News

Questions continue over audit

By Scott Wagar

01/10/2012

With questions not being answered publicly by Councilman Brad Gangl over a $2,000 bill which was not approved by the entire council, another individual has stepped forward in a public council meeting seeking answers. However, this time, it wasn’t a local resident but one of the council’s own.

In the December council meeting, local resident, Tim Sanderson, asked Gangl about a $2,000 bill from a local accounting firm (Lervik & Johnson) over a report that was produced by the firm and charged to the city’s taxpayers without the finance committee (made up of Gangl and Mayor Doug Marsden) first taking it to the full council. At that time, Gangl and Marsden did not answer Sanderson as to why they moved forward with Lervik & Johnson without the council’s consent.

During the year-end meeting on Dec. 29, former mayor Mona Marchus requested to speak to the council about a number of issues concerning the council’s action, and reiterated Sanderson’s question to Gangl about the $2,000. Once again, Gangl did not publicly speak on the issue.

On Monday evening, as the aldermen met for its January council meeting, the question of Lervik & Johnson’s bill came up again, but this time it came from Councilman Harley Getzlaff.

“We need to get to the bottom of this audit,” said Getzlaff to Gangl. “We have not heard enough about it. The audit’s bill was not brought before this council and it was not voted on by this council. We need to know what is going on about this.”

This time, Gangl spoke out about the issue.

“Lervik & Johnson were doing an audit for us, a two year audit. So, what we did was, and that would include the mayor, not just me, that it would be a good idea to have them look at the time cards.”

The time card issue is about the wordage in the employees’ handbook as to how vacation and sick time is cared for concerning overtime. It is unknown for how long this policy has been in place, but according to Gangl the wordage in the employees’ manual was incorrect and that the city auditor, Penny Nostdahl, was doing the payroll incorrectly.  However, Nostdahl told Gangl that since she has been employed in the auditor’s office, the payroll has always been conducted in this manner.

It is uncertain to all present, and former, city officials as to how long the city’s payroll has been conducted in the manner which Gangl questioned, and Nostdahl, herself, was taught payroll in its present day manner while she worked under former city auditor Edna Larson as her assistant.  

What is known about the history of the city’s payroll is that in 1992, under Larson, she made a decision to do the payroll differently, which upset the city employees. The employees went to the mayor at that time, Norm Larson, and asked him to go back to the original payroll policy, which he agreed to do. Somewhere during the controversy of the payroll the wordage in the handbook was never taken care of and was eventually lost in time.  

In March of last year, Gangl stated that he had seen the policy and told Nostdahl the handbook policy’s wordage was incorrect. Nostdahl, along with the city superintendent, Keith Fulsebakke, explained to Gangl the history of the policy and as to why the payroll is conducted in the manner it is, which Gangl disagreed with.

The policy was eventually sent to Lervik & Johnson to be investigated in the audit, and a $2,000 bill was sent to the city for the local residents to pay.

On Monday evening, Getzlaff asked Gangl why this matter wasn’t brought to the full council for a vote before going to Lervik & Johnson’s firm. Getzlaff also asked why this matter wasn’t placed in the finance committee’s minutes.

“I checked, this issue isn’t in the minutes, why not?” Getzlaff asked Gangl.

With the question asked to him, Gangl informed Getzlaff that he would have to ask Mayor Doug Marsden that question, which Getzlaff did.

“I don’t know what to tell you,” Marsden said to Getzlaff. “It was over there and Tony (Johnson) told me about it. So, I told him to do it. I didn’t know I had to bring it to the council.”

With his answer, Getzlaff then stated that during the year-end meeting on Dec. 29, 2011, Marsden had stated to the council members that committee members had the right to do research concerning council business.

“Mayor, does that give any of us the right to spend $2,000 and not have to take it to the full council first?” Getzlaff asked Marsden.

At that time, Gangl stepped into the conversation and stated that part of the confusion concerning the issue was that the city didn’t have a system set-up properly to answer Getzlaff’s question.

“One of the problems here is that there really aren’t any ordinances on who does what, or what committees can do. If you look at the century code, it is really up to the city council as to how they want to structure things,” said Gangl, who added that he had done some research on how the council could improve its structure. “Some of the better councils and commissioner boards in the state list every committee in its ordinances, who appoints the members of that committee and what the job description is for the people on that committee.

“That’s where I think we have an issue here because no one ever told me this is what we do, or how we do it,” Gangl added. “I think to keep ourselves out of trouble it would be a good idea if we take a look at our structure and what can be done about it.”

With that said, Getzlaff went back to the issue of the report and the $2,000 bill. He asked Gangl that since the issue did not go before the full council, should the taxpayers be responsible in paying the bill? Gangl stated the taxpayers should pay for the bill.

“It never went through the council, it was never in the minutes” Getzlaff said. “Should any of us council members have the authorization in committee to go out and approve a bill like that?”

“As far as I am concerned, and I think the mayor will agree with this, the committee had the authorization to do this,” Gangl told Getzlaff. “It was already part of the existing audit.”

Gangl then asked that the focus of the discussion stay on the audit and not who should have to pay the $2,000.

Getzlaff refused the request, and stated he wanted to stay focused on the $2,000 charged to the taxpayers, and asked again why this hadn’t been brought to the council. He also asked why Nostdahl wasn’t informed about the $2,000 bill considering she was the city’s auditor.

Gangl said that Nostdahl did know about it. However, Nostdahl spoke up and disagreed with Gangl.

“No I didn’t,” Nostdahl told Gangl. “I had to call Tony (Johnson) and ask him because I didn’t know why the bill had come to the office.”

Nostdahl also added that when she spoke with Johnson about the $2,000 bill, he informed her that she was to ask Gangl about what the billing was about. Gangl denied what Nostdahl said. “That’s not true, that’s not true,” he said.

Gangl then reiterated that he wasn’t responsible for the audit, but went on to add a counter diction to his statement.    

“I didn’t authorize the audit,” Gangl said. “The mayor did, and, myself on the finance committee.”
Getzlaff expressed that he didn’t believe Gangl.

“A lot of things have come out,” Getzlaff said. “Why isn’t the council members supposed to know about this? Why weren’t the taxpayers supposed to hear about this? Why did the auditor have to call Tony? This is very unfair.”

“The audit was done because were getting two different explanations for why we were paying overtime for vacation and sick time because it is not in the policy that way,” Gangl told Getzlaff.

Getzlaff stated that the policy had been rewritten in 2011 and was correct, which Gangl disagreed with. However, Nostdahl and Alderman Grant Tegastad stated that the policy had been rewritten, approved and placed in the policy. Gangl disagreed with them again and a discussion broke out about whether the policy had been cared for.

With some confusion and disagreement going on in the discussion, the entities involved felt that the wording had been changed in the policy, but perhaps the policy hadn’t left the committee and been voted on by the full council.

“It hasn’t left committee,” Gangl said. “So, it is not policy and it is not in effect,”

With Gangl words, Marsden ended the meeting.
With the meeting complete, Nostdahl checked the city’s records and discovered the pay policy had been voted on and approved by the council.

As for Monday’s night meeting, Getzlaff doesn’t feel this issue is over.

“Did you see how quickly the mayor ended the meeting?” Getzlaff told the Bottineau Courant after the meeting. “To me, this isn’t over. I still have questions I want answers for, and I will be placing it on the agenda for next month’s city council meeting.
“I also don’t think the taxpayers should have to pay this bill because I feel it should be paid by the person who authorized it,” Getzlaff continued to state. “I think this matter has been unfair to our auditor who does a great job for our city, to the council members left in the dark, and to the people of this city who are stuck paying this bill.”

Gangl stated that he was not pleased on how the meeting ended.

“The Mayor and the finance committee asked Lervik & Johnson, who were in the process of doing the city’s two year audit, to look more in depth at the payroll and time cards because of discrepancies between how the city payroll was being done and our policies. This was, in my opinion, not a separate audit request, but a request for a more in depth look at a specific issue during the same audit period,” Gangl said in a post meeting interview with the Bottineau Courant through an e-mail. “Even if it could be considered a separate audit request, I believe the Mayor and finance committee are authorized to ask for a more in depth look at a specific issue, as long as there is an ongoing audit. If it was a totally separate audit request, then there might be a question if it wasn’t in the city budget. Also, the city council already approved the $2,000 at a previous meeting, so it is a moot question.

“I find it hard to believe that this would even be an issue, given the fact that the city auditor was misappropriating city funds by paying overtime for vacation and sick time to all the city workers, including herself. She was in no way authorized to do this and had been doing it for at least 12 years. This would amount to about $50,000. When this was discovered, the auditor first said it wasn’t being done; then it was authorized by former Mayor Larson; then back to it wasn’t done; and then she didn’t know the policy. Take your pick as to what is the truth. This is why the additional information was asked for in the audit,” Gangl continued to state. “I also don’t understand the reluctance by the other city councilman to even discuss this issue in depth during a council meeting. Instead, they would rather attack me and accuse me of badgering the city auditor. Of course, some are on the fire department with the Fire Chief Eric Nostdahl. The reason I have been getting attacked by Mona Marchus and Tim Sanderson is because the auditor is calling the shots and telling them what to say. She is afraid of losing her job so her tactic is to spread vicious lies about me. Why else would Mona Marchus say I was hacking into the computers at the city and EDC? How would she have heard that? And why on earth would she repeat something like that? It is a flat out lie.

“I also don’t understand how asking for digital time clocks is a trust issue with the city employees, the auditor maybe, but not the employees. In my opinion the only difference is accuracy, better reporting, and it would save time because it would interface directly with the accounting software the city uses. Another smoke screen, of course the auditor doesn’t want additional controls on how she does payroll. Does any of this make sense?” Gangl added. “I am getting tired of being attacked for doing what I think is my job and responsibility on the city council. The council needs to come up with ordinances to clearly define what each committee is responsible for and exactly what their authority is so these kinds of issues are resolved.

“I would hope that the people of Bottineau would attend some of our monthly meetings and even committee meetings to see what is happening and voice their opinion. Right now it is rather lopsided and I don’t know if I will continue on the city council unless I feel I can continue to be effective. In my opinion, there are still quite a few issues that need to be settled, but you have to have people on the council who aren’t afraid to tackle them. Judging by how I am being treated, I sincerely doubt that will happen,” Gangl concluded.

Penny Nostdahl stated this past week to the Bottineau Courant that Johnson concluded in his investigation of the payroll policy that she had committed no wrong doing.

“After receiving a copy of the audit, I called Tony,” Nostdahl said. “He told me that I had done nothing illegal, immoral, and that we do our payroll the way many councils in the state do. Mayor Marsden has also told me that I did nothing wrong and that I do a good job as the city’s auditor.”