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The Babbitt city council meeting appeared to be gliding to an end before questions were raised about city accounting.
“I haven’t received financial reports for the library since November of 2023 so I’m wondering when I can expect to receive them since I need to know how much of the budget I spent and where do I stand,” said Library Director Lisa Pennala.
Clerk-Treasurer Robecca Jaeger responded.
“We just got the go-ahead to start doing the bank recs again so I’ve been working on it,” said Jaeger. “Sarah and i are out on training next week. So after that you should be able to have all of the updated ones.”
Mayor Duane Lossing asked who provided the go-ahead.
“The auditors,” said Jaeger. “We weren’t allowed to touch anything in January’s in our accounting software because they were moving a lot of things around. There was flu that was going around so everything on their end was slowed down a lot. And we had a bigger audit than we normally do so that’s why it was taking a little bit longer. They still actually haven’t came back to us yet, the auditors.”
Jaeger said normally by March the auditor come back with the audit reports. She said the bonding on the wastewater treatment plant required a bigger audit.
“We weren’t allowed to touch anything in the software to do our reconciliation because they were still moving things around,” said Jaeger.
“I don’t understand how an accounting firm can think it’s all right to delay us like this when we have all these departments that are trying to run basically a business,” said Lossing.
He said he would like to talk to the auditor about the situation.
“We’re kind of hoping that within the next week or two that they’ll be done,” said Jaeger.
“So they told you not to do any of this or can’t? Why, it’s a new year?” asked council member Paul Hohesiel.
Council member Glenn Anderson said the audit issue had to do with federal monies received for the wastewater plant.
“That was last year, not this year,” said Hoheisel.
So then we don’t do our books and don’t give our department heads any kind of a guideline on where they are for six months?” asked Hoheisel.
“We’re still doing everything all the daily stuff we just don’t have the updated report for the reconciliation,” said Jaeger.
"This is a shocker to just first hear about this after so much time,” said Lossing.
“To answer Lisa’s question will you have it by the end of May?” asked Hoheisel.
“Was this explained to the department heads why they weren’t getting their stuff?” asked Lossing.
Jaeger said it was and this was one of the reasons the city office was closed for a week.
“We wanted to do the software update just because we can do reconciliation with you know the software well we had to put everything on hold and not do that even yet,” said Jaeger.
“So you didn’t do the software?” asked Hoheisel.
“No we have the software we just haven’t reconciled it because we weren’t allowed to,” said Jaeger.
“So what did you take the week off and do?” asked Hoheisel.
Anderson and Jaeger said old records were reviewed to determine what needed to be kept and what needed to be shredded.
Deputy Clerk-Treasurer Sara Powell said, “Last week while we were closed it was going through all of those shredding everything that needed to be shredded years ago. There’s still a room in the ack in the north wing of 50 years of documents that are all just piled together and haven’t been touched or gone or properly disposed of according to the state’s record retention schedule.”
“So that was the plan for taking the week off then not to do a software update?” asked Lossing.
“No we wanted to do the software update too but we couldn’t,” said Jaeger.
“It’s good for us to know because all of us guys have to answer to the people that own the money,” said Lossing. “I think transparency is good it just so we don’t look like a deer in the headlights sometimes when we’re getting asked 100 questions. My phone rings I know what some of these other guys do too they wonder you know people want to know what’s going on.”
“When I came up here and see what things were going that’s when I got a tour so I guess any council member could have come up at any time and asked all things were going because I did,” said Anderson.
“I get chastised sometimes because I do come and talk to people but these are our employees and I consider them employees so when I come and talk to the people and I don’t you know I talk to every department I talk to everybody,” said Anderson.
He said time wasn’t wasted and the filing work that was done was “totally amazing.”
Hoheisel said the city’s auditing firm needs to be contacted to find out what the hold up is.
The council passed a motion to check in with the city’s accounting firm.
The council also discussed a variety of other issues (see separate story).
