LENOIR CITY — An independent review of the Lenoir City Housing
Authority has revealed numerous deficiencies.
The report, conducted by Brown Jake & McDaniel PC, and presented
to City Council members on Monday night, found problems with
contracts, inventory, charge accounts and more than two dozen
issues related to travel expenses.
City Attorney Jim Scott told council the audit raised
“significant concerns” both for the type and number of
deficiencies discovered. He recommended that the Housing
Authority’s board of directors continue to investigate and
suggested the matter should be turned over to the Tennessee
Bureau of Investigation.
Mayor Tony Aikens also suggested that the board contact legal
counsel to deal with the issues raised in the audit. Aikens said
he has been concerned about the administration of the authority
for many years since he learned that several board members may
have been appointed illegally by his predecessor.
“The audit proves there was mismanagement. I hope the new board
will take swift and appropriate action,” Aikens said.
Frank Hahn, who along with two other new board members was
appointed to the housing board last year by Aikens, pushed for
the audit during a meeting in March. He said it is always a good
idea to perform an audit when there is a change on the board. He
said he plans to pursue the investigation further after meeting
with other board members.
Housing Authority Executive Director Debbie Cook said she was
not impressed with the audit’s findings. The authority is
regularly audited by HUD and no problems have been found in the
past.
The report found that many office items were not serial numbered
or recorded. Checks were not regularly deposited into the bank.
Some items were purchased by credit card without proper
invoicing, according to the report.
The audit also highlighted excessive spending. The report found
that an office door was upgraded from an original cost of $850
to $3,400 and the remodeling of the executive director’s office
cost $12,286. More than $20,000 was used to add a parking lot
and $36,000 was used to build a covered walkway to the lot, the
report said.
Cook said that the door to her office had to be replaced with a
high security door. The total cost to remodel her office, she
said, was less than the $15,000 budgeted by the board for the
work.
Most of the deficiencies were focused on travel and
reimbursement policies where the auditors found numerous
instances of employees receiving per diem supplements for meals
when meals were included with the cost of the conference.
Cook said she has always followed General Services
Administration guidelines for travel reimbursement. The
authority also has its own travel policies, which are closely
followed, she said.