Ferriday Officials Improperly Paid Out Staff Bonuses, Failed to Follow Required Budgeting Practices

An investigation by the Legislative Auditor’s office found that the Town of Ferriday improperly paid bonuses to employees, failed to follow some of the provisions of the Local Government Budget Act, and did not formally establish the salaries of municipal officers, the state auditor said in a report released today.

Investigative auditors found that between December 2014 and December 2016, Town employees and officials received a total of $40,550 in improper salary supplements or incentive payments. The payments appear to have violated the state Constitution and state law, which mandate that public employees can only receive additional compensation for future work, not for past services for which they already have been paid.

The Town could not provide documentation to show that the salary supplements or incentive payments were for future work.

In addition, auditors found that the Town improperly paid the former Town Clerk $2,095 between October 21 and November 30, 2016. The amount included $1,304 in wages that the Clerk received while she was away from work for childbirth and $791 she was paid in error after becoming the Town’s Grants and Compliance Clerk.

Such payments could be considered a donation of public funds, which would be a violation of the state Constitution and state law.

Town management also did not comply with the Local Government Budget Act, which specifies how political subdivisions of the state are to adopt, implement, and amend their budgets. Auditors found that officials failed adopt the 2017 Town budget before the start of the fiscal year, which is required by state law. In addition, when the budget was approved, auditors said, it did not include the legally required budget message or such information as year-to-date actual and estimated fund balances.

State law also requires municipalities to establish the salaries of municipal officers through an ordinance. Auditors could not find any records to show that such an ordinance had been adopted.