Bay audit leads to questions about ’12 payment
By Dwayne Bremer
Jul 25, 2014, 21:00
A $132,900 check the city of Bay St. Louis received nearly two years ago caused a stir this week, leading at least one councilman to demand an investigation and threatening to call the attorney general's office if he does not get answers.
The city council discussed the city's 2013 audit at separate meetings this week.
On Monday, Ward Five Councilman Joey Boudin asked about a $132,900 check that was listed on the audit as an "unearned income and liability."
The check, which the city received on Aug. 27, 2012, was an annual licensing fees check for gaming devices, officials said.
The city had also received another check a few weeks prior in 2012 for the amount of $117,000 for annual gaming licensing fees, officials said.
Boudin asked Monday if the second check was a double payment and why it was being listed on the audit.
On Tuesday, things got heated when Boudin brought up the subject of the check again with city clerk David Kolf.
Kolf said the check was deposited in the general fund and used for regular city business.
Boudin asked why the money was not shown on revenue and expense reports and why it was listed on the audit.
Kolf said he has been in contact with the state over the past two years to try to determine if the check was a mistake, but he has yet to receive an answer.
He said he and auditor Jennifer Bell have discussed the check and tried to get answers from the state.
Boudin then asked what would happen if the check was a double payment and/or a mistake.
"We will pay that back if we have to," Kolf said.
Boudin said he had previously gotten a different explanation on the matter and then asked that an executive session be held after the meeting to further investigate.
"What are we doing here?" Boudin asked. "Are we running a Ponzi scheme, waiting for one check to come in before we pay the other?"
Kolf sternly denied the accusations and left the meeting before the executive session.
On Friday, Boudin sent an email to Kolf demanding answers.
The email was also copied to Mayor Les Fillingame and the city council.
"I asked for the file you said you created over the past two years by yourself and Jennifer (auditor) with the state on the alleged mystery check," Boudin wrote. "You walked out without asking to be excused when I requested your presence in a closed session for further investigation. Then you turn over the folder to Don (Rafferty). It don't add up. I want that file delivered to the council chambers within one hour from now. If you are unwilling to cooperate with the investigation of council members, you should deliver your resignation letter to the mayor's office today. Failure to comply will force me to ask for assistance from the state AG's and auditors office."
Kolf was unavailable for comment Friday, but Fillingame responded to Boudin's email by saying Boudin was "overstepping his bounds," and that all the information about the check is available at his office.
Fillingame said Boudin's first recourse should be a resolution from the council as a whole, not calling a state agency.
The mayor said he and Kolf have attempted "several times" to verify the exact reason for the check.
"We have gotten answers to most of the questions, but we have not gotten anything official in writing," Fillingame said. "I don't want to make the file public until we have all of the answers in writing. I tell the council all the time, that all they have to do is come to my office and I will get them what they need. I have everything right here.
“We are not hiding anything."
Fillingame said that the reason the check was listed on the audit was because Kolf took an "extra step" to try to verify its origin.
"David was concerned or maybe he did not completely understand what the check was for," Fillingame said. "He listed it on the ledger as unknown and he has asked the state for clarification. We treated this check like any other gaming check and deposited it in the general fund. Until we get an answer, we cannot put it in the revenues on the ledger."
Fillingame said the city did return a gaming check the year before because that check was supposed to go to the city of Bay Springs, but he is confident the check in question belongs to Bay St. Louis.
"We believe this check belongs to us," he said. "It could possibly have been for past-due fees, but we do not have a definitive answer."
Fillingame said the check was also listed on the 2012 audit as "unidentified revenue."
"This check is no secret or no mystery," he said. "David took the extra-high road and tried to verify where it came from, he did not do anything wrong. This does not affect the city operations one bit. All this boils down to is being able to show where the money came from on the ledger."
Boudin said Friday that he stands behind his email and he has yet to hear from Fillingame or Kolf.
"We have been asking for this information all week and we have not heard anything," he said.