We have not seen a response to the latest "draft" audit yet, but Ragsdale had already hired an auditor to audit his own department and to audit the Knox County auditors.

According to this morning's Sentinel, Ragsdale's "auditor" is a retired FBI agent from Nashville, Walt Valentine.

According to the state's Web site, Valentine is licensed as a Private Investigator, and his company, Valentine Investigations Inc., is licensed as a private investigation company.

Seems it's more of a witch hunt than audit.

Wonder if Knox County issued an RFP or an RFQ to hire Valentine? -- s.

Like the guy in the movie said:
Knox County citzens are mad as hell & we're not going to take it anymore!!

This is a blistering audit report.
Ok,its a blistering "draft" audit.
My god,spending 5000 dollars on an auditer to audit
the audit.

I'm not happy about "black wednesday"
We voters will fix that on election day.

However,these outrageouse travel allowances & credit card expendatures.Must be fixed NOW!!
This County Commission must stop this wasteful spending of MY TAX DOLLARS.

I support passing the budget;tonight.
But this budget is in deep trouble.
Counting to 10 is going to be tough.

Some see trouble with going in debt for the Sherriff's
dept.pension.

Others dont like raiding the rainy day fund.

And,oh Lord,the stormwater problems could have a 500 million dollar solution & the EPA's knocking on the door.

Still Others are concerned with a court order on more jail cells.

I am apalled that quarterly audits of Knox County Gov't employees are not conducted. I wonder what other common business practices are overlooked in local government operations?
Is an accurate inventory of equipment/furnishings/automobiles maintained by the county?

Where are the checks and balances?

Info on Finch not verified. Am requesting comprehensive list. -- s.

Not only is the continuing Knox County "drama" apaulling...
but has everyone simply put out of their mind the recent Knox City Community Development fiasco? Don't get me wrong, spending my tax money as alleged by County staff is WRONG and needs to be investigated, but, what ever came of the investigation into Knox City Community Development??? I hear the staff member who triggered the investigation never got the response due per Civil Service rules and other staff just simply quit - how can I believe that an investigation into County behavior will be any different???
Seems to me when $$ is involved the Mayor(s)can get their way - persuad, buy, or bully. Time will tell yet again...
AND just WHERE is our PRESS??? Only looking to sell papers OR inform the public?????

I agree with Sandra that a private investigator isn't the right person to "audit" commission. OTOH, I think the KC audit contained some inflammatory language, went beyond the customary scope of work, and was mistakenly released to media as a "draft."

It isn't clear to me from the charter who has authority to raise salaries in the mayor's office, but that Ragsdale did so in this manner (travel allowances), whether or not he had the authority, appears deceitful. It also appears to violate the Charter (Section 3.06, Item C., which indicates that all budget appropriations must be utilized strictly in accordance with the budget finally approved, unless commission approves a subsequent line item transfer). OTOH, I can see at the N-S site that the county salaries in question really are lower than comparable salaries paid by the city. (No, the ends don't justify the means.)

Finally, the non-T&E credit card charges explained in Ragsdale's June 13 letter at the N-S website seemed to me to be appropriate. OTOH, the question remains of how/when the county began paying for so much local T&E, in apparent violation of its own policy. That it did begin causes me to wonder if the practice is prevalent outside the mayor's office, as well.

And like S. Harris, above, I gotta wonder, if problems are truly extensive, why none of this has come to light before. The charter also indicates that commission shall provide an *independent* audit, by a CPA, annually (Section 2.02, Item B). Surely that happens?!

That seemed like a very unprofessional "audit", imo. I really cannot image a true, professional auditor providing this report.

In the end counting to 10 was a piece of cake
I'm pleased with the outcome

First, my thanks to Randy for providing the links to the source documents; I take issue, however, with your analysis and several of the subsequent comments.

This was an internal audit prepared for a specific purpose at the request of County Commission; it should not be compared to or held to the same standards as a financial audit prepared by an independent accountant. Although I cannot find an organization chart, it would appear – and it is logical – that the internal auditor reports to County Commission not to the County Mayor.

In my opinion the fact that the report is marked “DRAFT” is a non-issue. It is doubtful that the auditor made the report public. It is more likely that County Commission or members of the Commission accepted the report and made it public. Eliminating the word “DRAFT” would not change the reported findings.

Attempting to put the situation in perspective, it appears that the travel allowances were put into effect last year to supplement the salaries of certain county executives. Reading between the lines, it appears that it came to the attention of the county auditor that these non-accountable travel allowances had not been reported on the respective W-2’s as required by the IRS. As the auditor states, one would expect the county executives who awarded themselves the allowances to be aware of and to comply with the IRS requirements. When he found otherwise, he reported that information to the County Commission. Obviously, there is also the question of the appropriateness of the allowances.

In short, it would appear that the county’s internal auditor was simply doing his job and is now being characterized by some as the villain.

As for County Commission’s discretionary funds, I would assume individual expenditures require subsequent appropriations.

The one good thing about being pessimistic is - at least it shows you understand the situation. -- Unknown

I didn't see the meeting. KNS reports (in it's very brief report online) that the budget was passed in it's entirety ($614M), but says Ragsdale difused the dispute by cutting the travel pay for Arms, Werner, Vandevate and Finch. Was it 'reclassified' and included in these employees salaries? Was it cut out entirely? If so, where did that money go? And, what happened to Ragsdale's $20,000 in 'travel money'?

FYI, Margie Lloyd is Ragsdale's executive assistant. A very capable and nice person. Don't know what the deal is with the cruise payment.

CBT

Ragsdale difused the dispute by cutting the travel pay for Arms, Werner, Vandevate and Finch. Was it 'reclassified' and included in these employees salaries? Was it cut out entirely? If so, where did that money go? And, what happened to Ragsdale's $20,000 in 'travel money'?

Ragsdale said his senior staff will use "his card" when necessary and will claim per diem for travel. I assume this means he's cutting up their county cards.

He said four years of credit card use have been reviewed and "individuals have been contacted and have written checks" to repay the county for personal expenses. This is a list we need to see.

He said he will "roll back" the salary supplements for Arms, Van de Vate, Werner and Finch although he is "very proud of the work that they do." He came close to admitting a mistake, saying giving them $12,000 per year as undocumented travel expense money instead of a raise "was not the right way to handle it."

Where did this money go? Ragsdale adopted Jack Huddleston's suggestion to give an additional $500 bonus to each county employee who earns less than $45,000.

So county employees (including the senior directors) will get a $500 bonus and a 2 percent pay increase and those earning $45,000 or less will get another $500.

Ironically, the bonuses are not coming out of a surplus. Instead, they are coming out of the county's rainy day fund. The Ragsdale budget (adopted unanimously) spends $102 million more than the county will take in. The difference will be borrowed or will come from the fund balance.

It's sort of like George Bush giving us a $300 tax cut while running a deficit. -- s.

I expected a group hug to break out at any minute...

I'm still courteous as to how some of the charges on the P-card statement is reconciled. Iwould think that each of these T&E charges has to be posted to a line item or the expense has to be suspensed so it can be passed on to off balance sheet funds (i.e. someone writing a check). The books have to balance somehow. All the focus of these expenses has been on the cash side... I'm sure a formal audit will reveal the other side of the transaction so maybe we'll get to see how these expenses are funded.

Debt service and storm water are really going to cause some restless nights for our next batch of public servants (and ultimately the county taxpayer)...

That cruise purchase stinks to high heaven. The county is not permitted to do that.

I don't give a crap whether a "draft" or a final report was released or leaked or squirted. that's a minor, inside-baseball issue, and both sides were playing gotcha.
What ticks me off is the arrogant waste of taxpayer dollars.
*We should not be buying John Werner three kinds of beer, or anyone else's alcoholic beverages beverages of choice.
*We should not be expected to believe the old canard -- "We could be making so much more in private industry..." -- because it just flat ain't true for those at the top, who are handsomely compensated while the worker bees barely eke out enough to survive.
*We should not be expected to believe the bullcrap explanation that our mayor and his charming staff's sharing $600 dinners at Mortons with whomever is what changed the BEP formula.
*We should not be sending seven county employees to LA to watch a hard-working principal pick up a $25,000 award.
*They should not be staying at the Beverly Hills Hotel on our nickel.
*We should not be paying for anybody's lunch in downtown Knoxville, and members of the media should not allow government employees to buy said lunches.
*County employees should not be getting free or firesale-rate parking in a garage we pay for but are not allowed to use (and yes, I know they've opened up a few spaces at night -- but that doesn't address the real issue).
*We should not accept the dates on these checks reimbursing the county for improper expenditures to have the dates redacted.
*And we shouldn't allow those who are deploring the bad PR and loss of civility to change the subject.

In regards to salaries, they knew what they were getting when they took the job. Trying to play fast and loose after the fact smacks of sour grapes to me.

Where to start? First, I will agree with Tamara that it is not clear from the audit report whether the travel allowances were reported to the IRS or not. The reported comments of John Werner and Dwight Van de Vate, however, lead me to believe the allowances were not treated as additional compensation.

I can’t speak for the county internal auditor; however, if I were in his position, I would not want to be in the position of issuing the current report and I certainly would not want to be accused of being unprofessional for doing so. What tests should he have reported, Tamara? In the review of the payroll records he noted unexplained miscellaneous payments to certain top-level employees for which he apparently could find no support, period. That’s an awkward position to be in for any auditor and particularly for an internal auditor whose job requires that he work with the finance department on a continuing basis. The bottom line is that there should not have been unauthorized salary supplements termed travel allowances.

As for lacking professional courtesy, if professional courtesy should have been extended, it would appear to be on the part of the County Commission Audit Committee, not the auditor. Walls specifically restricted the use of his report. It’s somewhat naïve to believe that Ragsdale and Company were not aware of the findings prior to the report being issued.

The one good thing about being pessimistic is - at least it shows you understand the situation. -- Unknown

By the way, Tamara, Dwight doesn't have a melanoma. He has non-Hodgkins lymphoma.