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Where’s that $9 million?


$9 MILLION is missing from the county treasury… kind of. The money was never there, or it was, but not from the sources that the people in charge led the public to believe. But nobody took the loot, so, really, what’s the big deal?

Confused? County supervisors professed to be when it became clear in 2008 that for many years county government has claimed reimbursements from the federal and state government that neither Washington nor Albany were required by law to pay. The county’s game of make-believe artificially inflated what they reported its fund balance–the amount of money the county keeps in the bank for a rainy day or to help cushion the tax impact of big projects.


This shell game went on for years, helped by a screwball system in which the feds and the state have payment processes more complex than a DVD remote control and because each level of government operates on a different fiscal year.

Art Baer (R-Hillsdale), chairman of the county Board of Supervisors, said he first noticed the discrepancy a year ago as he was overseeing preparation of his first county budget. Many government programs, including Medicaid and emergency housing assistance, require a contribution by the county toward the overall program costs. But the county Department of Social Services was claiming all the costs would be reimbursed. Mr. Baer said he and the board’s budget committee ordered the DSS to stop claiming reimbursement for all its expenses, but the practice did not cease completely until sometime this year.

The most recent annual audit of federal funds by a local independent auditing firm added up the “un-collectable” federal reimbursements for the last decade or so and concluded that the total came to $9 million. Oooops.

Mr. Baer deserves credit for recognizing what was happening and taking steps to stop it. Last week the Board of Supervisors adopted a proposal to hire a certified public accountant as county controller. This person will report to the board on how county money is being handled. Some observers find it surprising that a county with a $140 million annual budget doesn’t already have a CPA on staff, but look at all the money the county saved… or didn’t.

The board also plans to request competitive bids from independent outside auditors rather than continue to award the work to a single company.

These steps represent a welcome change from business as usual in county government, but they won’t fully restore public confidence in the ability of county government to manage its fiscal affairs.

Amid all the explanations, finger pointing and spin doctoring generated by these revelations, no one yet has provided a clear picture of why county officials inflated anticipated federal revenues in the first place.

Paul Mossman, the county commissioner of social services, said that the missing money is actually just what the county was expected to spend on social services programs. It’s tempting to wonder whether the county would have spent less on social services if officials had leveled with the public about the real cost of these programs. And that leads to the possibility that this was an intentional ploy by political leaders to dupe the public into paying more to help people in need than taxpayers would have accepted if they knew the full cost. But that sounds far-fetched for Columbia County.

Maybe it was a scheme to inflate the fund balance, so taxpayers would reward those in power who managed public funds so well. But that, too, is a stretch. Governments that sit on too much cash in reserve anger taxpayers who want to know why government taxed them in the first place.

And then there are always the simple explanations: laziness, sloppy work or collective incompetence.

The problem is that for years county leaders countenanced whatever happened. Now, even the best efforts at reform are suspect because so many of the people involved remain in place. That’s not a fair burden for able officials to bear nor should taxpayers have to swallow lingering doubts. The only way to resolve this is for the Office of State Comptroller Thomas DiNapoli to thoroughly investigate what happened, provide a statement about who did what when and release a critique of the steps the county has taken to prevent something like this from happening again.

The comptroller’s office, which has told The Columbia Paper that it is reviewing the situation here, should conduct its own audit without delay. Taxpayers have a right to know how the county got into this mess and why. 

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