Island Park improves budget practices

In late February, State Comptroller Thomas DiNapoli’s office released the results of an audit of the Village of Island Park. DiNapoli’s office recommended some operational changes, which were to be included in a Corrective Action Plan and submitted to the comptroller within 90 days.

The village submitted its plan in late May, addressing all of the concerns raised in the audit.

“CAPs provide an opportunity for the [municipality’s] governing board to communicate how audit findings and recommendations will be used positively to improve operations and internal controls,” Kate Gurnett, the assistant director of communications for the comptroller, wrote in an email. “Although implementation plans may be designed by key officers and managers within the local government or school district, the governing board … must review and approve the entire CAP. We believe the governing board’s oversight of the CAP process is important because it sends a positive message to the public and to employees about the ‘tone at the top’ regarding the board’s commitment to safeguarding assets and making government operations more effective.”

According to the financial review, during the audit period of June 1, 2008 to Dec. 31, 2009, the village failed to develop “structurally balanced budgets,” which created deficits. The village also did not maintain proper records of some of its inter-fund transfers and did not have a long-term financial plan in place. “The cumulative effect of poor budgetary practices and over-expending of appropriations places the village at an ongoing risk of deteriorating financial condition,” the report read.

According to Mayor James Ruzicka, the village immediately began addressing the concerns raised by the audit, and will continue working to improve operations.

The audit discovered, for example, that six village employees accrued more vacation time than they should have been allowed. Ruzicka said that the village has corrected the oversight. “That was something that came out in the very beginning of the audit,” he said. “So all this year we were working … to catch up on that, so all of our employees are now caught up.”

Ruzicka explained that the village has instructed all of its employees that they must either take their vacation time or lose it. “What happened is that we’ve been understaffed for several years,” he said, “and our employees didn’t get the opportunity to use a lot of their time.”

A major point brought up by the audit was the transfer of $193,000 from the village’s capital fund to the general fund before Ruzicka took office. The money was never replaced.

“We told [the comptroller’s office] that when the sale of the property on Pershing Place is finalized, that money will be put back into the capital fund, and a list of formal capital projects will be set up and priorities will be listed on that with costs,” said Ruzicka, referring to property that the village is trying to sell on Pershing Place — a process that is being delayed by a lawsuit filed by a resident who claims the sale is illegal.

“We’ll do a very extensive capital works layout,” Ruzicka continued. “We have in the past, but we just didn’t have the money.” He estimated that the sale of the property would generate around $250,000 for the village. Meanwhile, the first project on the list of future projects would be remediation of Little Beach, which is being lost to erosion.

The Board of Trustees has begun reviewing the village’s finances every month at village board meetings. The extra scrutiny was another suggestion of the audit.

Ruzicka said he believes the extra measures have already started to pay off. The village’s bond rating was recently increased from BBB+ to A-, and the village will most likely end the fiscal year with a surplus of around $30,000. It will be the first time Island Park has had a surplus since Ruzicka took office.

“Out of a $3 million budget, if you’re hitting it within $30,000, you’re watching it,” he said. “And we have been watching it.”