An audit report released last week by the Office of the New York State Comptroller identified a “prohibited conflict of interest” in the contracts between the town of Andes and a machining company owned by a town board member.
Article 18 of New York State General Municipal Law prohibits municipal officers and employees from having an interest in contracts with the municipality for which they serve when they have “the power or duty to negotiate, prepare, authorize or approve the contract or authorize or approve payments thereunder;” audit bills or claims under the contract or appoint another officer or employee to do so.
“When officials, in their private capacities, conduct business with the municipality for which they serve, the public may question the appropriateness of these transactions,” the report read. “Such transactions may create an actual conflict of interest, or, at a minimum, the appearance of impropriety.”
Shayne Moshier, deputy town supervisor and owner of Romo Machine in Andes, said the town regularly contracts with his company for welding and repair work.
Between Jan. 1, 2018 and Jan. 9, 2019, the town made seven purchases from the machining company totaling $3,029, according to the report, which noted that a review of the invoices submitted by the company did not reveal any irregularities in pricing.
“(The auditors) told us you should do business locally if it’s going to save you money,” Moshier said. “We’re the cheapest ones around here — in all honesty, we’re the only ones around here. Because of the small-town atmosphere, you can’t go around the corner and find someone like us."
Town Supervisor Wayland Gladstone said: “This happens a lot in small towns. We’ll just monitor the situation.”
The comptroller’s office recommended that town officials and employees familiarize themselves with and follow the requirements of Article 18.
“The auditors told us to watch out for overcharging,” Gladstone said. “Shayne certainly doesn’t — I think he appreciates the business.”
The report also found that the town’s bookkeeper, appointed by the supervisor, performed most of the cash disbursement duties, including processing checks, recording transactions and reconciling bank statements, “without sufficient oversight.”
“While the Supervisor signed the checks and the Board approved vouchers, no one other than the bookkeeper reviewed the bank reconciliations, bank statements or canceled check images to ensure that all disbursements made were Board-approved and for proper purposes,” the report read.
“We just needed another set of eyes, so it’s not just the clerk and I and the bookkeeper looking at things,” Gladstone said, noting that the town designated a board member, who is not a signer of any checks, to verify all disbursements.
The report further recommended additional oversight in the handling of the town’s water and sewer billing process, which is overseen by a bookkeeper.
Gladstone wrote in his response, which included the town’s corrective action plan, that the board will establish policies and procedures for water and sewer billing collections prior to the first 2020 billing cycle.
“We’re glad we had the audit — it lets you know what you’re doing right,” Gladstone said. “We were asking what we can do better, rather than getting defensive.”
Sarah Eames, staff writer, can be reached at email@example.com or 607-441-7213. Follow her @DS_SarahE on Twitter.