solicit “competitive proposals” for any of the professional services that were examined. Three of those professionals were hired without a resolution or written agreement stating their rate of pay; the professionals were eventually paid $787,697, according to the audit.
Four of the remaining six professional service contracts that totaled $301,860 were paid out using agreements that included “open-ended terms.”
The lack of competitive bids for work, as well as unclear rates of pay, meant officials could not guarantee the services were “procured in the most prudent and economical manner,” according to the audit.
The Fire District is funded primarily through property taxes.
The state audit recommended the fire district use “competitive methods” to hire professional services and have written agreements for all professionals hired that includes the cost of the services.
In a written response to the state from the district’s chairman, Dennis Hamill, he said that the district is not required to put out competitive bids under General Municipal Law, and said the board “routinely” monitors the costs of the services, using rate schedules.
Many of the professional services must be completed in a short period of time, Mr. Hamill added.
“The nature of these services are such that they do not readily lend themselves to competitive procurement procedures,” Mr. Hamill wrote. “The Board is confident that professional services were obtained to provide the knowledge and skill needed in each instance at a fair price.”
In a response to the district’s letter, the state said that rate schedules “do not constitute or replace” written agreements.
The audit also stated the Board of Commissioners does not have a policy to “monitor or control remote access,” which allows certain service provider and managers to access the district’s computer system through the Internet.
According to the study, the holes in monitoring and controlling remote access could allow data to be manipulated and “could lead to the loss of important [financial] data and cause serious interruption to the District’s operations.”
The audit suggests the board should create a “comprehensive computer use policy” to protect their data from tampering, and better define who can access the district’s system.
Mr. Hamill wrote that the district has established a procedure to “closely monitor and limit” remote access, and will obtain access logs of who uses the system.
The district is not bound to follow the audit’s recommendations, comptroller’s office spokesman Brian Butry said, adding that the audit serves to bring potential issues to light.
It is up to each audited party to respond to the findings, he said.
“These are just recommendations,” Mr. Butry said “These audits are advisory in nature.”