Posted 2/7/01 Audit of three past years takes 108 hours of study, now Harris Council wonders if there will be penalties By Danielle Strenke During the Harris City Councilís regular meeting Monday, Feb. 5, they discussed a recent audit done by Tautges Redpath. The firm billed the city for 108 hours spent looking through city records for 1998, 1999, and 2000. ìThey put in 108 hours trying to figure out the paperwork,î Mayor Richard Hanson said. He told the council that the audit is complete, and will be sent on to the Department of Revenue and the IRS. Taxes for 1998 and 1999 are still due by the city. ìThey will be sending us bills at a later date, and we donít know what kind of penalties we will incur,î Hanson said. Councilman David Christianson asked if any of the penalties or fees related to the audit would be covered by insurance. ìIím not sure, but if we can get any out of the insurance, we should,î Hanson said. In light of several financial discrepancies uncovered since the departure of the cityís former clerk in December, the city is looking at increasing its bond coverage on city employees. Dave Hermann, of Hermann Insurance Services, was on hand to explain the different coverages already in place for the city. He said both the Mayor and clerk are covered by $20,000 bonds, and the treasurer with a $50,000 bond. General liability is $1 million. ìCan the clerk be insured for more, and what about insuring the council members?î Christianson asked. ìIf you have any exposure in regard to the council handling money, we can do that,î Hermann said. The cityís new policy requires signatures by the treasurer, mayor, and one council member on all checks. Hermann also explained the coverage held on the cityís vehicles, including the fire department equipment and public works vehicles. Councilor Lyle Holmstrom said there were a couple of updated items to be added. ìI donít see the new well house and its contents, or the new tanker on this list, those should be checked out,î he said. Hermann left instructions to come up with information on all of the cityís buildings, to enable the insurance company to compile an updated appraisal list. A new city clerk was hired Monday night and will come on board next week as Mayor Richard Hanson and the city council are working at straightening out the cityís financial difficulties. Kim Hugger was offered the position as the new clerk. She most recently worked as the clerk for Forest Lake Township, which has now been annexed into the city of Forest Lake. Hugger oversaw a population of 8,000 people as clerk of the township. She will begin her duties next Monday at Harris City Hall. Butch Johnson approached the council with a proposal to ìlighten and brightenî the city hall meeting room. ìI would suggest maybe repainting the floor, repainting the walls, making the lights brighter, and ripping these [storage areas] out,î he said. The city had been looking into turning part of the old fire hall into a new meeting room, but has put the project on hold until the complete financial picture has been discovered. The council was in favor of adding a coat of paint and cleaning up the office, but was leery of the cost. ìIím all for getting it brighter and cleaning it up in here,î Holmstrom said. ìAs long as there arenít any surprises in the cost,î Christianson added. ìItís going to be some time before we can have anything better.î Johnson will come back to the council with a cost estimate on paint and other expenses for approval. Mayor Hanson said they need to be extremely cautious in spending. ìOur building fund doesnít have as much in it as we thought. The balance is at $13,000,î he said. Interim clerk Irene Trent said the balance should be around $46,000. Fire Chief John Pelant also talked finances with the council. He said he had finally uncovered budget figures from 2000, which he had requested for several months from the city clerk. He estimated a budget of $23,000 for the fire department for 2001. ìI do want to know the utility costs for the fire hall, and how much the city takes in for fire protection,î he said. He also questioned the cityís accounting procedures. ìItís my understanding that the treasurer receives checks, the money is deposited, and no one knows where it comes from, or where it goes,î he said. ìI would like to see that changed.î Specifically, he said the fire department relief association had received a check, and he had no way of knowing whether the funds made it into the association's account. ìIt was money earmarked for our budget, and I have no way of knowing whether it got there or not,î Pelant said. He also told the council that the figures show a budget surplus for the fire department for last year, and he would like to know where those funds are. The council said it was improving the financial practices to ensure that everything can be easily tracked through the system. In other business, the council: ï Heard from Ken Holmstrom on repair work being done to the grader. Original estimates of around $17,000 remain true. ï Was asked by a landowner when the building moratorium would be lifted. The mayor told him it could be in effect until September, but the Planning Commission was ready to finalize the ordinance. ï Received a report from Ray Benolken, stating repairs were needed to two lift stations in Harris. The council approved authorization to have the repairs made. ï Tabled a request by Qwest to bury a cable along Co. Rd. 9, until the city can hear specifically where the cable will be located near the road. ï Due to Presidentís Day Monday, Feb. 19, set its next meeting for Wednesday, Feb. 21. ©Post Review