Kim Hammond Justice Center was overspent by approximately $5 million dollars without the County Commission’s approval.
Finding No. 1: Approximately $5 million expended on the Judicial Center project was restricted for other uses.
Finding No. 2: The Flagler County Board of County Commissioners (Board) adopted the budget for its major capital projects at the fund level, limiting its control at the project level. Also, budget amendments were adopted at the sub-object code level rather than at the level originally adopted. Additionally, amounts brought forward from prior fiscal years were overstated for the 2005-06 and 2006-07 fiscal years, and capital budget control procedures did not ensure that capital budgets were amended to show the actual fund balances available from prior fiscal years when those amounts were known. Further, the County Administrator could enhance the policies and procedures regarding the capital projects budgetary process.
Finding No. 3: Although we noted no overexpenditures of major capital projects budgetary authority at the fund level, the level at which the Board adopted the budget, we did note overexpenditures at the project level. Also, the Board was not provided periodic financial information, including budget-to-actual expenditure reports at the project level, to monitor the status of capital projects and assist in decision-making.
Finding No. 4: Deficiencies in internal control over payment processing allowed one Flagler County Clerk of the Circuit Court (Clerk) employee to approve invoice payments for the Judicial Center project and also process invoices for payment without Board authorization. Also, some capital expenditures were paid without adequate supporting documentation and appropriate approval.
Finding No. 5: The Board had not required periodic construction progress reports for the Judicial Center project from the construction contractor, although provided for in the construction contract. Also, the Board approved an increase of $217,500 to a fixed-price contract without a change in project scope.
Finding No. 6: Neither the Board nor the Clerk had developed written policies and procedures relating to capital project administration. Subsequent to our audit fieldwork, in November 2008, the Board adopted policies regarding payment processing.
Finding No. 7: The Board had not established policies and procedures for communicating and reporting known or suspected fraud.
Finding No. 8: Checks issued from the County depository and recorded in the Board meeting minutes did not contain all the information required by law.
Finding No. 9: The Clerk had not documented the public purpose served or the benefit to her office by providing 20-year employment agreements to two Clerk employees.
Finding No. 10: According to the County Administrator, as of January 21, 2009, the Clerk had not responded to his public records requests dated January 31, 2008.
Finding No. 11: The Clerk did not promptly prepare draft minutes of Board meetings for the Board to review, correct as necessary, and approve.