Weitzman’s audit of Parks finds inconsistent fees & control of cash receipts deficient

Comptroller commends department for moving to implement changes

Nassau County Comptroller Howard Weitzman announced this week that a financial review of the County’s Department of Parks, Recreations and Museums’ fee collection process found, while improvements had been made to internal controls since a 2003 audit, further improvements are needed.  Departmental missteps uncovered by the auditors included workers charging unauthorized fees; extending “credit” without proper oversight to some school districts, sports leagues and day camps; and storing cash receipts in a closet. The audit only included museums staffed by County employees.

Following a 2003 audit conducted by the Comptroller’s Office, the department made several improvements, including the implementation of a computer system called “RecTrac” to track cash receipts and strengthen controls.

"I commend the Parks Department for moving swiftly to implement many of our recommendations following the 2003 audit, but more needs to be done” Weitzman said.  “The installation of RecTrac has professionalized the department’s fee collection system and implemented tighter controls over their financial practices in general.”

At the time of this recent audit, the new system had been installed at 15 facilities, including golf. The department also established a Cash Management Office (CMO) to oversee the cash collection process.

"Fees collected at the approximately 34 parks facilities represent one of the largest County non-tax revenue sources,” Weitzman said. “We need to ensure that when residents pay to use a Parks facility, the correct fee is charged, collected and deposited in the county’s bank accounts efficiently.”

The audit initially covered the period between January 1, 2006 through September 30, 2006. In 2007, the Office of Compliance issued procedures for the Cash Management Office. The Comptroller’s Office tested compliance with those procedures for the week ending May 17 for four locations.

The County’s Department of Parks, Recreation and Museums oversees more than 70 parks, preserves, museums and athletic facilities in a 6,000 acre system scattered throughout the county. In 2007, the Parks Department took in $18,301,000; $4,602,000 of that was from golf fees. Other departmental revenues include fees for the use of swimming pools ($1,755,000), cabanas ($1,132,000), golf driving ranges ($1,080,000), golf carts ($952,000), ice rinks ($631,000), athletic fields ($528,000), the Old Bethpage Village Restoration ($404,000) and leisure passes ($383,000). 

The audit found that some fees were incorrectly programmed into the RecTrac system. Out of the 575 bill codes or transaction fees that were entered into the system, auditors found problems with 65 of them. Some charges were different from the fees established by ordinances; there were some fees that were never authorized by ordinance; and there were some fees that staff said had been established by the Commissioner, but lacked required written authorization.

In several cases, unauthorized fees were established at facilities. The Takapausha Preserve offered birthday parties using a fee schedule based on the day of the week; the Aquatic Center charged lower fees to certain swim clubs committing to annual use of the pool and there were also inconsistent charges for picnic areas and shelters at several locations.

"The Parks Departments needs to review all fees and provide each facility with a list of authorized fees,” said Weitzman. “Employees can’t just be making up fees.”

Auditors found that many parks facilities were in the habit of extending credit to various groups who use the facilities, with no formal oversight by the CMO or parks administration. Open accounts receivable at the Aquatic Center totaled $41,466 for permits from school districts, swim teams and the Red Cross. Open accounts receivable from sports leagues and schools were also found at golf courses, ice rinks, athletic fields and the OBVR.

"In one instance, the Athletic Field Coordinator extended credit to a softball league and neglected to follow up even months later to collect the past due amount,” said Weitzman.  “Most County residents pay when they use parks facilities. Parks workers should not have the ability to informally postpone collection or billing for favored users.”

In some instances, the same person who extended the credit, also billed and collected fees—a poor practice, according to the Comptroller’s Office.

"The same person should not do the scheduling, handle all aspects of billing and collection and open the mail,” said Weitzman.

The audit also found some need for improvement within the CMO, the office responsible for making sure the cash deposits are accurate and that they make it the bank. According to the audit, CMO needs to conduct more thorough and regular reviews of the books and management reports to assure that the cash receipts and cash deposits are in agreement; the CMO should also see to it that all facilities are following departmental procedures.

Out of the 35 parks facilities that had cash receipts on hand, two were not storing the cash properly. One location kept cash receipts inside a book on an employee’s desk and another placed cash receipts in a closet.  Other practices that could use improvement are:

- Endorsements of checks - some facilities were not endorsing checks in a timely fashion and not using a stamp.

- Proper signage advising patrons to obtain receipts to help ensure that all cash and credit transactions are recorded in RecTrac or cash registers.

- Tighter controls are needed when collecting parking fees so that all facilities can properly reconcile the fee charges to the number of cars entering the facility.

- Insurance coverage - written standards for insurance requirements need to be established and enforced so that the County is protected.

Parks Fee Collection audit-2008