Brown Proposes NorCo Fiscal Overhaul

Lamont McClure has lots of questions

Northampton County Executive John Brown has proposed a sweeping overhaul of the County's Fiscal Affairs Department. It's a plan that calls for county accountants to be responsible to other accountants instead of department heads. Acting Fiscal Affairs Director Doran J. Hamann, who has been employed at Northampton County for 35 years, likes what he sees, believing it will go a long way towards resolving "material weaknesses" identified in the County's last two independent audits. Brown told Council's Personnel Committee yesterday that, at the end of the day, it should save taxpayers money.

What makes this plan controversial to some is that it calls for a major promotion of an accountant whose mother happens to be Council President Peg Ferraro. This accountant, Mary Alice Einfalt, is a CPA who in four years has taken over responsibility for General Purpose Financial Statements (GPFS) and the Comprehensive Annual Financial Report (CAFR). She's transformed Payroll, initiating paperless pay, eliminating OT there by 97%, and has taken some Human Resources tracking from there to Payroll. She has identified and eliminated internal control weaknesses missed by the outside auditor and Controller. One glaring example of this is eliminating a practice in which the accounts payable department was permitted to create new vendors. She is a cross-training advocate and also a disciple of Continuous Improvement (CI), which ironically was championed by John Brown's opponent, John Callahan. In an interview, she stated she wants accountants reporting to what she calls "other bean counters", not department heads.

But she's Peg Ferraro's daughter, a point that Council member Hayden Phillips mentioned at the Personnel Committee. But after speaking to her, his concerns about nepotism vanished. "I'm very enthused about Mary Alice having this position to the extent that it overcame my concern of even a hint of nepotism," he said. "I really want to make sure that this is purer than Caesar's wife," he added.

Phillips is the only Council member who squarely addressed the nepotism question, which was avoided by other Council members.

"I have to tell you, I'm a fan," said Phillips of Brown's proposal. "I think this is really what the County needs.

Council President Peg Ferarro took no part in the discussion concerning her daughter. Under the County's nepotism policy, put in place in 2007, will be unable to vote for her daughter's promotion

It's a big one. Her salary as Accounting Manager will skyrocket from $66,504 to $87,307.

At the same time, Gracedale's Fiscal Administrator will have his responsibilities reduced. His salary will also be reduced, but only slightly, from $95,341 to $95.005. He will report directly to Einfalt instead of to Gracedale Administrator Dee Herman.

This fiscal overhaul also calls for a new position, Human Services Fiscal Administrator, with a salary ranging between $73,064 and $103,955. Accountants in different human services departments will report to the Fiscal Administrator instead of department heads, giving the County a better idea whether an individual department is going over budget.

Hamann reminded Council that outside audits have identified "material weaknesses" in the internal controls of Human Services departments. "That's not something you want your external auditors to find about your organization," he observed. "In my terms, a 'material weakness' is something that needs to be addressed immediately, if not sooner." Health Choices, Gracedale, Drug and Alcohol and Children and Youth have been identified as problem areas. He completely supports giving the Fiscal Department greater financial oversight in those departments. "We can constantly, on a day-to-day basis, be involved in what's happening, rather than being involved at the 11th hour," he explained.

Controller Steve Barron, however, had reservations. He said the County's Fiscal Policies and Procedures, last updated in 1988, should be addressed first. On three separate occasions in his monologue, he told Council that Brown was "putting the cart in front of the horse." This expression was later picked up by Council member Lamont McClure, who repeated that phrase twice. Ken Kraft repeated it once.

Kraft suggested that the proposal be reviewed by the Finance Committee first, to determine if it has an impact on the Budget. Brown stated the total impact would be under $50,000, and could save much more money.

McClure suggested he might go along with the overhaul if the Executive committed to shedding Premiere, Gracedale's privatized Administrator. Without answering, Brown noted that many of Premiere's recommendations still need to be implemented by Council, including a pool of per diem workers. He added that, since being sworn into office in January, he has paid close attention to Premiere and Gracedale, "There hasn't been a hard line for the Gracedale account into Fiscal," he explained, referring to a need for greater oversight.

McClure also suggested this reorganization would be unnecessary if Brown just appointed a Director of Fiscal Affairs. The Executive answered that he has yet to determine whether that role needs to be filled, but that the accountability problem would persist even if the position were filled.

Council is scheduled to vote on Brown's fiscal reorganization this evening.

The one accounting rule everyone needs to remember is the rule of five. Are there five votes? Kraft stated he likes the idea, and McClure may go along as well.