Effectively managing financial transactions for city departments can be a task that requires a lot of time and oversight. Although errors are sometimes made, it is important that municipalities keep an eye on their accounts and cash flow. If they fail to do this, there can be serious consequences.
The city of Youngstown, Ohio, is under scrutiny after an accounts payable audit discovered the municipality made unauthorized payments to the Valley Electrical Consolidated of Girard although the company failed to submit payroll records for contractors' work, reports The Vindicator. The business served as the general contractor for a project that included renovations to a Youngstown-owned building.
The news source writes that the city paid a total of $305,568 to Valley Electrical Consolidated, despite the fact that key pieces of documentation were not submitted to Youngstown beforehand, which would have verified payroll for several contractors. The money paid was part of a federal grant, titled the Energy Efficiency Block Grant, that the city receives from the U.S. Department of Energy. After the payment was reviewed, city officials stated that it was "unallowable," and steps are being taken now to fix the issue.