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HARRISON – Those not in attendance at the Sept. 18 Redding Township Board meeting missed a rarely seen moment of resolve: the seemingly abrupt yet organized resignation of two of the board’s five members. In one swift movement, the township lost the two representatives who had been working diligently for months to restore order to the township’s financial books and legal practices which had been in disarray for years.
Unfortunately, those two officers’ efforts to bring the township into compliance had been met with ongoing resistance via the board’s lack of governmental knowledge and the seeming misperception that a tight grip on the township’s purse strings would solve its issues. There also had been ongoing conflict within the township offices generated by the supervisor’s interactions with the clerk and treasurer. And so, when the board’s agenda items had been addressed, Clerk Trisha Martin read her report, which also was her resignation statement.
“In taking the position of Redding Township Clerk, I found the following items were not available to me to assist me in learning and performing my duties as Redding Township Clerk,” she said.
Category by category, Martin elaborated on the multitude of unlocatable or not-available job-necessary manuals:
Elections: Qualified Voter File; Michigan Bureau of Elections; State of Michigan Test Procedure Manual for Tabulator and Voter Assist Terminals; Electronic Poll Book; and Military and Overseas Voters.
MTA [Michigan Township Association]: Authorities and Responsibilities of Michigan Township Officials, Boards and Commissions; Clerk’s Guide’ Introduction to FOIA [Freedom of Information Act]; Introduction to Township Meetings; Guide to Building a Better Budget; and Township Cemetery Management.
State of Michigan Manuals: State of Michigan Department of Treasury-Accounting Procedures for Local Units of Government; Uniform Chart of Accounts; State of Michigan Retention notices [required to be followed by the State of Michigan]; and the following schedules: General, Clerk, Human Resources, Treasurer, Financial Records and Election Records.
Another elections issue included the election master cards not having been updated for months, possibly longer. And, since the master cards had not been printed, it could not be verified that voter ID cards had been sent.
Equally disturbing was her statement that cemetery records were scattered in several areas and possibly were not up to date.
Another gross legal violation was the fact that there had been no separate employee personnel files, no Form I-9 for employees and no State of Michigan New Hire Forms for employees. Martin also said there had been no documentation attached to receipts and that only the voucher printed from Quickbooks was available. She said there were no invoices attached to disbursements, and that Tax Fund disbursements listed in the check book did not agree with the actual check.
She noted the lack of office and election supplies, as well as the board’s lack of willingness to follow proper procedures, best practices, or to complete required payroll/personnel information, to change thus improve internal controls or budget monitoring. Martin also cited the lack of respect to township residents and employees, which she said was illustrated by the supervisor’s “thumbs-up” when the deputy treasurer resigned at the previous month’s meeting.
Clerk Martin then listed her accomplishments since taking office April 4 of this year, to include: Implementing State of Michigan Unemployment Reporting; implementing a record keeping system that keeps invoices attached to vouchers; implementing state recommended accounting procedures for payroll/personnel files, along with use of proper reporting forms; instituting General Ledger Best Practices using EFT [Electronic Funds Transfers] and ACH [Automated Clearing House] payments policy.
Actions also included gathering vendor information, i.e., W-9 forms, vendor proof of insurance, and implementing other policies regarding the tax drawer/petty cash and bills paid prior. Martin said the majority of election master cards had been printed, but due to lack of election supplies, the voter ID cards had not. However, materials had been ordered and supplied and could now be printed.
Regarding a worker’s compensation audit, Martin said there may be additional costs stemming from the township’s not properly reporting employees and vendors to Workers Compensation.
She also addressed separate salary resolutions for each board member, establishment of supporting documentation for invoices and bill payments for both the clerk’s and treasurer’s side, and the research and implementation of corrective actions for classifying employees versus contractors to be in compliance with the State of Michigan and Internal Revenue Service. Martin also made recommendation for a township corrective action plan.
“After reviewing the Redding Township Corrective Action Plan, submitted to the State of Michigan Community Engagement and Financial Division on Oct. 11, 2018, I make the following recommendations to the Redding Township Board,” Martin said.
Her list included placing payroll in a separate bank account; using an accounting system that will produce a balance sheet for each fund; attaching supporting documentation to check copies; and establishment of internal controls as to who has access to which offices. She also recommended policies to deal with the following: workplace harassment; penalties and interest for taxes; returned check fees; sexual harassment; and authorized check signers. With those recommendations, she finished her statement:
“I have enjoyed my time serving and working with the residents of Redding Township,” she said. “It is at this time, I respectfully submit my resignation as Redding Township Clerk – effective immediately.”
Chris Martin began his Treasurer’s Report by reading a statement of what he had found.
“I took office on June 25, 2019, and tax collection began July 1,” he said. “I found no past tax records to follow for processing payments.”
Martin said that in going through records in an attempt to figure out the job, he had discovered check stubs were in the tax check books from 2015 with no balances, no deposits and no interest posted to it, and that check stubs didn’t always match the written check amounts. Martin said he sought assistance from Hayes Township to learn the BS&A system for taxes and balancing with the county in accordance with the State of Michigan Department of Treasury disbursement calendar.
“I found books marked ‘bank statements’ that were empty,” he said. “Upon searching, I decided we had to contact the bank for copies to try and figure out balances.”
He said vouchers in both the clerk’s and treasurer’s offices had no documentation and that no copies of invoices, copies of checks or receipt documentation could be found – only audits from 2014-2018 stating supporting documentation had been a recurring problem. That included documentation for the prior year’s tax reconciliation with the county, copies of which he had obtained from the Clare County Treasurer’s Office.
“Reviewing the office, I found $10.50 in the till as tax change,” Martin said. “I discovered that at year end there was over $6,000 still in the tax account, and that $200 had been written out of taxes for Petty Cash.”
Martin said that when he had asked the board in July for an audit to give good starting balances in al funds, the request was tabled until September. He also noted the lack of office supplies, adding that by law receipts must be printed with Redding Township’s name and be pre-numbered.
“I had to go to the Cleaver and purchase two generic receipt books: one for taxes and one for general fund to be able to receipt in tax batches and general fund receipts,” he said. “I brought some supplies in from home, due to the pushback on ordering supplies for the offices.”
Martin also spoke of bank statements which “suddenly appeared back in the office in the empty bank statement book” discovered by the supervisor [himself appointed to office March 20, 2019] and brought to the attention of everyone who was in the office.
“My office does not have a computer program for posting the tax journal which should be in the general ledger,” Martin said. “All funds need to be reported in the Treasurer’s Report monthly.”
He said he had been told to use Excel, which does not have that capability.
“Reviewing past audits from 2014, 2016 and 2018, it appears that there has been a problem for many years with segregation of duties and not having proper documentation attached to receipts and checks,” Martin said. “The board should be aware that the computer system being used could be manipulated.”
Then the treasurer noted his accomplishments over the past 2 ½ months, beginning with a system for balancing taxes on the regularly scheduled tax disbursement schedule established by the Department of Treasury.
Martin enumerated 14 different procedures implemented to keep track of all accounts, taxes and disbursements which will enable the township to maintain information flow between the treasurer and clerk offices, stay on top of its finances, keep current running balances on all accounts – and to stay legal.
In summation, the treasurer offered the following:
“It is my recommendation that a policy is established for internal controls,” Martin said. “Currently, there are keys given out to multiple people besides the clerk and treasurer for their offices, filing cabinets and closet. There are personnel records, checks, cash drawer, etc., that only the appropriate offices should have keys to.”
He also recommended that software be supplied for accurate fund accounting, and that if QuickBooks use is to continue, separate bank accounts be set up for each fund. He said this would be necessary to make a balance sheet with the accurate balances needed to set up bank accounts for the fire and sanitation funds, as well as the payroll account.
Martin then stepped into the records closet and retrieved multiple boxes laden with ledgers and files representing the tax account and general fund, provided a thorough accounting of all things that have been brought up-to-date, and then he concluded by presenting his inventory log stating he had given the board “everything,” which he requested the board sign-off on, along with one witness.
“Last but not least, I want to thank the people of Redding Township for the opportunity to serve them, if only for a short time,” Martin said. “It was my hope to bring accountability, transparency and professionalism to the office of Redding Township Treasurer. I feel that I made a good effort to do so, but under the circumstances could not complete my goal. Therefore, I respectfully resign my position as Redding Township Treasurer – immediately.
With that, the supervisor called for a vote to accept/not accept the resignations of the clerk and treasurer. After a 2-to-1 vote to accept the clerk’s resignation, the supervisor called for a second vote in an effort to achieve a unanimous vote – which, by the way, is totally illegal. The vote can be changed before the vote was announced by the presiding officer; that 2-to-1 vote was already announced aloud by supervisor Scarbrough as, “I believe that passes.” The vote was unanimous to accept the treasurer’s resignation, and the supervisor thanked the two for their time.
The next monthly meeting of the Redding Township Board is scheduled for 7 p.m. Wednesday, Oct. 16. Chris and Trisha Martin told the Cleaver that they will attend, with the intent of continuing to ensure the board functions in a responsible, legal manner – making certain there is no un-doing of their efforts to bring order out of chaos – something they said they will be more comfortable doing without the burden of abuse, intimidation, or hierarchal/patriarchal attitudes and tactics experienced while in office.