Chancellor Fire issues reported [The Free Lance-Star, Fredericksburg, Va.]

Nov. 23--Missing money. Lost paperwork. Lack of communication.

Two recent reviews of the Chancellor Volunteer Fire and Rescue department's finances have found several issues with oversight and accountability.

Neither review found criminal activity.

"But we found a lot of looseness in internal controls," said Nancy Miller of the auditing firm Miller Foley Group. She presented a review of Chancellor Volunteer Fire and Rescue to the Spotsylvania Board of Supervisors last night.

Spotsylvania County Administrator Doug Barnes asked Miller to review the Chancellor department after several issues arose with the volunteer rescue agency.

Chancellor is one of three volunteer organizations that respond to emergencies in Spotsylvania. The county gives Chancellor more than $500,000 each year. Some $195,000 of that is per diem money, which comes from the fees the county collects from insurance companies for ambulance rides.

Nearly two years ago, Chancellor's response to a fatal fire sparked an outcry of concern about how Spotsylvania handles emergency services. Three reviews of the response to that fire criticized the system, which allowed the three agencies to operate almost autonomously. Since the fire, the county has worked to corral all three agencies under its Fire Rescue and Emergency Management department.

Several issues came up throughout the process, and this spring, Barnes requested an audit of Chancellor's finances. At the time, the department was reeling from back-to-back arrests of volunteers on sexual charges. The county was reviewing the volunteer screening process, and Barnes also wanted to review the money.

"If we've got issues, let's find out what all of them are and deal with them," Barnes said.

That review found five issues with Chancellor: management, cash payments, the per diem account, ledgers and bingo.

Mostly, auditors found that Chancellor has few controls in place to make sure the finances run smoothly.

"And when they are there, compliance is erratic at best," Miller said.

Supervisors seemed particularly disturbed by the per diem issue. In the review, auditors found that Chancellor uses the per diem money to pay for a part-time employee.

But that use goes against the whole point of per diem money, said board chairman Benny Pitts.

"It was never intended to buy equipment, it was never intended to hire part-time employees," he said. "It was intended to be a retention tool to get people to run calls."

The per diem money was a sticking point at a recent meeting between the supervisors and the Fire and Emergency Medical Services Commission. Then, supervisors criticized Chancellor leadership for using the money to buy equipment instead of giving the money directly to members, as the county's other two volunteer organizations do.

Chancellor Rescue Captain Eric Lasky told supervisors at that time that the department used the money for training supplies and for equipment but not to pay members. So Barnes was surprised to learn the department uses the money to pay a salary.

According to the review, "It is unclear whether this is a permissible use of those funds."

That specific issue was not mentioned last night, and no one offered an opinion on whether it is OK to use per diem money to employ someone.

The review also mentioned an audit of Chancellor's bingo practices. The Virginia gaming commission produced a report in September that found that the organization had shoddy paperwork, a lack of oversight and missing money. That $250 was lost after a bingo game on July 31. According to the audit, Chancellor Treasurer Hollie Williams told auditors that "one of the volunteers was suspected of theft."

Bingo is a big part of Chancellor's finances, and in 2009 games netted $82,976, according to the department's 990 form.

Supervisors said that the reports show a need for more oversight of volunteer finances. The board charged county staff with creating a plan to address the issues in the audits.

Amy Flowers Umble: 540/735-1973

Email: [email protected]

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