PENSION DEFICIENCIES CITED; MAYOR FOUND FIRE PENSIONS OVERPAID

LINK CORRECTED: State Audit Released for City of Huntington; 2016 Fiscal Year; Fire Pensions Overpaid

Updated 31 weeks ago by Tony E. Rutherford, News Editor
LINK CORRECTED: State Audit Released for City of Huntington;  2016 Fiscal Year; Fire Pensions Overpaid

The Administration and Finance Committee of Huntington City Council reviewed results of the annual state audit .

The complete 2016 fiscal year audit can be viewed as a PDF by clicking attachments below, or at the WV auditor site.

One of the findings cited by City Manager Cathy Burns is that fire pensions have been overpaid, according to the audit. (See attachment below which includes the letter from the secretary of the firefighter pension plan).

"It appears that benefits were calculated in excess of amounts authorized by statute." The audit said the Fire Pension Board committed error; however, despite the on-going nature of the miscalculation this is the first year the state auditor has made the finding.

Mayor Williams, chairman of the local pension plan, first brought the calculation error to the board's attention in March 2016.

In addition, the audit found that retired firefighters have been overpaid "likely since 1990," said city manager Cathy Burns in a Herald Dispatch interview.

 

 Burns said the incorrect formula is still being used on "50 or so" retirees, although it has been corrected on others.

Scott Mellert, secretary, of the city's pension board wrote in a letter included in the audit findings:

"The board carefully considered whether it would be appropriate to recover any prior overpayments which were mistakenly made to retirees or to adjust future payments to retirees whose benefits may have been mistakenly calculated. The Board concluded that it would be both impractical and inequitable either to seek recovery of overpayments made prior to July 1, 2016 or adjust future payments to retirees who retired prior to that date. Among the factors considered by the Board in reaching these determinations were the hardship which such action would impose on retirees, the legal uncertainty surrounding the likely success of such efforts and the fact that the City of Huntington has contributed to the fund each year since January of 2010 the amount actuarially determined to be necessary to assure the fund's solvency and fiscal integrity over a 40 year period, taking into account

TO GO ON LINE: https://www.wvsao.gov/ChiefInspector/pdfauditResults;  Must disable pop up blockers; Enter Huntington, Municipality; Cabell County; 2016

 

The 117 page  document contains suggestions. Most of these are near the end of the PDF.

As in prior years, the auditor has found a "significant deficiency" that is not a "material weakness" concerning segregation of duties.

The report lists noncompliance with contributions to the Firemen's and Policemen's Pension and Relief Funds and benefit calculations (based on period ending June 30, 2017. ) and a part of the finding includes overpayment and therefore miscalculation of benefits for retireees.

The auditor found no deficiencies i.e. material weaknesses or significant weaknesses or any compliance issues regarding major  federal grant funding programs.Pursuant to a Corrective Action Plan, the city caught up on the accounts in November 2016 and as of March  17, 2017 have made four contributions for that year.

The audit indicated that prior deficiencies regarding financial statement preparation, landfill closure and post closure liability and spending in excess of the levy estimate reference the general fund have been addressed and corrected.

As part of the audit, a conclusion has been made regarding several HMDA properties i.e. Ebenezer  Medical Outreach Center, Douglas Center Limited Partnership, and Huntington High L.P. loans were "uncollectable" based on the city's lien position. 

"It was determined that the assets of the borrowers are not sufficient to make payments on the outstanding loans and it is doubtful that the payments will be made in the future."

The Huntington High L.P. recently sued Arts Resources for back rent.

Click here for discussion of long term liabilities:

http://www.huntingtonnews.net/148183

 

(The article does not analyze the state auditor's findings.)

 

 

 

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