Sterlington officials say they are awaiting the release of the state Legislative Auditor’s investigation into how the town’s finances may have been mishandled.
“The Legislative Auditor’s report should be coming soon,” said Mayor Caesar Velasquez on Tuesday. “They haven’t told us when, but they’ve told us it’s coming.”
The state Legislative Auditor’s initiated a comprehensive investigation of Sterlington in 2018 after an audit indicated “multiple possible compliance issues at the Town that may have occurred during the audit period.”
An audit report from October 2018 said federal and state laws may have been violated. Some of the issues noted in the audit included bid law violations, the lack of purchase orders, management’s possible override of controls, among other problems first reported by The Ouachita Citizen.
One of the aspects of the Legislative Auditor’s investigation was Sterlington’s agreement with Capstone Metering LLC and a roughly $2-million loan the town obtained through the deal, according to town officials.
Sterlington is operating under the direction of a fiscal administrator, I.M. “Junior” Shelton Jr. Shelton was not present Tuesday for the Sterlington Town Council’s regular meeting.
In September, Shelton informed state lawmakers that he had questioned Sterlington’s draws on the $2-million loan with Capstone. For example, Sterlington made four draws on the account, including one draw of $516,000 for installing 170 water meters, one draw of $516,000 for installing 70 water meters, and one draw of more than $600,000 for installing 40 water meters, according to Shelton.
Velasquez claimed Sterlington officials never made the draws or had access to the escrow account.
“There is a question about a lot of the money spent,” Velasquez said. “We still don’t have a definitive answer, because we could never get an invoice from Capstone that reflected every draw that was made. It’s still out there.
“We need to know what was paid for or where all the money went?”
Velasquez and Town Council member Ron Hill confirmed the Legislative Auditor was investigating the matter.
Once the Legislative Auditor’s investigative report is released, Sterlington will have a better idea about how to recoup the money or whether to urge the prosecution of any party responsible for wrongdoing, they said.
According to Velasquez, it was doubtful someone walked away with close to $2 million in their pocket
“But there are things out there that look shady,” he said.
During the Town Council’s meeting Tuesday, council members spent most of their two-hour meeting combing through budgets, records of expenditures and aged payables. A report of aging payables shows some $300,000 in aging payables, some older than 90 days.
The Town Council also learned that Sterlington’s sales tax collections for the year were a little more than $29,000 higher than the same time last year.
“We’re almost at $30,000, that’s compared to the total last year,” Howse said.
Velasquez commended the city of Monroe’s taxation and revenue department, led by Tim Lewis, for conducting audits of sales tax payments in Sterlington.
“I did talk to them, and they have been doing audits in Sterlington, and I think that gave us a little help to our uptick,” Velasquez said.
Meanwhile, Sterlington is still seeking ways to generate revenue to help pay back the pile of debt that mounted in recent years under former Mayor Vern Breland.
According to Velasquez, he cut the town’s spending by about $531,000 after he was sworn in as mayor. No major cuts have been made since Shelton stepped in as the town’s fiscal administrator, according to Velasquez.
“What we’ve done with the fiscal administrator has done is tried to offset payments or pay down some debts in smaller payments rather than in one lump sum,” Velasquez said. “Mr. Shelton and I have been working very hard to build up our credibility, which is something that hasn’t been so great.”