Audit ordered by Jacksonville city councilwoman finds $500M in accounting errors

[Cheshire Cat]

This is being fast tracked to serve Shad Khan and get his deal rolling before the election is decided. If Brown loses, he wants his deal up and running before leadership could possibly change.  This is not a good thing.  I am not speaking to the development itself but because of what Khan asks for in this deal.  He want's the tax money generated in his project to go back into his and his friends investments on the shipyards rather than into city coffers like the rest of our taxes go. He is not doing this with his own money as many in the public believe but rather with the funds and efforts of other investors which have not as yet all been secured in conjunction with smaller amounts of his own money.  He appears to want to cherry pick the parcels on the shipyards he wants as well as indemnify himself and his folks from the 36 million bond issue attached to this property which as a businessman makes sense but what does that imply for the taxpayers?  He also has wording in his proposal that wants to attach to non-profit funding sources.  That should be made clear.  I am all for the shipyards being made vibrant but the city better know darn well all the dollars and liabilities attached to this deal before being rushed into it.  This is a powerful guy using his current influence in city hall to get what he wants when he wants.  A look at so many of the past debacles run through this city should have everyone questioning the competence of fast tracking this deal.  Interesting side note.  The Florida Corporation created for and managed by Khan for the Shipyards development is actually a 50/50 trust for his two kids.  Nothing illegal about that but it shows us that he is very concerned about the legacy he leaves his kids in Jacksonville.  All of us taxpayers should be equally as interested in the legacy we leave our kids as well. A deal that uses public funds to bolster what Khan says will be a 1/2 billion development should at least include the expansion of our tax base as opposed to feeding his own deal from now on.  The city for it's part has got to figure out how it will indemnify and guarantee the 32 million bond deal, clean up the yards, pay for the build out of the mooring for the U.S. Adams, the needed infrastructure to the site and the additional football field he is asking for.  Jacksonville people, we are such easy prey through our own incompetence.  That has to stop.  This deal should not be fast tracked.  Interesting that such a large amount of money is discovered for capital improvements as this is all happening as well.  Wonder where that money will go?  Too many unanswered questions and so much potential for the people to be the continued source of funding via our taxes for Khan's deal. For those who wonder how hard hitting a legal deal could be with Khan if our end is not handled properly take a look at how things happened on the smaller scale of Edgewood Baker.  He had that deal written very well apparently by competent people.  The bakery is now majority owned by him. 

[Cheshire Cat]

Regarding the thread title.  The amount found was 50 million not 500 million.

[urbanlibertarian]

I understood it to be $500M in errors, resulting in $50M that can be spent on pending yet unfunded capitol projects.

[Tacachale]

^That is correct.

[Cheshire Cat]

I had not heard that full equation.  So you are saying that there were mistakes totaling 500 million on both the plus and negative side of the ledger that ended up with 50 million on the plus side?  I appreciate the clarification.  One thing joggling around in the back of my mind is the previous times I and Councilwoman Johnson tried to have just this sort of audit done while Peyton was in office.  That was because I discovered inconsistencies in funding in the Childrens Commission where interestingly monies would be shuffled to certain other areas as needed at the request of Peyton and included some other department inequities. The same was true with the now defunct Faith Based office. Both seemed on occasion to function like secret piggy banks of staff and funding.  I wonder how "undiscovered" much of this truly was and how much was simply hidden with a purpose?  Not drawing any conclusions at this point but will be interested to see a complete breakdown of where this money was all along.  Another interesting study would be to see how grant funding coming into this city has actually be allocated.  There were several claims over the years by folks that grant money for one use was spent on something it was not meant for.  There have been so many irregularities in city finance.

[thelakelander]

Looks like this cash is going to be spread around town....

More roads, sidewalks and drainage projects

By David Chapman, Staff Writer

When City Council member Matt Schellenberg took office almost four years ago, one of the first things he did was find out how much money was in his district account.
There was only about $7,600 for the Mandarin area, which had parks, sidewalks and drainage needs.

One stormwater project, he found, was designed and ready to go — only to sit on the shelf for the past three years because, he was told, there was no money.

But money was there for projects like Schellenberg's. It just wasn't readily apparent.

After 40-plus hours of a council committee reviewing the city's Capital Improvement Projects, there was a lot found. Projects in various states, pockets of funding in others across the city.

On Tuesday, council passed a bill that moved that project forward.

The result, Schellenberg said, was possible through a subcommittee's time-intensive review.

"We were able to achieve a lot," he said, shortly after a Wednesday news conference that shared results of the committee's efforts.

Those included reconciling $590 million of projects dating back as far as 15 years, identifying $50 million for future projects and at least $25 million that could be pushed forward for current projects.

In all, more than 1,200 projects stretching back to the Better Jacksonville Plan were closed. Some were completed, some were in various states. Others needed more money after funds were diverted to fill other needs.

Typos and misplaced decimal points were examples of the overall problem.

Full article: http://www.jaxdailyrecord.com/showstory.php?Story_id=545342

[Tacachale]

I had not heard that full equation.  So you are saying that there were mistakes totaling 500 million on both the plus and negative side of the ledger that ended up with 50 million on the plus side?  I appreciate the clarification.  One thing joggling around in the back of my mind is the previous times I and Councilwoman Johnson tried to have just this sort of audit done while Peyton was in office.  That was because I discovered inconsistencies in funding in the Childrens Commission where interestingly monies would be shuffled to certain other areas as needed at the request of Peyton and included some other department inequities. The same was true with the now defunct Faith Based office. Both seemed on occasion to function like secret piggy banks of staff and funding.  I wonder how "undiscovered" much of this truly was and how much was simply hidden with a purpose?  Not drawing any conclusions at this point but will be interested to see a complete breakdown of where this money was all along.  Another interesting study would be to see how grant funding coming into this city has actually be allocated.  There were several claims over the years by folks that grant money for one use was spent on something it was not meant for.  There have been so many irregularities in city finance.

Right. There were $500 million in errors, not necessarily in found money that hadn't been accounted for. Most of it wasn't from improper spending, it was from projects that were basing budgets on reports that showed mistaken amounts of available money. In total, $50 million of unspent money was found, plus another $25 million that can be used this year.

[Non-RedNeck Westsider]

Just would like to point out a few facts to some of you who are so blindly one-sided to anything politikal and love nothing more than assigning blame.

Fact - There was a $12M accounting error found earlier this year.
Fact - There was another $500M accounting error found with $50M recoverable, also on Brown's watch.
Fact - the accounting errors can be traced back through at least 2 other mayors.
Fact - The committee that found the errors also did so under Brown's watch.
Fact - The errors found, thus far, have all been (total) on the debit side of the ledger.
Fact - There is still lots to do.

I have no dog in this fight (Brown v/s Curry), so when judged as a whole it's just as easy to blame Brown for not uncovering this mess himself as it is to give him the credit for his assistance to (by staying out of the way of) Boyer and her group to uncover the mess.

[Cheshire Cat]

Just would like to point out a few facts to some of you who are so blindly one-sided to anything politikal and love nothing more than assigning blame.

Fact - There was a $12M accounting error found earlier this year.
Fact - There was another $500M accounting error found with $50M recoverable, also on Brown's watch.
Fact - the accounting errors can be traced back through at least 2 other mayors.
Fact - The committee that found the errors also did so under Brown's watch.
Fact - The errors found, thus far, have all been (total) on the debit side of the ledger.
Fact - There is still lots to do.

I have no dog in this fight (Brown v/s Curry), so when judged as a whole it's just as easy to blame Brown for not uncovering this mess himself as it is to give him the credit for his assistance to (by staying out of the way of) Boyer and her group to uncover the mess.

Yup.  This is a problem in city finances for years.  Now that it has been exposed lets all hope we see much better management of our finances and deals. 

[Cheshire Cat]

Looks like this cash is going to be spread around town....

More roads, sidewalks and drainage projects

By David Chapman, Staff Writer

When City Council member Matt Schellenberg took office almost four years ago, one of the first things he did was find out how much money was in his district account.
There was only about $7,600 for the Mandarin area, which had parks, sidewalks and drainage needs.

One stormwater project, he found, was designed and ready to go — only to sit on the shelf for the past three years because, he was told, there was no money.

But money was there for projects like Schellenberg's. It just wasn't readily apparent.

After 40-plus hours of a council committee reviewing the city's Capital Improvement Projects, there was a lot found. Projects in various states, pockets of funding in others across the city.

On Tuesday, council passed a bill that moved that project forward.

The result, Schellenberg said, was possible through a subcommittee's time-intensive review.

"We were able to achieve a lot," he said, shortly after a Wednesday news conference that shared results of the committee's efforts.

Those included reconciling $590 million of projects dating back as far as 15 years, identifying $50 million for future projects and at least $25 million that could be pushed forward for current projects.

In all, more than 1,200 projects stretching back to the Better Jacksonville Plan were closed. Some were completed, some were in various states. Others needed more money after funds were diverted to fill other needs.

Typos and misplaced decimal points were examples of the overall problem.

Full article: http://www.jaxdailyrecord.com/showstory.php?Story_id=545342

I hope so.  There is so much needed through out the city that these finances can be allotted to.  People need to pay attention now and make sure the money us used properly.  Notice the mention of storm water.   Did you all know that money from the fees imposed under Peyton for storm water improvements has been tapped for other uses.  It has and we all need to ask how that happened.

[ben america]

We're talking about axcounting back to 1999. That has to be $12 billion plus in dollars. Pretty sure we've all been shocked to bounce a check or discover a couple of extra bucks here and there. A lot of this has to do with project accounting. So, it isn't a surprise. At least we're on the positive side.

[mtraininjax]

I have no dog in this fight (Brown v/s Curry), so when judged as a whole it's just as easy to blame Brown for not uncovering this mess himself as it is to give him the credit for his assistance to (by staying out of the way of) Boyer and her group to uncover the mess.

Staying out of the way of the City Council is what Brown does best. He has done so for the last 4 years, showing no leadership on the issues that affect Jacksonville, but he is always available for a photo-op for the stadium or a new Olive Garden at Regency. He has shown no leadership to look for City funds, other than to borrow money from JEA and Wall Street for projects, creating more debt for generations to find a way to pay for. If other issues happened in other administrations, that is old news. The last 4 years have been....more of the same. Time to change that!

What has been the lasting impression of Brown over the past 4 years? He has some nice political contributions from Shad Khan and Tony Sleiman, who both hope to steal land and deals from the Citizens of Jacksonville. He then also has 4 years of failed budgets. He has no passage of equal rights, he has no raising of the minimum wage, these are the facts. Basic city services have been cut, he is at odds with the JSO, he has a runaway demolition crew in Springfield, destroying history........he has no control of anything...morale in the toilet at the City....

Four more years of no lasting impression? Nope, I'm ready for change. The City Council is in charge now and will be with 4 more years of Brown, but we need a strong mayor, a leader of the city. More of the same last 4 years awaits you with Brown, he is the definition of blase (having or showing a lack of excitement or interest in something especially because it is very familiar)

[mbwright]

It's always the same story, but slightly different players.  It's hard to expect change from the status quo.  Just look at most any elected group.  We want things to be done differently in the future, but this rarely happens.

[Gunnar]

I had not heard that full equation.  So you are saying that there were mistakes totaling 500 million on both the plus and negative side of the ledger that ended up with 50 million on the plus side?  I appreciate the clarification.  One thing joggling around in the back of my mind is the previous times I and Councilwoman Johnson tried to have just this sort of audit done while Peyton was in office.  That was because I discovered inconsistencies in funding in the Childrens Commission where interestingly monies would be shuffled to certain other areas as needed at the request of Peyton and included some other department inequities. The same was true with the now defunct Faith Based office. Both seemed on occasion to function like secret piggy banks of staff and funding.  I wonder how "undiscovered" much of this truly was and how much was simply hidden with a purpose?  Not drawing any conclusions at this point but will be interested to see a complete breakdown of where this money was all along.  Another interesting study would be to see how grant funding coming into this city has actually be allocated.  There were several claims over the years by folks that grant money for one use was spent on something it was not meant for.  There have been so many irregularities in city finance.

Right. There were $500 million in errors, not necessarily in found money that hadn't been accounted for. Most of it wasn't from improper spending, it was from projects that were basing budgets on reports that showed mistaken amounts of available money. In total, $50 million of unspent money was found, plus another $25 million that can be used this year.

What still puzzles me is how that could have been overlooked. While I do understand that it is easy for funds to get lost (accounting-wise) in different sub ledgers (sometimes due to value dates etc.), where it should not be lost is when it comes to the actual cash accounting. I assume these funds sit in bank accounts and are not hidden in the stock drawer ? That's the minimum level of control there should be.

[Gunnar]

It's always the same story, but slightly different players.  It's hard to expect change from the status quo.  Just look at most any elected group.  We want things to be done differently in the future, but this rarely happens.

Problem with politicians - no matter where you go - is that they get to spend other people's money. There may be the few rare cases where politicians will treat the funds entrusted to them as if they were their own (ideally not literally), but by far and large they get to play Lego with the public's money.