The Sandy Oaks City Council has violated another state law by not having had an audit conducted and by now having a financial statement recorded with the City Clerk.
The state law is specifically for municipal governments. It requires cities such as Sandy Oaks to hire an auditor every year to audit the city’s finances and to prepare an annual financial statement.
Texas Local Government Code Chapter 103 Audit of Municipal Finances states the following:
Sec. 103.001. ANNUAL AUDIT; FINANCIAL STATEMENT.
(a) A municipality shall have its records and accounts audited annually and shall have an annual financial statement prepared based on the audit.
Sec. 103.002. AUDITOR.
A municipality whose records and accounts are not audited annually by a person prescribed by statute, by charter, or by a person in the regular employ of the municipality shall employ at its own expense a certified public accountant who is licensed in this state or a public accountant who holds a permit to practice from the Texas State Board of Public Accountancy to conduct the audit and to prepare the annual financial statement.
Sec. 103.003. FILING; PUBLIC RECORD.
(a) The annual financial statement, including the auditor’s opinion on the statement, shall be filed in the office of the municipal secretary or clerk within 180 days after the last day of the municipality’s fiscal year.
(b) The financial statement is a public record.
The 180 day deadline mentioned in the law was at the end of March and the City Council never had an audit conducted.
All of the City Council members knew of the law.
Catherine Rendahl addressed the Council in August of 2015 during a Citizens to be Heard segment and requested to know when the City Council was going schedule a Comprehensive Annual Financial Report, also known as a CAFR, for the 2015 fiscal year. The Council members didn’t know what it was and asked City Attorney Leslie Kassahn about the issue. She told them it was something that was usually started at the end of the fiscal year, which for the City of Sandy Oaks is September.
The members of the City Council at the August meeting who were still on the Council after the November 2015 election included Micki Ball, David Tremblay, and Doug Tomasini.
On December 15, 2015, the City Council, including BJ Gillespie and Karen Tanguma, discussed the CAFR again. Mayor Micki Ball stated the following:
I brought this one forward because it’s my understanding it’s part of the CDBG grant, 1 reason, but state code is another reason. We have to have an annual audit done.
Alderman Doug Tomasini also said “It’s required.”
The Council decided to post the job on a Texas Municipal League website for 30 days.
On February 11, 2016, Mayor Micki Ball said she had interviewed a few accountants over the phone, but that all of them were busy due to tax season. She ended the discussion saying
The other thing is, there is no urgency, there is no penalty, there’s nothing that we’re, that’s gonna harm us by not having this done now.