Grand County commissioners answer questions about missing $500,000
March 10, 2014
HOT SULPHUR SPRINGS—County commissioners worked to shed some light on a tumultuous investigation surrounding the building department, noting the scandal has been traced to a single person.
The county commissioners held a public hearing and discussion on the building department and confusion surrounding its investigation of $500,000 that went missing over the course of 12 years during its regular meeting on Tuesday, March 3.
"We know this creates a very negative perception on the county for sure, but there's also a lot of misconceptions out there," Commissioner Merrit Linke said. "Grand County still open for business."
Commissioners explained the inquiry into the building department involves two investigations, a management one handled internally and a criminal one handled by the county sheriff.
"Some have said we have not been forthcoming, but we do not want to jeopardize that (criminal) investigation," said commissioner Gary Bumgarner.
A statement prepared by county officials stated they've recovered $153,000 so far, although Sheriff Rod Johnson took issue with the term "recovered." The county has managed to collect $153,000 in uncashed checks after sending a letter to contractors and asking for checks to be issued on Jan. 14. However, that amount can't necessarily be subtracted from the missing $500,000, the sheriff said.
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The commissioners explained the missing funds were initially discovered last October while county staff worked on the budget for 2014. Commissioners noticed deposited funds didn't line up with the building department head's budgeted revenue. Initial reaction was that the discrepancy was caused by a computer glitch. As soon as county officials realized that wasn't the case, according to a statement prepared by county staff, the building department office was emptied, computers were seized, and both the sheriff and county attorney were notified. The sheriff immediately began a criminal investigation.
"The trail lead to one desk, and we took care of that almost the next day," Commissioner James Newberry said. "The person who was at that desk was gone the next day."
Once the sheriff started the investigation, he found uncashed checks in the building department amounting to $28,552 and dating from Sept. 15 to Oct. 30. They were deposited on Oct. 30. Those funds are not included as part of the investigation. He would not say whether an employee had been cashing the checks and pocketing the money or if money was taken out of the department's till.
Commissioners said part of the reason it took them 12 years to realize money was being taken from the building department was because a single person within the department handled all cash and accounting.
"We had one person taking the money and balancing it against permits given out, and we trusted that person," Newberry said. "The person is no longer with us."
The commissioners, attorney and sheriff would not state whom that person is, saying they want to wait until the criminal investigation is completed.
"We're in a system where you're innocent until proven guilty, and that person hasn't been charged," Bumgarner said.
Commissioners stressed that mismanaged records and illegal activity only extended to the accounting side of the building department. All paperwork on the plans and permits side was complete and accurate, according to investigations so far.
The county manager and commissioners have since worked to adopt a more stringent cash management policy for all departments. Among the implemented changes is that at least two people within each department will be required to be part of the money handling process.
"Hindsight's 20-20, obviously we should've done more," Bumgarner said. "As a result of this, there will be more checks and balances than there are now."
The sheriff still expects to complete his investigation by the end of this month, at which time findings will be handed over to the district attorney's office for evaluation.
Building department head Scott Penson has held his position for 14 years. The commissioners declined to speak on personnel matters, including why he has been kept on staff but is under probation. They did note 'probation' means Penson does not receive a salary increase and has certain requirements in running the department.
Leia Larsen can be reached at 970-887-3334 ext. 19603.