Northampton County Controller Tara Zrinski formally presented her audit of Gracedale's retention bonuses to County Council yesterday. I previously posted her report (you can see it here), in which she determined that less than half of $5 million that Council authorized for employee retention bonuses was actually spent for that purpose. Council had requested the audit in March.
The $5 million in retention bonuses at Gracedale was part of a larger $15.5 million spending plan of federal pandemic funds at the nursing home, passed in 2022 by County Council. The only Council member to vote against bonuses was John Brown.
The audit makes no recommendations. Council member Ron Heckman asked if the Controller had any recommendation that future contributions like this be placed in a restricted account so that the funds can be tracked as spent. Zrinski and Lead Auditor Stacy Duke both stated that a controller makes no recommendations when it does an "agreed upon procedures" audit. It just presents its findings.
Council member John Goffredo, who like Heckman was participating by phone, was "very dissatisfied" because the audit fails to state specifically how these funds were spent after they were commingled with other funds. No matter how hard Zrinski and Duke tried to tell him that is impossible once funds are commingled, he kept insisting that the Controller could answer that question "with a little more work." Eventually, he was stopped by Finance Committee Chair John Brown, who said "we are going around in circles."
Stacy Duke later explained that the Gracedale general fund was exhausted the year in which the retention bonuses were poured into it, so all the funds were necessarily spent on Gracedale expenses. Gracedale was contacted to see if there were any tracking, spreadsheets, balance sheets or excel reports that would show expenditures being paid from money set aside for bonuses. There were none. "There was no tracking system. I'm not really sure how you can get a tracking system out of somebody who did not track it."
In response to questions from Council Prez Lori Vargo Heffner, Duke stated that the $5 million in retention bonuses was reported to the federal government as a "revenue loss." She indicated that Gracedale had $88 million revenue in 2023 but operating expenses of $116 million. So the $5 million was used for a "revenue loss."
Council member John Brown noted that retention bonuses were still being paid after 2023, even though the federal funds had already been exhausted. This means that the county would have been spending its own money for a portion of the $2.3 million paid out in retention bonuses. Duke agreed with his observation. He would like to know what county monies were moved over to Gracedale, but he acknowledged he would need to seek a new audit to get an answer. Given that county funds were used to pay retention bonuses after 2023, Brown questioned why they are not being used to pay career service employees now. He also wanted to know why Jennifer Stewart King, who was administrator for more than seven years, was never interviewed. "our audit staff does not have the power to compel somebody to give a statement," said Zrinski, who was battling a cold, allergies or both.
Brown concluded that the audit report was "misleading." He also expressed concern that the county moved money over to Gracedale in 2024 to cover a $8 million shortfall without a budget amendment or seeking Council's approval. "Someone's moving money without the authorization of this [Council]. ... This, along with the way monies are moved without being brought before this body is troublesome. They [the county administration] ignored or didn't honor the [council] resolution ... . There's a pattern of disregard for the checks and balances that are meant to be put in place."
Based on the points raised by Brown, there are still questions that need to be answered.
39 comments:
Like I've commented on other aspects of government, "Something is rotten in Denmark!"
Duh......It only took Council eight years to see the Administration doesn't care about the rules and they do as they please. There are numerous violations but this Council doesn't have the knowledge and the abilities to do anything about it. Even Brown violated the rules when he was County Executive.
Council controls the purse strings and they make the laws. What's rotten in Denmark is they don't know how to LEGISLATE. They pay an "outside auditor" to audit the "County Funds" why don't they have him find the money?
This was a terrible presentation. It answered nothing that wasn't already known. Zirinski's kindergarten bucket 'show and tell' would be insulting to any self-respecting legislator. She did the McClure/Barron confuse and obfuscate except she is terrible at it. The questions were fair the answers were childish in their defense of the indefensible.
She is confused and protecting poor financial practices, rather than call it out. In fairness to McClure, when you spend ten thousand on your successor you expect no less. This is a disaster, a complete disregard for a council resolution. Giovanni should clean the clock with her. She is not qualified to be Controller and once again shows she is completely incompetent to be county executive, other than to keep the McClure gang in jobs. The taxpayers lose.
Even with your endorsement and propping her up. It's a very sad story.
There were several monthly meetings last year where Gracedale was never reported on and council never questioned why. They didn’t ask questions of Gracedale during the budget hearing either. They blame the administration for not having transparency yet they could have demanded updates regarding Gracedale but never did. They keep preaching “council has oversight over Gracedale” but they ignored their duty long enough last year and now chose to pounce like tigers. They also should be held accountable for some of this.
I get they are a bit passionate about the issue but the way Gofredo, Brown and Lori spoke to Tara and the female auditor was a bit uncalled for. Almost attacking them especially the female auditor was very inappropriate and unprofessional. I felt so sorry for that auditor. They did their job and you berate them for it. Just because you’re council members doesn’t mean you can sit up there and belittle and attack people. No wonder people don’t feel comfortable speaking in front of council.
And there’s Giovanni who’s running for county executive who again says nothing on the matter and sits there and stays quiet. I guess that’s how he plans on running his campaign and possible future office - will let others speak for him and we see how inappropriately that is being done.
Worst County Council in history. Next year will either be very much better, or much, much worse.
Auditors just audit. They weren't the ones who made decisions about how the money was spent. Someone from Administration, Fiscal Affairs or Grace dale should have been on hand to answer questions.
John Goffredo and John Brown repeatedly yelling at the Controller and head auditor about choices they had no part in making came off as abusive.
Council ordered an audit and an audit was completed. Now, with that information, they can conduct an investigation.
I agree with everything you stated here
As a Northampton County resident, I am concerned about a lack of financial accountability and obfuscation that surrounds it before and after. I am also not surprised. This is where we are as a nation.
My County is a microcosm of our dysfunctional State and Federal governments. Our politicians and their agents no longer respect our tax dollars as the exclusive property of those who pay those dollars.
By now, we’ve all heard the terms ‘Waste, Fraud, and Abuse.’ So, how to avoid some of this? Throw the bums out, and bring in new players. Do this regularly.
Neither political party should get a pass. My policy is two terms, or five years in a unelected position and you’ve reached your ‘Sell By Date.’
Two facts: 1) McClure screwed the pooch on this. 2) Council is totally lost in space.
Who authorized the money to be moved ? Name the names! Did council approve this lumping of funding? Did the executive, controller, or council Authorize the move or not? Why was an audit requested by council , not finished on date requested?
From the original article:
He also wanted to know why Jennifer Stewart King, who was administrator for more than seven years, was never interviewed. "our audit staff does not have the power to compel somebody to give a statement,"
This is an interesting sentence.
Brown asks why Stewart King was never interviewed.
Zrinski replies that they cannot compel someone to make a statement, which implies she (Stewart King) was asked to be interviewed and give a statement but declined.
But if that’s the case, that should have been mentioned in the audit report and communicated to Council. Or did Zrinski never contact Stewart King? If so, was that just incompetence on Zrinski’s part, or was she/is she actively part of a cover-up to prevent council (and the public) from getting answers?
Who else was asked about the matter but refused to give answers (both in general or to specific questions)? McClure? Employees in the finance office? Someone else?
Who was actually interviewed and/or asked to give answers about the matter (where did the answers that council got from the controller come from)? Getting an answer to that question might be an indication of how hard the controller’s office was actually trying to get answers.
If Stewart King was actually asked and chose to decline, council should have been informed of this. If that’s indeed the case, that’s also a red flag and it’s also fair for council to ask the Controller what additional measures the Controller took because Stewart King declined to be interviewed (if in fact she did).
Does council have subpoena power? If so, they should use it to get a statement from Stewart King (if she was already asked by the controller’s office and declined). If council doesn’t have subpoena power, they should refer the matter to someone who does.
This really doesn’t make sense. The county receives funds all the time that can only be spent for certain purposes and have to be tracked separately. Doing so should be VERY easy and routine for the county to do.
I’m sorry, but chalking the missing funds off to “revenue loss” doesn’t cut it for me. We already know the money wasn’t spent (or tracked) properly. For all we know, those funds (and others like this) could have been pocketed and other “commingled” funds could have been used (or are being used) to cover it up.
A competent controller would already be all over this. A competent executive and council would already be demanding further investigation with real answers.
As it is, council may have stumbled on to something much larger than they were asking for. All parties owe it to the taxpayers to get real answers.
"Gracedale was contacted to see if there were any tracking, spreadsheets, balance sheets or excel reports that would show expenditures being paid from money set aside for bonuses. There were none."
So was the money in question just a big briefcase full of cash doled out at will? Cash is not traceable but nearly every other transaction is. Something doesn't make sense.
The fun part will be seeing how Lament and Tzara will spin this to aid their respective campaigns. We may see a brilliant, euphemistic spin on "I dunno not my fault don't blame me." Better duck, because the deflections will be quick and sharp.
I'm setting the odds are worse. Councils, boards, congress, et al, seem to be devolving as the electorate shows the world the effects of an education system emphasizing feelings, entitlement, deflection of responsibility, rewarding the miscreants and the dull, instead of critical reasoning, thinking, mathematics, science, and literacy. That latter stuff is hard and some don't get it, so we better water everything down in the name equity, equality, or whatever "equ-" word makes us feel good.
Zrinski's presentation & defense highlight her utter incompetence. If I were McCluless, I'd want my $10K back.
Something is rotten in the County of Northampton
If you wonder how Trump/Musk/DOGE become popular, look no further than this appalling lack of accountability.
Typical for the commissioners to ask a specific question, get the answer and cry about not getting answers for questions they did not ask. They should use their subpoena power and put the administration under oath to get the answers they want, instead of putting the blame on others for not getting the answers to questions they didn’t think to ask. If they are serious about oversight and not just being political hacks.
Ron Heckman is on the right track. This should have been a separate fund and dedicated account but it’s a little late for that.
It was abundantly clear last night, that Steve Barron is responsible for all of this. He didn’t even bother to show up.
Steve Barron will be at council tonight and they can question him. He was absent last night bc it was his wife's birthday and he so informed council.
Let me get this straight. Goffredo, Brown and LVH are slammed for their unprofessional manner of asking questions, and Giovanni is slammed for not asking questions. Alrighty then.
Goffredo was just not getting it last night and even Brown had to stop him. LVH was trying to use the audit to imply that the county violated federal reporting rules. Brown made some decent points. Since county funds were used to pay bonuses to union after the federal funds were exhausted, why can't county funds be used to pay career service? That is not a question auditors can answer, but the exec can. I do disagree with his assessment that the audit was "misleading." Council got exactly what they wanted, and it certainly does not put the county admin in a favorable light.
You seem to think that the auditors were charged with determining who made the decisions at Gracedale to place the money in an unrestricted account. This is an audit, not a personnel investigation. The persons responsible are known to the county and the exec told council two weeks ago he would share that with them in an exec session. Personnel matters are private. This was a good audit, and no, the $ could not have been pocketed. That is ab absurd speculation. It was in the general fund and was spent for Gracedale expenses.
I have endorsed no one in the Exec race and it would not prop anyone up. I like both of the Exec candidates and think both are certainly capable.
Heckman stated the obvious - the money should have been placed in a restricted account so it could be tracked. McClure acknowledged this two weeks ago.
Goffredo was intent on insisting you can track money after it is commingled but you simply can't. No matter how often Stacy Duke tried to explain it, he didn't get it.
Brown called the report misleading but his questions and the answers reveal that the audit gave him precisely what he wanted. He had the county's lead auditor agreeing with him that there was a deficit at Gracedale in 2023, that the federal funds for bonuses were used to pay other expenses in 2023 and that the county still continued to pay bonuses after that date with county funds. The audit reveals that the exec failed to follow council's resolution, at least with respect to career service.
It was a good audit and may very well lead to another.
I suspect Giovanni was satisfied with the audit.
Tara should just step aside for the executive seat. This is not looking good. Come up with some excuse why you have to go and try to save some what of your dignity and what's left of your professionalism
I couldn't agree with you more Vladimir- just look at the quality of our Candidates, and as far as our Education System, we spend the most per student in the entire World, yet rank near the bottom on results. We need to start teaching the 3 R's instead of trying not to hurt someone's feelings.
It is clear that what the county council and the taxpayers have been told for several years by the executive (and the administration) is not true. Gracedale wasn’t doing well financially, it was in a deficit, the daycare was never going to be a good idea (or open timely), etc. etc. It’ll be interesting to hear Steve’s take on this. Only in Northampton County under Lamont McClure can and has this occurred. Tonight’s meeting should be interesting. Good job Mr. Goffredo, Ms. Vargo Heffner and Mr. Brown.
The Controller was a member of County Council when this occurred and said councilmember lists one of her campaign contributors when she ran for controller as the current county executive. If the questioning seems *sniff* abusive *sniff*, I say crank it up a notch or two.
Why just Barron? Shouldn’t all involved be taking responsibility for lack of transparency to budgeted dollars? Who made decisions to move money within budgeted lines?
did you listen to the budget hearings? or any council meetings?
Will Gracedale be reimbursing the general fund then?
One thing that seems to not have been addressed in all of this—what about the employees who should have received the bonuses and didn’t? Are they going to at least correct that?
Mr. Brown? same clown that was the worst executive in history of home rule?
I would highly doubt that gracedale employee moved the money without the county personnel responsible for budget knowledge.
McClure is still winning and you’re still losers.
Sergeant Sam Elias for Council, he'll arrest them all.
Great job all. Lehigh, Berks, Bucks keep their county nursing homes out of the news. In Norco any press is good press.
Who is the current spokesperson for Gracedale?
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