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Audit Critical of Lewisboro’s Fiscal Management

LEWISBORO, N.Y. – A recent audit by the state comptroller’s office was critical of the Lewisboro town government, saying it did not adequately monitor the town’s financial operation and take timely action to maintain its financial stability.

Most of the audit focused on the period from Jan. 1, 2009, to May 31, 2011. The audit did extend back to Jan. 1, 2006, for a fund-balance trend analysis and forward to June 23, 2011, for interfund transfer reviews.

The audit noted that the town’s general fund balance declined from just over $3 million in 2006 to a deficit of $655,312 in 2009. That deficit was reduced to $338,100 in 2010.

The comptroller’s office contended that the problems were the result of “poor budget estimates and the board’s inability to monitor actual revenues and expenditures throughout the year.”

Town Supervisor Peter Parsons said the audit was not so scathing as some have made it out to be. He said most of the problems were the result of the economy and are on the way to being remedied.

“From 2005 to 2009, the supervisors in office at that time reduced the fund balance because you’re not really supposed to keep them that high,” Parsons said. “Then the economy dropped, and we’ve been trying to climb out ever since.”

The supervisor said he felt the comptroller’s criticism of the town’s budget estimates was unfair.

“The problems with the revenue forecast in 2009 can be attributed to mortgage and sales tax receipts, which is where most of our revenue comes from,” he said. “When the economy collapsed that year, so did (those receipts). No one had a crystal ball to foresee that.”

Parsons had praise for two of his predecessors, Ed Brancati and Charles Duffy. He said that although the two had different approaches to maintaining the budget, in the end they helped to get the town back on track.

“Brancati fell on his sword by raising taxes more than 20 percent,” Parsons said.  “But we needed that revenue. He realized our finances were hopeless. Charlie held the line on expenses very well to keep spending down when we needed to.”

As to the state comptroller’s contention that Lewisboro needs to improve its oversight of its financial activities, Parsons said he has already taken measures to do it. He points to the quarterly financial reports from the town's department heads that he has implemented. The reports are presented during regular Town Board meetings.

“I was not doing those in response to the audit report,” he said. “It was part of my campaign promise.”

Parsons noted that the audit was also critical of the way the town handled its bill-checking procedure. The town clerk alone was responsible for checking the bills that came into the Town House before presenting them to the board. The comptroller’s report said it would be better and would provide greater oversight if they were handled by the Town Board.

“They want the whole board to do it,” he said. “But I always said that one person can do it very well or you can have five people pretend to do it.”

Instead, what Parsons wants to do is create a town comptroller position and appoint Leo Masterson, the town’s finance director, to it once the civil service paperwork is complete. Masterson would then work with Town Clerk Janet Donohue on the bills, thus providing the double-checking sought by the state.

“This strikes me as a better way,” Parsons said. “In the past 10 years the town has gone through a lot of supervisors and almost as many finance directors. I want to hang on to Leo by changing his position to a nonpolitical appointment.”

Under Parsons' plan, the town comptroller, unlike the finance director, could not be hired or fired by the supervisor. That responsibility would fall to the entire Town Board.

As far as the audit is concerned, Parsons said he didn’t consider it “all that negative.”

“Look, we had a bad hiccup back in 2009 and we’ve been pulling back out of it ever since,” he said. “Our budgets from 2010 to 2012 have done the town a lot of good.”

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