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SSHA Corrective Plan

SSHA Corrective Plan

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Published by David Lombardo
The Saratoga Springs Housing Authority corrective action plan in response to an audit by the state's Comptroller
The Saratoga Springs Housing Authority corrective action plan in response to an audit by the state's Comptroller

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Published by: David Lombardo on Mar 21, 2013
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05/30/2014

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CORRECTIVE ACTION PLANMarch 21, 2013Our Response to Recommendations 1-7 will be given in the same order andso identified.1. Since all expenses were approved under the existing TRAVEL POLICY(attached as Exhibit A) which requires that such be authorized by theExecutive Director, recorded and signed by the traveler, Executive Director,Chairman or Vice-Chairman of the Board (in cases where one or more of these officers is also a traveler, the practice has been to have one of theother non-traveling officers sign off on it), there was no violation of thispolicy and no reason to ask any individuals to reimburse the Authority forany funds expended under it. All of our policies are subject to HUD reviewand approval.In response to the suggestion that we strengthen the travel policy,however, we have instituted a pre-approval form (application for funding)stating the purpose, dates and projected costs of travel, to be authorized byone of the listed Agency or Board Officers, or (supposing a case where allthose listed under the policy are involved) by another, non-traveling Boardmember. The same form then doubles as a post-travel approval form withthe appropriate Board Officer/administrator authorization. In our exitinterview the auditors mentioned that the absence of such a form was themain reason for designating that particular set of expenses as ‘questionable’.Now that we have adopted and already used the new form in response to thefirst recommendation, we presume the procedure is now satisfactory.Further analysis of the travel reimbursements, totaling $11,689,identified in the audit report as ‘questionable’ reveals that the payments fortravel of the Executive Director and Chairman of the Board during the periodexamined were all charged to, and paid out of, non-federal funds, i.e.,monies earned by the SSHA through its own activities. Only the expenses of Ms. Peterson ($1,818) were charged to federal funds. Her travel wasnecessary because as the individual at SSHA who runs the scholarshipprograms (Bollinger, Home Depot, and Freedom and Civil RightsScholarships), available to residents and their families, she was required byPHADA – which administers those funds – to attend a training sessionavailable at the same conference the E.D. and Board Chair were attending. The suggestion that we could have ‘saved’ that amount by not sending herfor the certification training would have meant that we would then have beenunable to participate in these scholarship programs and our residents denied
 
the opportunities afforded them for self-improvement through furthereducation.Past practice has been that those funded for travel report out at thenext Board meeting on the results of their travel and in some casesextensive written reports have also been submitted for circulation to theBoard. This practice will be continued. It has
never 
been the policy orpractice to reimburse anyone for travel or
 per diem
expenses for spouses,nor has any such payment ever been made. The
 per diem
rate for room andboard for purposes of reimbursement is set by the federal government andvaries by location.2. Bringing vendor invoices to the full Board for approval, as suggested bythe audit report, would result in delays in payment to vendors which, in turn,would count against us in the PHAS (Public Housing Assessment System)scores used by HUD to designate different Authorities as ‘troubled’,‘performing’, or ‘high performing’. As an Authority which has consistentlybeen rated as a ‘high performer’ for the past six years, this has enabled us toearn an additional share of 5% of each year’s Capital Fund allotment fromHUD for modernization of our facilities. This is a significant amount of moneyfor us as federal funding has steadily shrunk over the years, and we arereluctant to jeopardize our standing with HUD, which regards our record of timely payments to vendors as part of our commitment to being a positivecontributor to the local community.(The most recent notice of our PHAS scores, dated Nov. 7, 2012, is attachedas Exhibit B.)But in order to strengthen the oversight function of the Board asrecommended, we have since instituted a practice whereby the Vice-Chair of the Board reviews all invoices on a weekly basis, prior to payment, after theExecutive Director has reviewed them to certify receipt of goods or servicesdetailed in each invoice and initialed his approval and directed the CFO tocharge the appropriate budget. Any additional Board members who care to,may also share in this weekly review process at any time.Security has also been enhanced, as
 per 
the recommendation of theaudit team from OSC, by keeping the supply of blank checks and check-signing machine under lock and key in the office of the CFO and thenameplates in a separate location under lock and key in the Office of theExecutive Director so that neither can use them together without the other’sknowledge and consent.3. As noted in our original response to the draft audit report, this is a mootpoint since any connection with J&M Auto was discontinued by December,2011, well before the audit was begun.
 
4. We have since updated the position title of Cindy Gaugler to reflect therecommendation of the audit team that since she in fact serves as our Chief Financial Officer, this should be reflected in her job title. Her new title is‘Director of Finance’. We shall bring other title changes to the Board, wherenecessary, for approval this spring.5. The recommendation that in future negotiations we should “align theDirector’s salary with industry comparables and Federal requirements”appears to flow from the auditors’ assumption that the ‘suggestedguidelines’ floated by HUD in August, 2011, which involved ‘salary caps’ forExecutive Directors of different sized PHA’s would become permanent HUDpolicy. To date this has not happened, and the guidelines have provoked allmanner of controversy nationwide, including the threat of litigation by thenational organization of PHA professionals (PHADA). Thus far theseguidelines have not been implemented by HUD, nor even been publiclyreaffirmed.SSHA policy on Executive Director salary and compensation was set byan agreement between the Saratoga Springs City Council and the Board of Commissioners of the SSHA in 1981 – comparability with Saratoga SchoolDistrict Principals. Since no single principal was singled out in thatagreement (there are, today, seven principals), we assume that the idea atthe time was that our Executive Director would be compensated
somewherewithin the range of all the existing principal’s salaries.
If now we revert to
this
criterion of comparability, which has been our policy since 1981 andremains our policy to this day, we find that the latest figures available fromthe official New York State Website, <SeeThroughNY::Payroll-Schools>, for2012* are as follows:Caroline Street Elementary - $160,306Lake Avenue Elementary - $147,512Dorothy Nolan Elementary - $130,540Division Street Elementary - $122,882Greenfield Elementary - $97,926Saratoga Springs High School - $117,550*No figures are given for Geyser Road Elementary, whose principal is aninterim appointment while the search for a permanent appointment is beingconducted.By
this
criterion of comparability, the only criterion mentioned in ourpolicy and stated clearly in the Personnel Policies and Procedures Handbookof the SSHA, Mr Spychalski’s salary of $144,921 for 2012 is well within therange of the salaries listed above. (See Exhibit C)We agree to utilize professional consultants familiar with the publichousing industry, in addition to our own legal counsel, to advise us oncontract details in the future as
 per 
the audit recommendation. In terms o

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