West Haven City Hall
Brian Zahn / Hearst Connecticut Media file photoWEST HAVEN — Despite a forensic auditing firm determining that roughly $100,000 in compensatory time payouts to salaried City Hall employees was disallowed under U.S. Treasury guidelines, the city will not owe any Coronavirus Relief Fund money back to the federal government, according to the city's top finance official.
Last April, a forensic audit report by CohnReznick commissioned by the state Office of Policy and Management determined that roughly $900,000 of the city's $1.2 million allocation of CRF funds was ineligible under Treasury guidelines. Finance Director Scott Jackson, who was hired after auditors completed the majority of their field work in the city, found and presented documentation for most of those expenses for a second statewide audit of CRF expenditures. In late January, CohnReznick reported that only about $100,000 of the city's CRF expenditures were ineligible.
Similar to Bridgeport, which CohnReznick found to have about $700,000 in ineligible CRF expenditures, OPM offered West Haven the opportunity to apply the difference to an eligible pandemic-related expenditure; Jackson said the city opted to apply the $100,000 balance to police overtime.
"We moved the money because it's fungible," Jackson said.
Although the city now is squared up on its CRF grant expenditures, Jackson defended the city's initial use of federal pandemic funds on paying salaried workers' compensatory time — which accounted for almost $90,000 of the $100,000 in ineligible expenditures in CohnReznick's second forensic audit report.
Jackson said the administration believes it to be "financially justifiable" to pay out compensatory time in real time. At the time of his report at Monday's City Council meeting, he said he had been at City Hall for about 12 hours; he said it would not be out of the ordinary for him to report to his office a few hours later than usual on Tuesday morning as a result. While responding to the COVID-19 pandemic in its earliest days, Jackson said City Hall employees did not have that luxury, and the hours they worked were nearly constant. Paying City Hall department heads for the extra time worked, without granting time off, freed the city of long-term liabilities, he said.
"If you hold compensatory time on the books, an hour in 2021 is worth less than an hour in 2029. The quicker you get these liabilities off the books, it's a very sound financial practice," he said.
Otherwise, he said you may have a city health director who takes the summer off or a public works commissioner who works half-time for two months.
Last month, Jackson told the City Council that city officials were worrying about the timeline of independent auditing firm PKF O'Connor Davies completing its audit of the 2022 fiscal year. Jackson said the auditing firm was awaiting the CohnReznick report before releasing its final audit report. If the city does not receive a completed, unqualified audit report before going to market, Jackson said the consequences could be costly.
Councilman Ron Quagliani, D-At Large, noted that he does not believe anything in the January 2023 CohnReznick report reflects more poorly upon the city than the April 2022 report.
"They have not provided us a firm date, but they are aware of our need to get an audit into the system in order to achieve our goals on or around March 23," Jackson said.
