It started with the very first speaker addressing the Palm Coast City Council Tuesday evening: “I’m here to demand” — he underscored the word, pausing on it for for effect– “that the city of Palm Coast approve and fund a full and comprehensive forensic audit through an outside professional forensic auditing firm. The city has never had one performed and has fought it every time it’s been proposed. Why? If there’s nothing to hide, then our city governments should be in the sunshine.”
The speaker was Ken McDowell. Eighty minutes and two dozen speakers later, the council had consensus for doing just that.
“Based on a lot of the comments today, I would like to direct staff to look into what we need to do in order to have a forensic audit,” Council member Theresa Pontieri said. She acknowledged that annual audits are conducted, but asked for the forensic kind. Council member Ed Danko seconded.
Mayor David Alfin and Council member Nick Klufas raised issues of cost: a forensic auditor can charge between $250 and $500 an hour. But they did not object: Alfin directed the city manager to inform the council on cost and timelines before beginning to discuss parameters. Klufas later clarified that he was not supportive of the forensic audit at this point–only of “how much this witch hunt would cost.”
Danko had sought to clarify whether the audit would be “all-inclusive.”
It may not be. “It’s a long, complicated process. So before you start cherry picking, I think you should understand the entire process,” Alfin said, as the council agreed to have a workshop presentation soon about the process.
City finances are audited independently and thoroughly every year. Those audits are based on the testing of controls, sampling of transactions and financial statements, analyses of financial information and reconciliations, among other steps. (See the 2022 audit.) It isn’t in an auditing firm’s interest to be sloppy, let alone to fudge numbers or be dishonest: a firm’s reputation as much as a government’s depend on transparent audits.
A forensic audit is a far more detailed and expensive process that drills down to individual financial records. It is generally–but not always–predicated on an assumption or suspicion of wrongdoing, and backed up with at least a glimmer of evidence. “A forensic audit is used to uncover criminal behavior such as fraud or embezzlement,” an explanation of forensic audits on Investopedia states. Forensic audits are more common (and more necessary) in the private sector, where books closed to public inspection are more easily manipulated.
Public demands for a forensic audit, and council members’ surprisingly pliant surrender to one, could cast a pall on the administration in general and the financial department in particular. Yet not a single member of the council spoke in defense of either, or qualified the move toward a forensic audit at least as a placating measure for the public’s peace of mind as opposed to an aggressive investigation of city funds necessitated by probable cause.
There has been no evidence, however–no hints, no suggestions, no allegations–of financial improprieties within Palm Coast government, which has annually received commendations from independent agencies for transparency in financial reporting. What there has been, and what there continued to be on Tuesday evening, is a repeat of the same vague, general complaints about city operations–taxes, fees, spending, development–that reflect an undefined malaise that critics want addressed one way or the other. In that context, a forensic audit appears to be more of a scapegoat than a solution, and an ironically very expensive one.
to the council, the demand for a forensic audit is motivated more by general dissatisfaction with a mishmash of issues, McDowell’s opening comment was emblematic of several comments that followed. The comments were laced in vague allegations and numerous inaccuracies or outright falsehoods rather than in any basis in fact, the language overheated by innuendoes and conspiracies.
McDowell’s brief statement alone included complaints about the city being supposedly controlled by its Orlando attorneys and why the city doesn’t have its own in-house attorney when, in fact, the county’s in-house shop of attorneys, budgeted at nearly $1 million, is 42 percent more expensive than the city’s $685,000 contracted service. It included baseless charges that the city’s new garbage contract is “corrupt.” It included the false claim that the city’s utility fund is being used as a “cash cow” to fund other parts of the city budget (it is not). It included complaints about “how our tax dollars are spent,” and how “very few of those decisions benefit us taxpayers and certainly benefit real estate developers, residential and commercial,” such as rezoning decisions that have aided a boom in residential development.
Based on those misconceptions and inaccurate premises, McDowell called for city employees to “step forward” and contact the State Attorney’s Office as whistleblowers who “can remain anonymous and not have your livelihood threatened,” or contact him, “to expose the nasty underbelly of our city government.” City employees, of course–past and present–could have always stepped forward.
Equally remarkable was the council’s silence: there was no defense of the city administration, though the public comment period was followed by proclamations, one of them praising the city’s utility department.
Barely known or mentioned by the broader public for decades, demands for forensic audits have been surging since the end of the last century, in tandem with the surge in skepticism about government or with anti-government rhetoric. The demands for forensic audits in the context of government budgets has been closely associated with ideological rather than good-governance motives. The use of the terms in the broader culture is at an all-time high, as it was for the City Council Tuesday evening. The context and the manner of the council’s decision were as notable as the fact that a forensic audit in the city was unprecedented. None has been conducted in a local government in at least 15 years.
The city’s books are open to the public for inspection. The various accounts are occasionally misunderstood: even elected officials at times have difficulties differentiating between self-sustaining “enterprise” accounts like the city’s utility department or the stormwater fund and the mostly tax-funded general fund. The varieties of accounts and their jargon-ridden terminologies can seem arcane and impenetrable, at least at first glance. They are also easy targets for misinterpretation, with assumptions of malfeasance filling in where ledgers and fine print are too much to bother with.
“I hear of too much going on here from people that have been here for years. They’re very concerned. That’s concerning,” John Furlong said, without providing an example of something concerning.
A woman who referred to “legalized larceny” said she “can’t believe we’ve never had a formal audit,” and called for cutting “10 percent of the fat,” (without giving an example). A woman wondered how, with all the new construction, the city couldn’t generate enough revenue to afford its needs. A man wondered along the same lines how the powerful real estate market hasn’t generated needed revenue and why a 30-year utility fee would be needed to compensate for it, and yet another, reading from his laptop posed on the podium, claimed that the utility franchise fee was “likely a violation of the United States Commerce Clause” (it is not), and will face legal challenges (it has, and been ruled legal by Florida courts).
“Water bills and other bills are getting out of hand,” one commenter said, claiming–falsely–that other cities “are not charging additional fees” (water and sewer rates alone have risen 50 percent in the past decade across the country.)
Ironically, some of the speakers also demanded that the city address “the condition of our stormwater system,” just weeks after a public outcry against the city raising its stormwater rates substantially to address those very issues.
Wherever there are accusations and misinformation, Dennis McDonald is not far behind. He was there Tuesday night, opening his statement with a salvo against Mayor David Alfin: “I understand that there was a media post that was put out, okay, where you refer to a great many of us as ‘loudmouth minorities.’ And so, I’d like to thank you. I guess I’m one of those loudmouth minorities,” McDonald said, riling the crowd behind him to applause and causing Alfin to use his gavel.
“If you’re going to stand there and fabricate things that are not true, you’re going to err on the wrong side of public comment,” Alfin told McDonald. “So I give you a warning.”
This time, McDonald wasn’t wrong: he had quoted Alfin accurately from a Flagler News Weekly interview on July n31 when Alfin said: “I will always follow the hearts of all the people and not bow to any louder mouth minority of residents.” The comment, however, could have applied to any loud-mouth of any political persuasion. It was curious that McDonald so earnestly recognized himself as one.
McDonald went on to remind Alfin of the way he and the city worked “very hard to do everything they could to stymie the increase in the [impact] fees that were being charged by the educational system here in town,” the fees that help the district build new schools and that had been notoriously underpriced for years. On the other hand, the district’s enrollment has been stagnant for a decade and a half, and McDonald was inaccurate to claim that the city led the way in opposition to the higher impact fees. That was the doing of the Home Builders Association and its local echo chamber of commerce, though Alfin was by no means a fan of the higher fees. Alfin invited McDonald to a meeting with him.
There was a variety of comments that had nothing to do with any need for a forensic audit–from Josh Fabian and Nathan Phelps, the supporters of enabling backyard chickens, and several others supporting them and the initiative; from a representative of a woman speaks for the Pace Center for Girls; from a woman and a man who separately appealed to the council to “reconsider prayer at the meetings” (the council does, in fact, provide for the lengthiest moment of silence at the beginning of meetings, for prayer if those in attendance so choose, than any local government), a woman spoke in defense of a wetland, and a man who asked for a more permissive city policy about small commercial vehicles parked in residential areas.
The meeting chamber was full, however, and the overflow crowd had to be accommodated in a separate room, all drawn to City Hall on fears that the council might yet find a way to pass a new utility franchise fee, the effort that fell short again. Danko, who is running for a seat on the County Commission seat, had again rallied his troops to fill the chamber based on that fear. He was triumphant Tuesday evening, having also won a campaign talking point regarding the forensic audit. But he said the audit was not his initiative, and that McDowell was proposing it on his own.
“I think it’s clear to me at least from the public reaction to the city of Palm Coast does not want a franchise fee on their electric bill or or anything else,” Danko said. He attempted to have a motion passed that would require a referendum before a franchise fee is even considered. He didn’t get it to a vote Tuesday evening, but did manage to have an ordinance prepared to that effect for possible approval subsequently.
At the end of the meeting, when council members get a chance to speak on any items they choose, some commended each other, some commended a retiring driver-engineer in the Fire Department, some commended Fire Chief Kyle Berryhill, most commended the audience. None said a word that could dispel the pall on the city administration that the historic call for a forensic audit has created.
Ban the GOP says
with the republicans owning every office in the state even if they find blatant corruption they would cover it up or sabatoge the person that finds it.
Did you know taxpayers of flagler raise millions of dollars a year to help homeless people. Show me where one dollar of that went to help a homeless person like ever……….
How much do we spend to fly that helicopter around the county?
How much did the moldy building cost us?
did you know if police officer violates your rights and you win in court the city pays it not the police department?
Intersting how they will dismantle teachers union but not police..
system is working great 3 individuals have more money than 200 million americans combined and pay no taxes. sounds sustainable.
usa= Privitized profits and shared losses. Keep voting for profits over people.
Ed says
A municipal forensic audit is usually conducted upon suspicion of, and or corroboration of some type of embezzlement or fraudulent activity that is discovered.
The issue will be the interpretation of the findings that a forensic audit will expose. Just for a moment let’s believe that there was not any malfeasance but only accounting errors or postings to wrong accounts. That’s good except the bill to discover that may spill into the hundreds of thousands.
On the other hand, if something nefarious was taking place, then a criminal investigation and prosecution follows. That’s not free. And we must hope that restitution could be achieved.
Panama City just completed their forensic audit last week at a cost of $175,000. They had had evidence to warrant the audit, not a group of citizens casting aspersions because they believe the Republican leadership is inept.
Hopefully, there is some middle ground where the audit looks at a “sample” and then a decision to move forward can be rationally made.
For Real says
Yes the taxpayers of PC want a forensic audit down. Lets see if someone has sticky fingers.
Danm says
You can always step forward go to HR and get laid off , @60 yrs old by Flagler County losing many years on a job I was good at. Thanks Flagler County. Blow whistle lose job.
protonbeamexposure says
The fact this community is still bullied by trump trash like the hamburger man and STANKO is disgusting in and of itself. How someone can wreak so much havoc and spread so many lies and have any credibility in the community speaks volumes about Palm Coast. He lies and lies and lies – it is his tried and true tactic, sadly it apparently works.
tulip says
It’s the Republican way of conducting themselves now, especially those that belong to the Maggott group.
JimboXYZ says
They’re going to find fiscal incompetence instead. Splash Pad, the consulting experts & that litigation, 2 moldy buildings for FCSO, Pickleball & Tennis court expansion. Then there’s more sports fields for a Field of Fantasy Dreams. Dare I say the high speed internet connectiviy that’s supposed to attract industry. What do we have Boston Whaler expanding operations from Volusia County (Edgewater, FL) => Palm Coast in a once shuttered boat manufacturing facility. Advent’s new hospital. Outside of that the growth of commercial expansion here has been retail that is going in between the airport & I-95,the rest of it is residential. And that doesn’t even cover the hires & fires that cost money for executive level employee searches for higher paid replacements. even the new FCSO facility, that required the addition of a warehouse for all the seized property. The latest Superintendent search, they want to pay that new hire nearly double what the last Superintendent was being compensated. Unless I missed something, that should about cover the last 5 years of the scorecard for Palm Coast. I know I’m forgetting something in that list. I include increased budget for FCSO with the new Sheriff’s facility, gotta hire more officers for a new building that cost $ 21 million as I recall. Another ? There are new schools to be built for the projected overcapacity, that at last report wasn’t overcapacity wasn’t happening as the City of Palm Coast /Flagler County became a top 20 growth destination, yet impact fees to repave roads is inadequate.
K says
They began sidewalks on Bird of Paradise Dr which only go half way down the road. No signs of completion. Kids almost getting hit. The bridge near Buddy Taylor for kids.. yet we got a crossover bike trail, city council got raises and all members had time to discuss chicken pilot program.
Every project seems to be double the estimated cost and/or never finished. Hard to tell if it is fiscal irresponsibility or blatant fraudulent coverup. They also have mismanaged city contracts with companies such as Waste Pro. Either way, would love to see line item budgets and which companies are getting these projects.
Our biggest concern is the poor drainage that plagues pockets of Palm Coast. Last week, for DAYS, some areas were flooded with water but if you drive 5 minutes down the road, there was no evidence that it had even rained. Huge concern for home owners and insurance companies.
BradW says
Kay,
The sidewalk on lawns on Bird of Paradise goes back I believe before incorporation in 1999. It was here when we moved here in 2004 and was a test that proved that it’s not viable throughout the entire City. For one, the City would need to get right-of-way permission from every owner on a street since the path is beyond the City’s boundaries. I know I would never agree and many many others would not. Likewise, it came with drainage problems be taking away a lot of ground to absorb rain water.
The bridge near Buddy Taylor is mainly a piping and stormwater project that ran into complications when they were able to get underground. If you go to the ‘W-1 (Belle Terre @ BTMS)’ project you will see a detail. https://www.arcgis.com/apps/dashboards/db9a4ce73f774bdfb5dea84e01b2790c
What are all of these projects that “seems to be double the estimated cost and/or never finished.”? You can easily see the projects, project details, and progress online at the link above. In addition you do know that bids are public and you can see them via the City’s website? What exactly is being kept from you?
Yes, our drainage system is a natural drainage system and significant rainfalls can take a while to absorb into the ground. This is especially true with multiple heavy rains in a short period of time and the ground gets over-saturated. Homes are not flooding and are not going to flood.
Deborah Coffey says
Whiny, whiny, whiny Republicans. They keep voting for their own tribe members and then whine about them, too. If happy Democrats ran Palm Coast, they’d be miserable about that, too. The problem: they want everything their own way but they don’t want to pay for anything. I’m not saying that Alfin and the Council are doing a good job…far from it. But, I don’t believe they’re corrupt; I believe they’re totally incompetent like most of today’s Republicans. Maybe if they just hopped onto Hunter’s laptop, the people here would be happier.
TR says
Oh and the Democrats are competent? They are competent at covering things up. Just look at the white house leader and his corrupt family. This has nothing to do with Republicans. It has to do with doing the right thing after taking an oath. Unfortunately for years people in power think they can get away with more and more then the people before them. When I was a kid, small city government elected officials did what they swore to do for the residence of the city they ran in. But now it seems that they are looking at what the bigger government officials are getting away with and so they are following suit.
Deborah Coffey says
You can’t prove one thing you’ve said about Joe Biden and his corrupt family and neither can the Republicans in Congress. THIS has EVERYTHING to do with today’s Republicans…EVERYTHING. They are cheats, liars, and the most ANTI-Americans we’ve seen in decades…as are all of their followers. It’s time for truth. It’s time to call the entire GOP exactly what it is…ANTI-Americans trying their best to completely destroy the country and all of its institutions.
You heard Ron DeeSatan say he’s “slit throats” on his first day in office? You heard Marco Rubio say, “That jury’s a joke. The whole case is a joke.” Complete destruction of America. I think they should all be arrested for sedition.
Celia Pugliese says
For once I think the forensic audit will clear for taxpayers the details of our utility “enterprise fund” and show if was used for loans to the city from its reserves or not? Will be 150,000 to 175,000 well spent. Was worth in Panama city as reported: https://www.wjhg.com/2023/06/28/panama-city-commissioners-see-forensic-audit-results/
Also maybe will show us how much in impact fees we get from each development of thousands of house units/multifamilies and if those impact fees are enough for the new infrastructure and services needed like schools, roads, utility water, sewer, storm water, garbage, parks, fire. police etc. We should receive and displayed in every presentation of a new development to be approved with the total cost of impact fees documented to be contributed by the developer. Is not enough for us that our city attorney said that the amount of impact fees are in the developers application, we want to be disclosed in detail each of them. Then we may realize why is that in the last 10 years with all the housing boom we have, haven’t seeing one new road or widening of existing one’s like Old Kings Road with all the new vehicles added by the growth to our traffic. All the tear and wear in our roads caused by the loaded semis serving the construction needs of all this growth approved! Engineering dept. want us to fund to the tune of 12 millions a year, until Councilwoman Pointieri contested it with a less expensive approach! Thank you Theresa.!
Yes we need a forensic audit…former councilman Jack Howell wanted one back then…so is time for one. Money well spent. Back then
Celia Pugliese says
Thank you all that attended the meeting. The city had to send the city hall overflow of 25 residents to an adjacent room as a multitude attended. opposing any new higher taxes or fees. Thank you all for caring for the preservation of our quality of life and value of our homes in spite of being called “loudmouth minority” and also “negative ignorant vitriol” by Chamber Blasoe and also misinformed ignorance by FPCHBA Mrs Long. Maybe as complaining residents are always undermined by these same VIPS of some local organizations like the Chamber and now to the Home Builders Association we should also join in a large group for better representation like “Protect Palm Coast” and be better prepared to withstand the unfair name calling. This institutions representatives seem to forget that the number of residents are larger that their memberships of 500 to 800 that they count and they wait until the residents leave the meeting to present their negative critique against us all resident taxpayers. https://www.youtube.com/watch?v=ZBI9i3rRTew&t=5697s . If I would be in their shoes, I will never use derogatory description of our residents attending government meetings to validate their rights and needed services! Because these are the institutions attending private city meetings with our elected and administrators as reported were we the “Loudmouth Minority is not invited to witness” and speak as well. I also want to appreciate Councilwoman Pointieri for answering my concern on the annexation of 330.8 acre future housing plans to be presented that may be affected by the many students in the flight schools practicing in that area adjacent to the airport “she was reassured by planning that will not be an issue”. I would say from now on residents need to formally request that with every new development presented the amount in detail of total impact fees to be displayed for us all to be contributed to each; schools, roads, city utility, parks, services law enforcement, fire, etc.
Ed says
A forensic audit reviews accounting practices, ledgers, journals, and balance sheets.It will not provide any information if an approval for a development was appropriate.
It sounds as those of you in favor of the audit really want a review of all actions of Palm Coasts’ permitting and economic development permits and approvals.
I would submit that you are confused about what the audit will do. You probably are expecting more of a review of policies and procedures from an outside consultant and engineering firm to validate decisions made by city council.
Don’t ask for a colonoscopy when you really want to know what they ate.
Pogo says
@Ed
Do you sell cars — if not, you missed your calling.
I’m trying to recall if you’ve ever made a comment on this site that wasn’t a salad of mixed metaphors, non-sequiturs, and ordinary nonsense, aka, putting words in others mouths, answering questions that weren’t asked,
and changing the subject without cause, and/or explanation.
No. Not ever.
Unrelenting bad faith. Yes.
The people who add forensic to every mention of an audit are of the same ilk as the target audience for spam mail scams selling anything with the word tactical as a prefix. Do you disagree?
Transparency is what is needed. And elbow grease and good faith. Scarcer than chastity in whorehouse? Sadly, yes.
Related reading
bad faith argument
https://www.google.com/search?q=bad+faith+argument
bad faith argument tactics
https://www.google.com/search?q=bad+faith+argument+tactics
Ed says
@pogo
H e l p me out, I’m a bit confused. Are you with me or against me.
You and Kamala are the king and queen of word salads.
Sorry, I don’t rant like a wacko and I try to bring some common sense to the discussion. I never reference community leaders with disrespect or names.
Sarcasm yes, name calling never.
Pogo says
@ed
I said what I had to say, and you cried me a river, but addressed nothing.
It is known:
https://www.google.com/search?q=A+Hit+Dog+Will+Holler
Dennis C Rathsam says
Ive been complaining about the strange things that happen at City Hall for years now! I keep saying theres something rotten is P/C. Nobody listened, I guess nobody cared back then. Yes we can talk about the million dollar moldy building, And that splash pad…OH MY! Other towns have one, they all work, not here, The ghosts of past, I guess will take the blame, & mark my words, the city will lose in court, on this pad from hell. Nothing gets fixed the right way. P/C is the city of do overs. They over spend, & cant live within thier means. Spend money on this, spend money on that, next thing you know our taxes go up again. Pipes in the ground are bursting, because of non existing maintenance, traffic is a nightmare, streets are falling apart & our school board is lost in space! P/C used to play a song when U were on hold, Find your Fl. I did…. then in a span of 11 years….THEY DESTROYED a once quiet, bedroom comunity. Who will stand with me and say enough is enough? And put a stop to it. Or will you bend over time & time again to this madness.
jeffery c. seib says
I must say that I am having a hard time figuring out the need of the city of Palm Coast for a ‘forensic’ audit of the city’s finances. Just because a member of the public gets up and speaks during the meeting that there is corruption in the financial reporting shouldn’t set off a rush to judgement by anyone. No specific evidence of any wrongdoing was mentioned, and this is a slap in the face of the entire city staff because the implication was that a crime is being committed with the accounting. Part of the problem is with the totally confusing presentation of the financial picture by city staff. It could be a lot simpler and easier to understand by us all. We all are familiar with budgeting so the presentation should be made appropriately nuanced for all to see.
Eminence Front says
Jeffrey,
You’re not wrong. I think people are just looking for a scapegoat. Everything in their life that has ever not gone their way has been someone else’s fault. Classic externality. Rather than self reflection and responsibility, all disappointments arise from a grand conspiracy.
We can all agree our leaders in government at every level are disappointing. We voters are to blame for this. We are broadly uninformed and disinterested until we jump to conclusions and play the blame game when failures happen.
I don’t think most citizens are up to comprehending the complexity of budgets, setting tax rates, and reviewing monthly financial reports. But I also don’t think our elected officials are up to this task either and so they take the easy path and let someone else figure it out.