With a underway, the big question remains: How did this slip past auditors and elected officials for years? Though a total has not yet been released, it is estimated that the amount of money embezzled is well in the hundreds of thousands, and that the activity dates back to around 2009.
Part of the problem seems to be that the finance department had recently not been submitting monthly budget reports to the Board of Apportionment & Taxation and their finance subcommittee. A&T Vice Chair said the last report they received from Sharon Scanlon, who resigned as assistant finance director in light of the investigation, was in May of this year.
"We never received a June report, which is the year-end report, so we don’t know how we ended the last fiscal year. We never received a July report, so we don’t know how we started the next fiscal year. And now that we’re into September, we’ve never received an August report," Tickey said.
Budget reports detailing each department or board's expenditures and revenues are supposed to be issued to A&T by the seventh business day of each month. While Tickey said a couple days grace period is reasonable due to "the ebbs and flows of city government," to not submit for months creates problems in the budgeting process.
"In the past few weeks I've been in touch with and with the mayor and they said they would give them to us, and I’ve got to trust that they will. But even if they're responsive, we shouldn’t have gotten to this place," he said.
Tickey explained that another practice in need of refinement is the city's use of a spending "cushion" when drafting the yearly budget. Many departments request more money than they need, leaving a bunch of surpluses at the end of the fiscal year that can be difficult to track.
"If youre budgeting for $100 but historically have only spent $70, let’s put in $70. If a department wants to do some new things, let's talk about it and we can make those changes, but let’s budget what we know we’re going to spend rather than building in this cushion," he said.
Instead, he and the rest of the tax board to consolidate department surpluses into one contingency source. That reserve fund would be like a savings account, used to protect in times of unforeseen circumstance.
"When you have a cushion in every line item, it adds a lot of gray areas. I think that streamlining the process would be helpful for the city in the long run. The reserve account helps mitigate against risk and keeps the budgeting process extremely honest," Tickey said.
He added that during the city's most recent budget sessions for the 2013 fiscal year, A&T formally recommended the use a reserve account and budgeted to reflect what Shelton's finances would look like if such a fund were in place. The Board of Aldermen "took it out and did not vote in favor of it, and there was actually very, very, very little said about it."
In related news, A&T is currently seeking a new chairman, as Chris Besescheck resigned from the position suddenly in August. He submitted a letter to the clerk's office on August 9, with an effective date of August 30, but never told his board members or made a public announcement. Tickey said he attempted to contact Besescheck multiple times when news of the finance department probe struck, but his calls and e-mails were not returned.
The Republican Town Committee must now find a replacement. Once a candidate is selected, A&T can vote that person in or out.
"I hope that they either select a person or schedule a meeting. We haven’t met in a few months and I absolutely think we need to to carry on our responsibilities," Tickey said.
Calls to both Besescheck and Mayor Mark Lauretti last week were not returned.