FIND accounting practices unconventional

December 21, 2011

By Alexi Howk

For an organization that has assets worth more than $166 million, records show the day-to-day accounting practices of the Florida Inland Navigation District are unconventional.

FIND is a six-person state agency based in Jupiter that works with the U.S. Army Corps of Engineers to maintain and manage the 400-mile Intracoastal Waterway along Florida’s east coast. The governor appoints 12 unpaid board of commissioners, who represent the 12 counties on the east coast.

Since 2005, FIND has spent more than $503,000 on travel and meeting expenses for commissioners and staff, a Scripps Treasure Coast Newspapers investigation found.

A review of travel records for the commissioners revealed they frequently stay in luxury waterfront hotels when attending meetings, throw taxpayer-funded outreach events the night before each meeting and on occasion rack up big bills for plane tickets and car rentals.

Scripps then looked at employee travel records and found expenses reports weren’t as detailed as those filled out by commissioners. For example, staff members often don’t list the price of hotel stays on reports or the cost of airfare for trips.

FIND Executive Director David Roach said staff doesn’t list the cost for hotel stays or airfare in most cases because those costs are paid for using agency issued credit cards.

He said commissioners by law are required to pay out-of-pocket travel costs up front and later seek reimbursement. Roach said it’s for tax purposes because commissioners are not employees of FIND, which is exempt from being taxed.

But Scripps Treasure Coast Newspapers also found other out of the ordinary accounting practices.
Records show Roach booked two one-way flights for himself and his wife from Jupiter to Washington for a FIND lobbying trip in July 2010. The total cost of the one-way flights was $251. Roach submitted and approved reimbursement for both he and his wife’s ticket. Roach said rather than seeking reimbursement for a round trip for himself, he added his and his wife’s tickets together for the cost of his round trip.
“We were picking up our grand kid, and I paid for those three tickets coming back out of my personal account,” Roach said. “Apparently, when I filled out that travel voucher I didn’t have that other receipt coming back so I did the easy route. Instead of me going home and going through my personal records and finding that other receipt I just said well just double it. It did cost me the same amount back.”
Records show Roach sometimes pays for corporate expenses with personal checks. He even wrote one in 2009 for $700 to pay a permit fee to the Florida Department of Environmental Protection.

He used the same payment method in 2008 to pay for landscaping services at the FIND office. Roach said he is not authorized to sign FIND’s checks. He said Florida law requires the checks be signed by two commissioners, which can be difficult when paying for immediate expenses because commissioners are scattered across the state. The checks also are signed by FIND’s finance director.

“Even if I wanted to pay somebody $10 with a check I’m not authorized to write it,” Roach said. “Every check we write has to be mailed out for signature somewhere within the district. That’s the law, and that is a good check and balance because we’re such a small staff. … It is a little bit inefficient, but we’re used to doing it.

“Most vendors send you an invoice for 30 days payment, so we cut checks every two weeks and ship them out and get them back and distribute them and make it work.”

Roach paid out-of-pocket $100 cash for office landscape maintenance and then received reimbursement after producing photo copies of $20 bills.

He conceded making photo copies of $20 bills totaling $100 doesn’t prove he gave actual cash to the contractor.

“But that’s what I did to try to have something in the file for the auditors and you know anybody who wants to look at it like you,” he said.

Roach said the contractor asked for partial payment in cash because he was financially struggling. Roach wrote a personal check to the contractor for the remaining balance of $500.

“He’s always $20 short of everything,” Roach said of the landscaper. “He’s come over to do work for you and he’ll be like, ‘Can you give me $20 so I can go get lunch and fill up my truck?’ So he always likes to get a little cash on the deal. So, we had him trimming here and he wanted to get paid immediately because he’s living hand-to-mouth, so I just paid him and got my reimbursement. He’s a heck of a nice guy, and it makes me feel good to help him.”

Roach on at least three occasions stayed at more expensive hotels for meetings but in handwritten notes addressed to “whom it may concern” and “the file” asked only for reimbursement for the less expensive rates paid by FIND officials staying at another hotel.

Roach said he stays on occasion at different hotels with his wife for a more private setting away from his coworkers. Asked why his reimbursement request wasn’t addressed to FIND’s finance director or Assistant Executive Director Mark Crosley, Roach said, “I just wanted to document what occurred for the finance director, commissioners, our independent auditors and anyone else that might review the information.”
Employees have also requested and received lump-sum reimbursements for travel more than a year later. Crosley received a $2,283 check in 2008 for a year’s worth of travel expenses. Roach said there is no policy establishing a time frame for when employees must submit reimbursements.

“I don’t think it’s good,” Roach said. “We got on him about it, and now he’s submitting them at least twice if not three or four times a year.”

Robert Weissert, vice president for research and general counsel with Florida Tax Watch, a nonprofit government watchdog group, said FIND should have a policy that dictates when reimbursements must be filed.

“As far as having no policy, that sounds like that would be an opportunity to have a policy in place that would ensure within a reasonable time where verifications can be made and where people could remember their expenses,” he said. “The longer you wait after expenditures are incurred the harder it is to verify things.”

Expense reports for Crosley also were heavily whited out. Roach said Crosley fills out his reports using an ink pen and used liquid paper on several of his reports to correct mistakes.
Weissert said organizations handling taxpayer money should have standard policies in place governing expenses.

“We need to make sure that entities that are being reimbursed for public expenditures are keeping good records,” he said. “Timely and accurate records are important for any organization handling taxpayer dollars. They don’t have to be hard and fast policies, but there should be some standard in place for what should qualify, and it should pass the smell test.”


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