Missouri State Auditor's Office

June 27, 2001

Report No. 2001-48

The following problems were discovered as a result of an audit conducted by our office of the Village of Clyde, Missouri.

The village has not prepared an annual budget.� State statute provides that no expenditure of public monies shall be made unless it is authorized in the budget.� A complete and well-planned budget, in addition to meeting statutory requirements, can serve as a useful management tool by establishing specific cost and revenue expectations for each area of the village operations and provide a means to effectively monitor actual costs and revenues.� It will also assist in setting tax levies and informing the public about the village�s operations and current finances.

The village�s property tax rate exceeds the maximum authorized by state law and public hearings on the proposed property tax rates have not been held for at least the past several years.

Board minutes did not always include sufficient detail of matters discussed and actions taken and were not signed by the clerk.� In April 2000, the appointment of Trustee Joe Stoll to fill a vacant position was not documented in the minutes.� In addition, board minutes do not always include a record of votes taken.

The village does not have a formal bidding policy.� Board minutes do not identify the disbursements approved by the board at its regular meetings and the village did not enter into formal written agreements for engineering or legal services.� Adequate documentation was not always maintained to fully support some expenditures and the village did not obtain an appraisal of the land and building it acquired.

The minutes for the May 1999 Board of Trustees meeting indicated Trustee McCrary voted in favor o the reappointment of his wife to the position of Village Clerk.� The appointment or hiring of a relative by a public official is prohibited by the Missouri Constitution.� In addition, Trustee McCrary voted in favor of an ordinance granting an easement of village property to one of his sons.

The Missouri Constitution provides that any public official who names or appoints to public office or employment any relative within the fourth degree shall forfeit his office.� However, Trustee McCrary has been reelected to the board in April 2000, subsequent to the appointment in question.

Because of the serous consequences which result by hiring a relative, the board should ensure its members abstain from any decision to hire a relative and ensure that action is fully documented in the board minutes.� Discussions and decisions concerning situations where potential nepotism or conflicts of interest exist should be completely documented so that the public has assurance that no village official has benefited improperly.� In addition, the board should consider establishing a policy which addresses these types of situations and provides a code of conduct for village officials.

The Board of Trustees has not appointed separate individuals to serve as Village Clerk or Village Treasurer.� The Village Clerk also serves as the Village Treasurer, and until 2000, also served as Village Collector.� The Village Clerk is responsible for all record keeping duties of the village, including receiving and depositing monies, preparing invoices for payment, signing checks, performing bank reconciliations, and preparing financial reports.� Neither the board nor other personnel independent of the cash custody and record-keeping functions provide adequate supervision or review of the work performed by the Village Clerk.� The current procedures jeopardize the system of independent checks and balances intended by state law.� In addition, the village clerk is not bonded as required by state law.

During the year ended December 31, 2000, the village received approximately $3,000 in motor vehicle-related revenues from the state which were deposited in the General Revenue Fund.� The Missouri Constitution, requires that motor vehicle-related revenues apportioned by the state of Missouri be expended for street-related purposes, including policing, signing, lighting, and cleaning of roads and streets.

The Village Clerk, who also served as Village Collector, collected property taxes for 1999 and prior tax years for the village.� The Village Collector did not prepare a delinquent tax list and turn it over to the County Collector as required by state law.� The County and Township Collectors began collecting taxes for the village in 2000.

State law requires the Board of Trustees to annually turn over to the county collector a delinquent tax list and certified copies of all tax bills included in the delinquent list.� The County Collector is then responsible for collecting the amounts due, including any interest and penalty charges.� An Attorney General�s Opinion concluded that the delinquent taxes of a village should be in the hands of the county collector by the first Monday in March of each year.

The village has not established a formal policy regarding public access to village records.� Currently, the village charges residents $1 per page for copies of village records.� Written policies would establish procedures for the residents to follow and the cost for the requested information.� In addition, written policies would help avoid misunderstandings regarding the availability of village records.

Village elections held prior to April 1999 were held at the home of the Village Clerk and her husband, Trustee McCrary.� This does not appear proper, particularly since Trustee McCrary was running for the board during the election held at this home.� In addition, while the village minute indicate who won the elections, adequate documentation, including the abstract of votes, was not maintained.� Village elections are now conducted by the County Clerk.