PITTSFIELD, Mass. — A special City Council meeting was called on Thursday to discuss the fiscal year 2022 audits.

 

It was found that the city over-reported more than $250,000 in American Rescue Plan Act funds, which alarmed some councilors and members of the public.

 

"We found that you over-reported two hundred something thousand expenditures between two quarters," Tom Scanlon of Scanlon and Associates explained. "It was with the Ashley Water Treatment Plant, I believe."

 

The facility's chemical storage building was allocated $4.6 million and is supposed to be completed this season.  It is included in the infrastructure category of spending.

 

ARPA funds are run through a single audit, which is an audit of an organization's financial statements and a compliance audit of Federal awards when more than $500,000 is expended in a fiscal year.  The funds are assessed as being high risk because it is a newer program and the auditors say monitoring is important when passing money through a nonprofit.

 

The over-reporting was found in June 2022 and corrected on the federal report a few months later.  Scanlon believes that his office located the error.  

 

"You reported more than what you spent and again, that's a deficiency in internal control that you're reporting," he explained.

 

It was defined as a significant deficiency and "enough to merit attention" rather than a material weakness, which would mean that a material misstatement of the company's annual or interim financial statements would likely not be prevented or detected on a timely basis.

 

The city has received nearly $41 million in ARPA funds that must be obligated by 2024 and spent by 2026.

 

"I will say that portal is not the most friendliest portal in the world," he said about the reporting system used for ARPA funds.

 

At the last city council meeting, Ward 1 Councilor Kenneth Warren and Ward 2 Councilor Charles Kronick had multiple petitions on the matters

 

Kronick requested that a special meeting be held to hear the FY22 audit and the single audit report, both councilors requested that the council clarify the requirement that a single audit be done annually for federal funds, and both councilors requested that the city requires an annual vote to designate an independent auditor.

 

The two had several questions about the audits during the special meeting.

 

"It's been a hot potato issue for the community, and I want the public to know we're doing what we're supposed to," Warren said.

 

Mayoral Candidate John Krol has also made the promise of an independent audit one of his talking points and expressed concern about the ARPA deficiency.

 

There are also over $1,400 of unaccounted funds that have not been located as of yet, Finance Director Matthew Kerwood confirmed.

 

"However, the variance of that $1,400 has not changed in subsequent reporting," he said. "So it's still there. We're working through it."

 

Kerwood added that there has been some rounding within the ARPA reporting that accounts for some of the variance.