BAKER — Mayor Harold Rideau vowed Tuesday night he will not sign a contract by Postlethwaite & Netterville to audit the city’s books for the 2013-14 fiscal year for a maximum fee of $62,500, even though the city council authorized him to do so.
Rideau said he had a verbal agreement with the firm to cap the fee at $55,000, which is what the city paid the firm last year.
The matter reaches back to last fiscal year, when the city was cited by the state Legislative Auditor’s Office for various procedural problems. CPA firm Faulk & Winkler helped the city correct some of those issues in the 2012-13 fiscal year and P&N conducted the city’s audit for $55,000.
Rideau said he met with P&N representatives earlier this month and the verbal agreement was made then about the $55,000 cap for the 2013-14 audit.
However, the contract P&N presented to the council and the mayor at the Aug. 12 council meeting set the maximum fee at $85,000, an amount Rideau declared unacceptable.
The council met with the firm again and negotiated a cap of $62,500, an amount council member Joyce Burges said she thought Rideau would accept.
On Tuesday, the council voted 3-1 to authorize the mayor to sign the contract at the $62,500 cap. Council members Burgess, Charles Vincent and Robert Young voted to allow the mayor to sign. Pete Heine cast the dissenting vote. John Givens was absent.
“This is not what I agreed on. I’m not signing,” Rideau insisted.
Heine said, “Everyone says everything was cleaned up (in the city’s books). If it is cleaned up, the price should be less than last year, not more.”
According to the city charter, the council can appoint an auditing firm, but only the mayor can sign a contract with the company. The council voted to appoint P&N last year.
The $55,000 fee was agreed upon before the firm knew that the city court would be included in the audit, P&N representative Rodney Combs said.
Rideaux, however, said the city court was included in the 2012-13 audit.
He added that there is only $40,000 in the city’s budget to pay for the 2013-14 audit. The city court has $5,500 in its budget that can be tapped to help fund the audit.
Burges pointed out that during Faulk & Winkler’s cleanup of the city’s books last year, the firm found $85,000 the city was owed in a rebate from a bond company and the extra money was used to help offset the cost of hiring both Faulk & Winkler and P&N.
“If something like that happened before, then by the grace of God, let’s hope it happens again,” she said.
The proposed contract states P&N would be ready to start work on Sept. 2, and a delay could be detrimental to the city, Burges said.
“We need to be audited and we are slowing things down by this constant rhetoric,” she said.
This story was changed Aug. 27, 2014, to reflect the audit that Postlethwaite & Netterville performed last year was for fiscal year 2012-2013. It’s also the fiscal year the city was cited by the Legislative Auditor’s Office. In addition, this story was changed to reflect that Postlethwaite & Netterville are trying to get the contract to audit the city’s fiscal year 2013-1014.