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Audit finds ‘no daily oversight of the municipal garage’

02/03/2016 6:00 AM |

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Riverhead Town’s municipal garage needs better oversight, according to a report from the town’s Independent Audit Advisory Committee.

The municipal garage, which has just four employees — three mechanics and a secretary — was placed under the control of the town engineering department last year as part of a consolidation of duties brought on by the retirement of several department heads. As a result, the town engineering department now runs the sanitation department, the municipal garage and the town’s buildings and grounds department.

Jack Orben, a retired investment banker and portfolio manager who heads the committee, and Charlene Kagel, the committee’s auditor, discussed the report (see a full copy of it below) at last Thursday’s Town Board work session.

Town Engineer Ken Testa, whose department runs the municipal garage, didn’t attend the work session. Mr. Orben said that Mr. Testa indicated to him that the engineering department is very busy and he doesn’t have time to oversee the municipal garage, which is located on Route 58. Deputy town engineer Drew Dillingham, who was present, backed that statement.

“There’s no accounting of people’s time, and there is no daily oversight of the municipal garage,” Mr. Orben said. He added that the report found that town engineers visited the garage just once or twice per week, and the department’s standard operating procedures had not been updated since 2013. The audit calls for udpating the procedures.

Mr. Dillingham, who is responsible for authorizing purchases at the garage, gave his signature password to the clerk who prepares the requests, the report notes.

“Therefore, no process is in place to ensure that all purchases are properly reviewed and approved,” it states.

The Town Board created the IAAC in 2012 to perform periodic audits on different departments. It reviewed the recreation department in 2014 and the building department the year before that.

The report also found “there is no oversight or accountability for the labor hours charged to a repair order and repairs take an extraordinary amount of time, exceeding the industry standard for the repair.”

The audit also revealed that vendors with existing contracts to supply parts to the town at a discounted price were allowing town employees to use cash to purchase parts for their own vehicles at the town’s discounted rate. State sales tax wasn’t paid on these purchases.

In addition, it was found that an alarm system at the garage wasn’t used before January 2015. The report recommends the alarm system be used and that a security camera be installed.

“For an entire year, the building was not alarmed,” Ms. Kagel said.

The report also states a mechanic — with permission from the former department head — would work on other employees’ personal cars using the garage. The work wasn’t performed on town time or with town parts, it added, but the mechanic was paid for the repair by the car’s owner. The committee urged these practices should stop, and said they were told they did.

The town’s computerized fuel tracking system enables the town to see how much town fuel is used, by who and in which vehicle, the report states.

However, some employees have a master key, or “black key,” that allows them to pump fuel without an associated vehicle so that fuel can be used for things like fuel cans used on lawn mowers.

The report urges the town to keep inventory of which employees have these black keys, including those who have retired.

Supervisor Sean Walter suggested shutting down the whole black key system and starting over. He also recommended the town do a “stick reading” to measure the amount of fuel in its garage tank on a daily basis, a process that enables officials to determine how much has been used, as well as if there’s a leak.

The report said the town used a pump reading, rather than a stick reading, to measure the fuel inventory, and that the county Department of Health recommended a stick reading be done every ten days.

“We’re going to fix that today,” Mr. Walter said, adding that when he worked for a Hess station as a teenager, employees did a stick reading every day.

The report also said the town needs a system to track overrides of the fuel pumps in the event of a power failure.

The audit was discussed at Tuesday’s Town Board meeting as well.

Councilman John Dunleavy said he spoke with the garage employees after the audit came out and was told that many of the items mentioned in the audit have already been corrected.

“I’ve been arguing for the last year that they need supervision up there,” Mr. Dunleavy had said last Thursday, specifying that the supervision needs to be on site.

“We are going to probably put a supervisor in there,” Mr. Walter said Tuesday.

“The Town Board is going have personal discussions in executive session to talk about different personnel moves. We will possibly be hiring somebody to manage the department, and we will be discussing where that department should fall on the structure of the town,”  he said.

Editor’s note: This story was updated at 10 a.m. on Wednesday with comments from Tuesday’s Town Board meeting, and further comments from last week’s meeting.

Internal Audit

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