A state audit of the city of Williston found several areas of concern, including failure to properly disclose a partnership and a violation of state law regarding closed or confidential meetings, according to North Dakota State Auditor Joshua Gallion.
The audit also identified nearly $92 million in outstanding contracts related to the airport that the city was required to have disclosed in financial statements.
“In looking at the financial practices of the city, our audit found several areas where officials could make improvements to ensure that all information is accurately disclosed in the city’s financial statements,” Auditor Gallion said.
The full report details the city’s failure to include donated capital assets, a joint venture, and outstanding debt obligations in the financial statements.
Gallion said implementing the audit’s recommendations would save the city costs in the future when it comes to preparing their financial statements, as well as improve the city’s fiscal accountability to taxpayers.
“One of the many goals I have at the end of our audits is to leave the audit client in a better position than how we found them,” Gallion said. “I believe we did that for the city of Williston.”
The Williston Herald contacted the City of Williston in regards to the report. City Administrator David Tuan provided the following statement.
“I was not aware the audit was being released, as they just requested more data from us last week that we were working on. I was under the impression they would allow us to respond to the allegation and corresponding request for info before finalizing the report.”
Tuan added that upon the City’s review of the report, a statement would be released addressing its findings.
Key findings from the report
• The city submitted late paperwork on its airport improvement grants, which could result in the city either losing future federal funding, or repaying funding that has been received.
In its response in the audit report itself, Williston said the forms are prepared by an outside consultant. The city airport and auditor staff are going to set up a review process to prevent the condition from happening again.
• City officials failed to cite the specific legal authority required by law for an executive session on Aug. 18, 2018.
Williston said it had been unaware of the requirement, but would comply in the future.
• The city’s joint venture with CG Williston (Cardon Global), created in June 2018, was not disclosed as required. This includes four contracts: $11.9 million for Sloulin Field redevelopment, $1.4 million for XWA airport advisory, $15.9 million for new development management and $20.4 million for master plan development.
Williston said it was not aware of the requirement to disclose the joint venture, and that it will make added effort in the future to comply.
• Conduit debts that are outstanding as of the balance sheet date weren’t reported.
Williston said it will try to find all conduit debt holders to obtain and maintain records for that as required.
• The city’s commitment schedule omitted
$91.8 million in outstanding commitments, mostly related to the new airport, but also for the commitment balance for CG Williston.
Williston said it had a number of outside engineering people, which created a gap in the review process. Now that the airport is complete it anticipates having these numbers in the near future.
• Contributed assets weren’t capitalized in the year they were obtained.
Williston said developers were unwilling to provide the information at the time, fearing it would provide competitors too much information. Engineering staff instead calculated the numbers “as time allowed.”