Fort Myers Beach Council Grapples with Financial Oversight

The Fort Myers Beach Town Council meeting was predominantly centered on financial oversight, addressing concerns regarding the management of funds post-hurricane and potential adjustments to ensure better control in the future. The council focused on financial statements, a significant settlement with a contractor, the need for improved contract oversight, and the possibility of a forensic audit to investigate past financial practices.

In a move reflecting the gravity of financial management, the council scrutinized a recent settlement with a contractor tasked with hurricane cleanup. The settlement, amounting to $225,000, was necessitated by issues with the contractor’s invoices and documentation, which included sales tax charges, supply and equipment costs, calculation errors, markups, and a lack of supporting documentation. As a result of these problems, the funds had to be drawn from the town’s general fund. The council acknowledged the necessity of the settlement to mitigate the risk of attorney’s fees and the need for revising future contracts to provide better terms for the town.

The council also explored the financial aftermath of the hurricane, which included a discussion on the town’s cash flow and financial statements. The Finance Director reported a tight cash flow situation, with emergency expenditures totaling $24.8 million and about $16 million in FEMA reimbursements and $9.5 million from insurance proceeds received. The growing accounts receivable balance, specifically related to stormwater fees, was highlighted, with $561,000 overdue. Potential remedies considered for these outstanding balances included the possibility of granting forgiveness in certain cases.

Additionally, the council members assessed the status of various funds, including the general fund, emergency fund, gas tax fund, beach access fund, and others, by examining the revenue, expenditures, and changes in net assets. They paid particular attention to the variance between actual figures and the budgeted amounts, especially concerning the impact of the hurricane on the town’s revenue streams. The financial statements prompted questions and requests for clarification from the council members.

The idea of a forensic audit was introduced amidst concerns about the financial controls of the previous administration. The council debated the merits and potential outcomes of such an audit, which would aim to uncover any mismanagement or lack of controls. Members discussed the benefits of focusing on best practices and improving internal controls versus the cost and scope of a forensic audit. The council planned to gather more advice and deliberate further before making any decisions on this matter.

The Finance Director also provided updates on the procurement of a new accounting system. The discussion extended to the upcoming audit field work for the fiscal year 2023, expected to begin in April, and the challenges in connecting emergency expenditures with FEMA reimbursable Public Works projects.

Furthermore, the council addressed the impact of the hurricane on the town’s operations, including the handling of unapplied payments potentially requiring refunds. Metrics of water purchase from Lee County before and after the hurricane were analyzed.

The council’s discussions on financial management extended to the consideration of cashing in low-interest rate certificates and seeking better investment returns. There was also talk of creating new positions, such as a grants and payroll coordinator, to enhance the town’s financial and administrative capabilities.

Note: This meeting summary was generated by AI, which can occasionally misspell names, misattribute actions, and state inaccuracies. This summary is intended to be a starting point and you should review the meeting record linked above before acting on anything you read. If we got something wrong, let us know. We’re working every day to improve our process in pursuit of universal local government transparency.
Dan Allers
City Council Officials:
Jim Atterholt, John R. King, Scott Safford, Karen Woodson

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