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Thursday, February 16, 2012

State Auditor Calls For Better Practices in Monarch Fire District

BY PATRICK M. O'CONNELL - ST. LOUIS POST-DISPATCH | Posted: February 16, 2012 

CHESTERFIELD • As he released a state audit of the Monarch Fire Protection District on Wednesday, Missouri Auditor Tom Schweich said he wasn't there to settle political scores or take sides in squabbles that have recently plagued the sprawling district.

"I hope this is a starting point for putting political differences aside," Schweich said.

Those contentious differences among board members, firefighters and residents over issues ranging from salaries, a sex discrimination suit and legal fees eventually led to the call for the audit a year ago.

The auditor's findings revealed several problems with district expenses and practices, leading to an overall "fair" rating and a series of recommendations to tighten spending, clean up financial record keeping, obey open meetings laws and re-examine a costly retirement incentive package.

Among the specifics cited by the auditor's report were $231,000 in retirement incentives over two years that his office said violated the state constitution, a $26,000 awards banquet and at least 40 instances of questionable closed meetings. The auditor also said the district needs to get bids and written contracts for legal services that in 2010 cost a total of $212,000, and perform a salary survey of administrative positions to ensure the pay structure is in line with those of other districts.

"I don't get involved in the politics. These are concrete, tangible ways to improve the problems of the district," Schweich said during a meeting to release the findings at district headquarters in Chesterfield. "All you have to do is fix these problems, and you will have a pretty well-run district."

Board members said they already have begun to implement changes, and the auditor praised district officials for their willingness to correct issues. The district serves Chesterfield and parts of west St. Louis County.

"If this audit is the mechanism for us to right the ship on the controls and processes of the district and cut down on the rhetoric and the politics, I'm all for it," board secretary Steven Swyers said.

Gov. Jay Nixon ordered the audit of the district in February 2011. Kim Evans, the current Monarch board president, had voiced concerns about possible wasteful spending of taxpayer money.

Schweich reviewed the findings Wednesday in front of board members and about two dozen residents. Afterward, Evans was unavailable for comment.

In terms of the Sunshine Law issues, the auditor's office criticized the district's closed meetings, saying the board did not document specific reasons for them. The auditor said such sessions, which happened 40 times from January 2010 through September 2011, prevent the public from becoming aware of the discussions and votes held in secret.

"We don't think anything devious was happening, but we did feel some of the meetings should have been open," Schweich said.

The auditor's office said the district's retirement incentive package, which provided $231,000 in compensation in 2010 and 2011, violated state law that prohibits extra compensation to public employees for services already rendered.

The incentive package gave employees $1,500 to $2,000 for each year of service and also set up a health insurance benefits plan for retirees, up to $2,000 per quarter for five years.

The auditor said the board should "ensure all retiree benefit expenditures are necessary and beneficial to district residents." The district formally responded in the report, saying it created the retirement package in coordination with the district's labor law attorney "to reduce long term labor cost."

The audit says the district spent about $26,000 for an employee awards banquet in September, and $16,000 of that went for 'service awards" to employees. It says 63 employees received awards including bronze bells, rings and watches the district bought. The audit calls the event "a questionable use of district funds."

It says the district paid $5,000 for the conference room and dinner, $2,000 to a guest speaker and $2,000 in miscellaneous attendance prizes.

Assistant Chief John Borgmann said the banquet was held on Sept. 11, 2011, in the pavilion at the Doubletree Hotel and Conference Center in Chesterfield. He said the speaker was John O'Leary of Webster Groves, a motivational speaker who was severely burned as a boy in 1987.

Borgmann said J.R. Terrell, manager of the district's health plan, later donated $1,500 to the district to help cover O'Leary's fee.

"Twenty-six thousand dollars for a party is too much money and we believe that was a waste of taxpayer resources," Schweich said.

The district responded that it will review "the dynamics of the awards banquet" and that it is "dedicated to cutting costs."

The audit also cited $212,000 in legal expenses in calendar year 2010, listing fees by legal service.

The audit says that the district sought formal applicants for general counsel but not for the other legal functions, and that the district had no written agreements for general or pension counsel. The audit says seeking proposals and written agreements provides more control at the "lowest and best cost."

The report also found the district made a $2,100 duplicate payment to a pension attorney, paid $1,200 to the wrong vendor for cleaning supplies and does not adequately document some expenditures.

Tim O'Neil of the Post-Dispatch contributed to this report.

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