Auditor Fitzpatrick identifies several areas in which officials in the City of Elsberry can improve governmental operations

An audit report released today by Missouri State Auditor Scott Fitzpatrick has found several areas in which officials in the City of Elsberry can make improvements to how their government operates. The audit, which was requested by a petition signed by 299 residents, gives the municipality a "fair" rating while identifying areas of improvement that are necessary for how the city manages utility rates and city funds.

"Any time citizens take the time to gather signatures for a petition for a state audit, we take that effort seriously and give it the attention it deserves. We didn't find any signs of fraud in the City of Elsberry, but we did find many areas in which city officials can make improvements that will lead to a city government that is more effective, efficient, and transparent," said Auditor Fitzpatrick. "While the city has disagreed with some of our findings, they seem to agree with the intent behind each of the recommendations, and I hope they will take all of our findings seriously and work to implement the recommendations contained in the report so the people of the City of Elsberry will have the kind of responsible city government they deserve."

The audit report found the Board of Aldermen needs to give more attention to city utility rates, which did not always agree to rates described in the city code. The audit found 1 rate type was underbilled, 3 rate types were absent from city code, and 3 rate types featured other transparency discrepancies. Specifically, the Sewer Out-of-City Residential rate was underbilled by approximately $2,100 for the year ended December 31, 2024. Additionally, the Board has not ensured a recent review, such as a cost study, of the city's comprehensive utility rates has been performed. The report notes an annual cost study is necessary to ensure annual rate increases specified in the city code do not violate state law.

The report also found the city missed opportunities to earn additional revenue as it maintained an average month-end balance of more than $2.3 million in 6 non-interest bearing accounts for the year ended December 21, 2024. City officials were not aware the accounts were non-interest bearing until informed by the State Auditor's Office. Had the funds been placed in interest-bearing accounts for that year, the city could have earned approximately $44,000 to $50,000 in additional revenues.

A review of the City Police Department's seized property found personnel did not maintain complete, accurate records and did not conduct periodic physical inspections. The city also has not established procedures to periodically review cases and dispose of related seized property items. Auditors inspected the Police Department's seized property storage areas and could not initially locate any of the 25 items listed in the seized property system. The next day, the Police Chief found the 25 items in an unmarked box on a shelf in the seized property storage area. The auditors' inspection and Police Chief's call also identified an additional 75 items not included in the system list, the majority of which were guns or drug-related materials.

The report also identifies how city personnel need to ensure prenumbered receipt slips are issued in numerical sequence for all money received for non-utility services, and how the Board of Aldermen needs to improve procedures over disclosing, discussing, and approving proposed ordinances to create greater opportunities for public comment and improve transparency.

The full audit report for the City of Elsberry is available here.