County clerk Michelle Crocker and county treasurer Vicki Kilway agreed this week that an audit report that was formally accepted by the Leelanau County Board of Commissioners Tuesday evening is a big improvement over last year’s audit report.

A half-inch-thick audit report for the fiscal year that ended Dec. 31, 2006, uncovered a number of “significant deficiencies” in how county officials keep track of taxpayers’ money – leading to sharp disagreements between Crocker and Kilway over whose department was primarily responsible for causing the accounting errors.

Auditors pointed at Kilway.

A slightly thinner report for the fiscal year that ended Dec. 31, 2007 was presented to the county board last week and reflected “a good, clean audit,” according to Crocker.
“I would concur with that assessment,” Kilway said. “The 2007 report is clean and is a big improvement over 2006.”

Crocker noted that specialists from the auditing firm Rehman-Robson provided extra help to county personnel throughout the year in reconciling figures kept separately by the clerk’s office and treasurer’s office. Crocker credited accounting clerk Jennifer Zywicki and deputy treasurer Becky Clark for working “very well together” this year. Zywicki works for Crocker through Crocker’s chief deputy accountant, Chelly Roush. Clark works for Kilway.

Roush has declared her candidacy for the Republican Party nomination for county treasurer in the Aug. 5 Primary Election, running against Kilway, the incumbent since 1981.

The main purpose of an audit, Crocker noted, is to ensure that officials are properly accounting for taxpayers’ money and are complying with all the legal safeguards in place to ensure the county’s finances are properly handled.

“It’s worth noting that every one of the items in our general fund stayed within the guidelines and none were over-expended,” Crocker said. “Outside of the general fund, though, there was a lot of activity and a lot of money passed through the budget because of construction of the new Government Center.”

Kilway explained that money passing through a delinquent tax revolving fund and a capital projects building fund amounted to the largest expenditures through 2007.

County officials began shifting funds to pay for the new Government Center in Suttons Bay Township in 2006 when construction of the new facility began – and continued that process in 2007. Kilway said that in 2007 some $4 million was shifted out of a delinquent tax revolving fund to help pay for the new $10.6 million facility, leaving some $1 million in the fund – more than enough to cover delinquent taxes for the year.

In both 2006 and 2007 the county shifted about $750,000 out of its general fund each year to help pay for the new facility. In 2006, about $3.22 million from the captial projects building fund was expended on the project, Kilway said, with an additional $3 million spent in 2007.

“We’ve been in this facility now since February,” the treasurer noted, “so we will finally be able to get a handle this year on how much it costs to operate and maintain it. We will have a good 11 months of data to estimate how much we will need to put in the budget for 2009 to keep the Government Center operating for a year.”

Between 2006 and 2007, property tax revenues increased by more than $2.1 million – with more than half of that coming from an extra-voted one-mill property tax levy voters approved to pay for county operations including the new 9-1-1 Emergency Dispatch Center in the new Law Enforcement Center. Overall, revenues increased by just $1.7 million between 2006 and 2007.

General fund expenditures increased by some $653,071 between 2006 and 2007 – but those figures do not include the drawdown of the delinquent tax revolving fund and the capital projects building fund to pay for the new $10.6 million Government Center.