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- Unauditable Declaration
Auditor Yost Collaborates with Rep. Hagan and Sen. Schaffer to Increase Accountability in Local Governments and Schools
Columbus – The Fiscal Integrity Act was presented today by Auditor of State Dave Yost, Representative Christina Hagan and Senator Tim Schaffer. This newly proposed legislation would address the Ohio Supreme Court decision concerning former Stark County Treasurer Gary Zeigler, among other provisions to boost accountability and penalize wrong-doing.
“One bad apple spoils the bunch and the worms must be rooted out,” Yost said. “Being entrusted with taxpayer dollars requires accountability and education – this bill provides both.”
Although the majority of Ohio’s fiscal officers and treasurers do an exceptional job for taxpayers; since taking office in January 2011, Auditor Yost said that far too many were taking advantage of their positions. Recent audits have shown that taxpayers are footing the bill for items such as boxer shorts and purchases at the local golf course. Other audits found that fiscal officers overpaid themselves, and some officials have virtually no documentation of financial transactions whatsoever.
Auditor Yost brought these concerns to the Ohio General Assembly, and Representative Christina Hagan (R-Alliance) and Senator Tim Schaffer (R-Lancaster) offered their leadership and ideas to develop legislation that would increase accountability in Ohio’s local governments and schools.
“I believe, wholeheartedly, that accountability creates an environment where people are less likely to fall short,” Representative Hagan said. “I am glad to work towards ensuring such an environment can exist; where temptation is minimized due to sound controls, further education and the understanding that repercussions are strong against one’s ill actions.”
“As taxpayers we should expect no less than optimum effort and honesty from those we entrust with public dollars,” said Senator Schaffer. “This legislation with Auditor Yost’s insights and guidance will elevate the expectations and performance of our local fiscal officers.”
HIGHLIGHTS OF PROPOSED LEGISLATION
- If an Ohio county, township or municipal government is declared “unauditable” and fails to make a reasonable effort to bring its financial records to an auditable condition within 90 days, the Auditor of State may notify the Office of Budget Management, and state funding may be withheld.
- Training requirements for township and municipal officers will be increased to ensure that those who handle the public’s money are well-versed in Ohio public finance law.
- In response to the Ohio Supreme Court decision following the removal of former Stark County Treasurer Gary Zeigler, this legislation will create a uniform removal provision and due process for county auditors and treasurers, municipal fiscal officers and township fiscal officers.
Public School Districts
- If a public school district is declared “unauditable,” the treasurer responsible will be suspended until the audit is completed. The state board of education can suspend, revoke or limit the license of the treasurer.
- Within 45 days of the “unauditable” declaration, the school must present a plan to the Auditor of State. If the district has not made a reasonable effort to bring its records to an auditable condition, the Auditor of State may notify the Ohio Department of Education, and state payments may be withheld.
- Once the audit is completed, the Auditor of State may ask the Ohio Department of Education to release the funds – much like the current rules regarding Ohio’s charter schools.
- All community school treasurers will be required to be licensed under Ohio Revised Code Section 3301.074 – in the same way that Ohio’s public school treasurers currently are licensed.
- In addition, all community schools must deposit a $50,000 bond to cover the costs of any audits after the school closes.
- Like the rules for public schools, a community school treasurer will be suspended if the school is declared “unauditable”, and the state board of education may suspend, revoke or limit the treasurer’s license.
- Also, upon an “unauditable” declaration, the sponsor of that community school may not open a new school between 90 days after the declaration and the date the financial audit is completed for that school.
Finally, for those egregious offenders, any fiscal officer or treasurer convicted of dereliction of duty would be prohibited from holding public office for four years and may not hold another office until any repayment or restitution required by court is repaid. The dereliction of duty conviction would also be reclassified as a fifth degree felony.
The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,600 state and local government agencies. Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.