OGDEN -- A recent state report revealing that Mayor Matthew Godfrey's staff spent $434,000 on three capital improvement projects between 2007 and 2009 without city council permission doesn't impact the municipality's financial stability, an auditor said Tuesday night.
Ken Jeppesen, a principal with Schmitt, Griffiths, Smith & Co., a South Ogden certified accounting firm hired by the council to conduct the city's annual financial audit, discussed the state auditors' report during a study session.
Jeppesen said his firm's audit showing that the city is financially sound remains valid, adding the state report involves procedural matters that the administration and city council have addressed.
The state report was prompted by a written complaint to the Utah State Auditor's Office in March 2009 from local activist Dan Schroeder. Schroeder's grievance involves a proposed ice tower, a railcar welcome center and the Ogden River Restoration Project.
Godfrey and the city council were notified of the state auditors' report findings last month.
The administration's failure to get permission from the city council for the expenditures is labeled a significant deficiency and does not comply with state law or municipal ordinances, the report states.
However, the report's use of the term "significant deficiency" is incorrect because it is reserved for financial issues instead of administrative or procedural matters, said Mark Johnson, the city's chief administrative officer.
"They used the wrong terms," he said.
The city received a Weber County RAMP grant for the construction of a proposed ice climbing tower downtown and incurred about $63,000 for design and engineering costs without city council approval only to learn the grant could not be used for those purposes, according to the state auditor's report.
RAMP funds come from a tax approved by Weber County voters in 2004 that allows the county to impose a local sales tax of one-tenth of 1 percent, which is 1 cent on a $10 sale, to improve recreation, arts, museums and parks.
Also in 2009, the city's administration overspent the project budget to convert a railcar at the Intermodal Hub at 23rd Street and Wall Avenue into a welcome center by $96,000 without council approval, the audit report said.
The administration also paid $275,000 for the Ogden River Restoration Project using bond funds originally allocated to storm water improvements without council knowledge or approval, the report states.
The administration and city council began taking steps to address issues detailed in the report even before state auditors started their probe, Johnson said.
"We knew it was a problem and went to work on it," he said.
The administration has worked jointly with the city council to pass an ordinance to prevent future issues such as those detailed in the audit.
The new ordinance provides funding of certain expenditures for studies and investigations to determine the feasibility of new capital improvement projects. Those may include market studies, alternative analysis, preliminary design and engineering and grant applications.
See what the Weber County Forum says: http://wcforum.blogspot.com/