In wake of a scathing audit, the Nebraska Brand Committee has come under fire.
A state audit discloses sloppy bookkeeping, personal use of a state-owned vehicle, releasing a check for livestock before paperwork had cleared, among other problems.
State Sen. Al Davis of Hyannis holds Brand Committee Executive Director Shawn Harvey responsible.
“Problems that surfaced there that were under his purview were serious enough that he should probably be terminated,” Davis tells Nebraska Radio Network. “Should be terminated, not probably.”
Harvey did resign. It seems.
In wake of the audit, the Brand Committee asked and received Harvey’s resignation during its meeting in North Platte on the 8th. The committee then created the position Chief Investigator and Director of Field Operations. It appointed Harvey at the same salary he earned as director, $107,000.
Davis calls it, “…one of the most convoluted and incomprehensible decisions they could possibly have made…” Davis says it appears the committee took the action to save face, but didn’t take the violations exposed by the audit seriously.
Davis says the Unicameral might get involved.
“I know there are a lot of people in state government and in the legislature who aren’t happy with the audit,” according to Davis. “So, I’m fairly certain that there will be some action that comes next year, unless the Brand Committee comes to their senses.”
Davis questions the impact of the committee’s action on the morale of the 100 employees the committee has.
Gov. Pete Ricketts says the independence of the volunteer-run agency is at stake.
“So, there’s no way for them to provide the level of oversight that I can provide to one of my agencies,” Ricketts tells reporters. “And so it is going to be really incumbent upon them to continue to provide a heightened sense of oversight on how those operations are being run.”
A list of the state audit findings:
1. State Vehicle Usage: The Executive Director utilized a State-owned vehicle for personal use. Also, other inspectors were allowed to use their State-owned vehicles for non-work activities.
2. Proof of Ownership: The Executive Director ordered release of proceeds from the sale of livestock even though the proof of ownership had not yet been provided, as required by State statute.
3. Backdated Form: The Executive Director allegedly backdated the approval of an employee disciplinary form on file prior to giving the form to the APA.
4. Personal Vehicle Mileage: The reimbursement for personal mileage to inspectors was significant, with no cost analysis being considered. Also, three of the five Committee-owned vehicles were underutilized.
5. Receipt Procedures: The Committee lacked adequate policies and procedures for determining the amount of inspection fees and other certificate costs that should be collected. This resulted in uncashed/lost checks, significant receipt lag time from when inspections were completed, and increased risk of loss of the Committee’s funds.
6. Estray Fund: Certain issues were identified within the Committee’s estray fund procedures, including checks being lost, cases not being properly turned over to the Alliance office timely, and money not being remitted to the Permanent School fund, as required by State statute.
7. Untimely Deposits: It was noted that 8 of 35 receipts tested were not deposited timely, as required by State statute. Also, five other receipts could not be tested for timeliness, as the date received was not documented.
8. Ammunition Purchase: The Committee purchased ammunition for a firearm not owned by the agency. The agency allows inspectors to carry personal firearms if they are certified.
9. Cleaning Contract: The Committee was paying on an expired contract entered into with a Committee employee.
10. NADC Filings: Two Committee Board members did not file the Statement of Financial Interest form with the Nebraska Accountability and Disclosure Commission (NADC), as required by State statute.
11. Leave Balances: The Committee allowed accumulation of compensatory leave balances in excess of the maximum allowed amount. The APA also identified terminated employees with negative leave balances.
12. Intermittent Brand Inspector Benefits: The Committee lacked procedures to monitor the status of the intermittent employees and their hours to determine if they should be receiving benefits.
13. Payroll Issues: The Brand Committee failed to follow payroll procedures outlined in its employee handbook on several instances.
14. Longevity Pay: The Committee is one of the few, if not the only, State agency that provides longevity pay to employees. As longevity is compounded and entered manually into the payroll system, errors were noted.
15. Travel Testing: There was no travel policy for employees who were not inspectors. The Committee’s review of inspectors’ mileage reimbursements were inadequate, resulting in expenses being paid without sufficient information provided. Because mileage was not recalculated, certain individuals were over reimbursed.
16. Outside Legal Counsel Not Approved: The Brand Committee maintained a legal counsel position without proper written approval from the Attorney General’s office.
17. Statutory Fees: The Committee charged a fee of $100 per application for brand leases and an inspection fee of $1 per head for horses. There is no statutory authority for these fees charged.
18. Fixed Assets: The Committee lacked procedures to ensure that its fixed assets were properly recorded and monitored within the State’s accounting system. This resulted in capitalization of a purchase that did not meet the capitalization requirements.
AUDIO: Brent Martin reports [:45]