P’burg financial audit led to many changes, mayor says

PRESTONSBURG – Though the financial audit recently filed on the city of Prestonsburg’s financials revealed no significant issues, Prestonsburg Mayor Les Stapleton said Wednesday that several key changes were put in place.

“These were issues I inherited,” Stapleton said Wednesday. “And even though it may not have been something that stood out, they needed to be fixed.”

The audit covered the remaining fiscal year of longtime mayor Jerry Fannin. Stapleton, after defeating Fannin for the seat, took office this past January.

One of the issues in that final audit, says Stapleton, was that the mayor was being paid too much.

“We’ve since corrected that,” he said.

In the full audit report, the recommendation stated “We would recommend mayor’s salary be calculated in accordance with Department of Local Government computation.” The audit reflects that Fannin’s salary as of the fiscal year ending June 30, 2014, was $105, 481.

Stapleton’s response to auditors is that his current salary under the new administration is “well below the maximum allowed.”

Another point within the audit, which covered the fiscal year ending June of 2014, focused on allegations related to the awarding of construction contracts that were required to be part of a bidding process.

The audit found no instances of this during the time-frame for the fiscal year of its focus, but, as is part of the auditing process, when bids were looked at for 2012 and 2013, there were instances in which two companies were awarded contracts were there had been no bidding process.

The report shows that that though no problems were found for the fiscal year 2015, Bob White Construction and Jarrell Construction evidently received contracts from the city without a bidding process during those previous years.

“However, we found that there were invoices paid to Bob White Construction and Jarrell Construction,” the report read. “In our limited look at the prior and subsequent fiscal years for projects totaling over $20,000, we could find no evidence that projects were bid.”

The report says there is the argument that the total amount could be attributed to various small projects, but that this would still remain an issue, if so.

“It is the argument that the projects were multiple small projects under the $20,000 threshold for each, but our interpretation of the KRS (Kentucky Revised Statutes) says that if you anticipate the total projects for the fiscal year to be over $20,000 it should be bid.”

Stapleton said Wednesday that Bob White Construction currently has a lawsuit against the city seeking payment for a bill.

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