At Tuesday’s Becker City Council meeting, members of council again spent a good two hours or so pouring over the staff’s response to questions and concerns over the OSA report of Pebble Creek.

 

At the last city council meeting, the members were instructed by Mayor Lefty Kleis to submit questions, comments or concerns via email to City Administrator Greg Pruszinske, who would then forward the questions on to city staff to get answers.

 

Tuesday, the Mayor and council went through the responses as they pertained to each issue in the OSA report.

 

Pruszinske reported the process of reviewing the most recent responses will be an ongoing process at each council meeting henceforth. When questions  get answered at a meeting and a more recent response comes in the meantime, the issue will be discussed at the next upcoming meeting.

 

Once all questions have been responded to, the answers will be merged with the original OSA audit report and presented to Council. The merged report will be kept on file at City Hall.

 

In regards to questions brought forth about the city allowing for free golf club fees, Golf Director Troy Malo identified the golf advisory board members and whether or not they were a season pass holder, how retail items are paid for and receipts given. Malo also said there were no other discounts given other than what the season pass entitles the pass holder to.

 

“If they didn't have a season pass, they didn't receive any discounts,” Malo said. 

 

Malo said the GAB members to date have not been paid, nor have they requested to be paid for their time served on the board.

 

Member Lori Keller suggested the next steps be to prepare a policy for free golf, implement pre-numbered passes and evaluate the significance of any services provided and income reportable under IRS regulations.

 

For golf lessons, Malo stressed he was the only one giving official golf lessons over the audit years. He mentioned Steve Whittaker was only assisting with “lessons” for the junior golf program. Malo also mentioned a teacher, Joe Malone, who taught at Pebble Creek for a short while but was never charging customers nor compensated for his services.

 

Malo said currently, Jeff Running is the only person giving lessons and he is paid an hourly rate and there is a revenue share from the fee he charges for the lessons. The revenue share is an 80/20 split, 80% goes to him as the instructor and 20% goes to the facility. 

 

Member Tracy Bertram suggested the city’s accounting firm provide suggestions regarding policy creation for golf lesson payments and Treasurer Sarah Brunn said that direction was given to the accounting firm.

 

Keller suggested the golf committee prepare a policy for handling golf lessons fees.

 

For pro shop merchandise discounts, Rick Hendrickson suggested council advise with Attorney Scott Lepak and add a policy.

 

The next steps the city is suggested to take include preparing a policy regarding discounts for season pass holders.

 

As far as inventory controls, Hendrickson expressed concern over the fact that physical inventory counts were taken only twice a season. 

 

Treasurer Sarah Brunn said city staff requested the auditor do inventory checks for the years ending 2013, 2014, and 2015 as part of the walk-thru they performed on both the golf and community center operations. Brunn and Connie Robinson did a spot check  Sept. 3, 2015, where a random sampling was taken and verified. An original spot check happened May 4, 2015 when they met with the golf pro shop and food and beverage staff on processes. 

 

In 2016, a spot check of inventory occurred May 27,  by Sarah Brunn.

 

Brunn said Malo could provide further comment on total inventory counts.

 

Suggested action includes creating a policy on inventory counts and evidence of count sheets retained, turn on variance inventory reporting and create a policy on merchandise liquidation.

 

In regards to the destruction and disposal of records, Hendrickson asked  “Are there any other items maybe not called out in the report that we may be destroying that in this new light we should now save?”

 

Brunn answered by saying staff is currently reviewing the records retention policy on where the items identified in the OSA report and other documentation of the golf course falls within the retention policy. She said the sections that seem most applicable are park & rec and finance.

 

Mayor Kleis asked, “Who is destroying records, receipts etc.? Who authorized the destruction and why are we not following our city policy along with statute?

 

Malo answered “staff at the golf course have been purging files they believed to be obsolete after the current year of operations. Staff was unaware these documents should have been kept.” 

 

Malo said staff is reviewing the document retention guidelines and adjusting operating procedures as necessary to comply with the document retention guidelines.

 

The suggested next course of action is to review record retention schedules as it relates to the record retention policy and implement necessary procedures. Bertram suggested asking the city’s accounting firm to address the IRS retention guidelines. 

 

For food and beverage discounts, Lepak said public employees may not utilize their position to obtain advantages not enjoyed by the general public and it does not appear to put the city in the best light and should be discontinued. 

 

Keller suggested the city’s finance director and CPA firm review procedures and recommendation for change in order to have proper segregation of duties.

 

Hendrickson mentioned at the last council meeting about the gap between May 22 and June 5 for deposits. He asked what was the amount of the pro shop deposit for June 5, 2015?

 

Brunn answered by saying, the deposit amount was $878.

 

Malo said, “over the Memorial Day weekend, we had limited staff and the deposits were not cash heavy and the weekend had several days of rain so deposits were light.” 

 

As far as the concerns over the city paying for employees to play in the annual Chamber Golf Tournament, Pruszinske said, The City of Becker supports its local businesses and the local Becker Area Chamber of Commerce and the practice of this issue was started by the EDA many years ago and has simply carried over from year to year. Pruszinske added that even though this had been common practice in the past, it did not seem to fit the public purpose expenditure doctrine and the practice was discontinued in 2014.

 

Bertram added, “The City of Becker is a strong supporter of the Becker Chamber of Commerce and I find it hard to believe there would be legal policy regarding not supporting an area business with participating in a golf tournament. I believe in the past the EDA has supported such event.”

 

In regards to the issue about thefts by golf club employees, the questions raised were “were the employees charged with theft according to normally accepted procedures? Does the personnel policy have a procedure for handling employee thefts? Does the procedure call out the notification to the OSA? 

 

Pruszinske answered by saying city staff acted in the best interests of the city and in the spirit of MN Statue 609.456 Subdivision 1. He said in both instances, city staff took action to stop the theft. In addition, he said, city staff took the appropriate steps to deal with the situations on the personnel and legal sides of the issue.

 

Pruszinske said the police reports were submitted to the city's prosecuting attorney for review and action. Both individuals were prosecuted and found guilty. 

 

“City staff took appropriate action, solved the problem, sent the information on to the appropriate power and worked well internally to protect the city's interests,”

“I see no contempt or disregard for the law. This was an oversight of an obscure law and is easy to correct in the future.”

 

As stated before, as answers to questions are received, they will be brought forth to council at their next meeting.

 

City staff and personnel from Wenck & Associates participated in the opening of bids for the BCC Dehumidification Unit Thurs., June 30 at 11 a.m. 

 

McDowall Companies were the only contractor to provide a bid for the installation of the Innovent Unit.

 

Wenck Engineering staff needed time to go through the bid to discuss the reliability of the bid and what the next steps should be.

 

Due to this issue, the proposed contract and a resolution was not available at Tuesday’s meeting but will be made available at the July 19 meeting. 

 

The next Becker City Council meeting is July 19 at 6 p.m.