Reviewing a recent audit, Tillamook Fire District directors discussed a lack of accounting safeguards during a three-hour long April board meeting.
Citing a letter from the auditor, Interim Fire Chief Dale Kamrath said two issues needed to be addressed, the first being a lack of accounting control mechanisms – essentially more hands involved in the accounting process. Kamrath said that concern was raised in the previous eight years of audits as well.
Ideally, one person would open a bill, another would match it to an invoice, a third would enter the data into the system, and a fourth person would handle the check. Kamrath said it was unlikely for any smaller organization to put that much manpower into the process. He also said adding people to the accounting process could make errors more likely.
“To be able to pull that paragraph out of his letter every year, it’s going to take too many people from an employee standpoint to be able to make that happen,” Kamrath said. “I think there is some things we can do.” District directors discussed possible changes to the accounting process, agreeing that there was not enough staff to create such a complex chain of accounting.
Board chair Debra Reeves moved the discussion to the second audit issue, reading directly from the letter and stating, “we specifically noted errors in the payments of volunteer stipends where the number of service calls from the attendance system did not match the number of service calls paid. Without proper review and oversight, it is possible for errors or fraud to occur and not be detected.”
Referencing a rundown of calls from 2017 to 2018, Reeves said there were two people involved in the accounting process for those calls: one person inputting service calls and another inputting points to a system that determines stipend payouts. A review of the call log compared to the points system uncovered a deficiency.
“Quite a few of the volunteers did not get paid for their calls throughout the whole entire year,” Reeves said. “Volunteer stipends were not paid correctly for that year.”
The stipend payment issue was raised previously during a February board meeting. Since then, Reeves and fellow board member Tim Hamburger checked into the process of inputting calls and assigning points. Hamburger described the system as “pretty bulletproof,” showing who logs in from where and what they input. Other board members plan to personally review the system as well.
“What the auditor came up with was exactly correct … there was a sufficient amount of money that wasn’t laid out there, that wasn’t paid to these people.” Hamburger said. “This has gone on for quite some time, and I think these volunteers are due what they’re due – they do most of this for little or nothing anyway.”
Reeves explained how the system works. Every time a volunteer goes on a call, they log into the attendance system. That information goes to another person who then inputs points for the calls, which dictates how much of a stipend the volunteer will receive for their service.
Reeves said the call response information was going into the system, but the points were not being assigned – they were being randomly deleted. Previous discussions had questioned whether there was a data breach or some manipulation of the system. However, after investigating it Kamrath said that was not the case.
Hamburger said his review of the process showed it to be flawed, finding instances where points weren’t assigned, or where some volunteers received points while others on the same calls did not. He expressed his frustration with the situation and urged the board to take corrective action.
Board member Brian Cameron questioned if the discrepancy was truly a random data problem. He asked whether the problem was ongoing since this past fall at least. Kamrath said the program had been checked up to October, and a check going up to December would be done.
A later review of November and December found no anomalies. Discrepancies were initially found from July 2017 to October of 2018. It wasn’t clear yet how long the problem was ongoing.
The auditor also reported he could not verify what the salary rates are for the staff firefighters. Kamrath said the pay rates are recorded on time sheets and in budget documents, asking for further clarification from the auditor, who said firefighter salary rates were not documented and therefore could not be verified.
There was also some confusion about how staff overtime and compensatory time are being accrued and paid out. It’s possible payments for time and half hours have been made at two and a quarter time. Adding to that, a review of three years of time cards showed paid staff earned overtime and vacation hours that were somehow deleted.
At one point, board member Eric Swanson said the District might have a major payroll problem. “We need to clarify how that’s being done because they need to be compensated correctly, and it’s clear that we’re not quite sure how that’s working,” Swanson said.
Responding to frustration and doubt from audience members over the time the volunteer stipend issue has been ongoing, Reeves asked for patience as the board of directors works through it. There was some sentiment from the audience that the volunteer stipend problem had been overshadowed by staff payroll concerns.
“I’m as frustrated as anybody,” Hamburger said. “But sometimes the wheels turn slow.”