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Water tower off Taylor Street, seen  Jan. 8, 2019 in Clinton, where residents and business owners have been impacted by ongoing water quality issues.

CLINTON — The town's Board of Alderman on Tuesday selected Bart Blackledge to serve as an alderman through Dec. 31, 2020, and heard a scathing audit report for 2018 that included 10 adverse findings.

Auditor Minda Raybourne told the board it needs "a top-to-bottom review of your revenues and expenses."

"I don't know any other way to say it," the Franklinton certified public accountant said.

Raybourne said the town needs to do rate studies for its gas and sewer systems because the Utility Fund lost $172,930 in 2016, then $314,236 in 2017 and $310,086 in 2018.

The general fund had to make up the losses from the sewer, gas and water system operations.

The Utility Fund is supposed to make money to help the town in other areas, the auditor noted.

Adverse findings in the audit report included:

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  • The failure to reconcile the utility accounting figures with the town's general ledger, resulting in the auditor having to make a $42,204 adjustment. Misappropriation of town funds could result from the failure to reconcile the books.
  • Not keeping accurate records of utility customer deposits, and not having a separate bank account for meter deposits.
  • Overpaying accrued vacation leave, contrary to town policies, when employees resign or retire.
  • A $58,894 discrepancy between the amount of ticket income reported by the Police Department and the amount shown in the town's general ledger.
  • The General Fund and Utility Fund borrowing nearly $150,000 from the Street and Sidewalk Fund, which receives dedicated sales tax revenues. Low cash balances in the other funds required the borrowing, but it may be a violation of law.
  • Violating the state budget law by spending 24 percent more than budgeted during the year, when the allowable variance is 5 percent.
  • Delinquent payments of federal payroll taxes and retirement system expenditures.
  • The late submission of the audit report, which was due June 30.

On the alderman appointment, six people had been nominated to finish the term begun by Mark Kemp, who took over as mayor last week after Mayor Lori Ann Bell resigned and later pleaded no contest to a misdemeanor municipal financial corruption charge.

Mark Kemp to finish Lori Ann Bell's term as Clinton mayor after Darren Matthews steps down

The six were Janice Bertrece, Blackledge, Dung Doan, Dayshan Harris, Josh O'Quin and John Sanders.

Kemp called for voting on each nominee in alphabetical order, with the understanding that the first person to get a favorable majority would get the post.

Bertrece did not receive any votes, but Blackledge, who was next, received "yes" votes from Alderman Johnny Beauchamp and Alderwoman Mary Dunaway and a "no" vote from Alderwoman Kim Young.

Kemp then declared that Blackledge was elected but could not participate in the meeting until he receives his commission. Later in the meeting, the board was left without a quorum when Young left the meeting.