BY ALAN BUTKOVITZ, City Controller/ Last week, my Office’s reputation was called into question once again regarding the Memorandum of Understanding signed between the Nutter Administration and the Sheriff’s Office. It is without a question that my audit staff is topnotch and their findings are always well founded and factual.
In fact, it was through their hard work and professionalism that the Controller’s Office uncovered significant improprieties and financial mismanagement of multi-million dollar funds within the Sheriff’s Office. This led to the Nutter Administration’s announcing several reform measures to improve accountability and oversight.
As stipulated in the signed Mar. 2, 2012, MOU between the Mayor and Sheriff, many promised reforms were to be implemented immediately. However, the Nutter Administration proved to be hypocritical in the implementation process.
While the Sheriff’s Office was directly responsible for the majority of the reforms, the City’s Administration failed to adequately monitor whether the Sheriff complied with the requirements of the MOU. Consequently, according to the City Controller’s audit, the Sheriff’s $38 million in custodial accounts remained highly susceptible to misuse.
The Administration allowed the Sheriff to bypass the rules in the case of two vendor contracts that the Sheriff claimed were executed in accordance with the MOU requirements. Both of these contracts worth approximately $64,000 and $531,000 were established in the City’s accounting system for one dollar each but neither was paid for through the City’s own funds.
Since the Nutter Administration failed to give the Sheriff’s Office the money to pay for the two contracts during the budget process, the Sheriff reverted to its prior method of expending money from its custodial accounts while the administration gave a wink and a nod. The custodial accounts are not reviewed and accounted for by the City to ensure payments are in compliance with contract terms – the complete opposite of what the MOU was supposed to achieve.
Additional noncompliance with the MOU included the following:
In order to assure accountability and transparency, the Controller recommends that the Sheriff’s Office follow the applicable City guidelines when procuring goods and servers, whether it be the City Charter’s competitive bidding requirement, or the Philadelphia Code for professional services. It also needs to refrain from paying contractors directly from the Sheriff’s custodial accounts and instead go through the City’s standard payment authorization process.
More importantly, the City’s Administration needs to make it a priority to provide sufficient funding to the Sheriff’s Office to allow it to carry out its mandated functions.
The full report can be viewed at www.philadelphiacontroller.org.