Audit: Riviera wasted $1.2 million on ex-workers' medical insurance, other costs

Palm Beach Post (FL)

RIVIERA BEACH -- The city's failure to track employee departures led to more than $1.2 million in questionable spending for health insurance, job training and other costs, an audit released by the Palm Beach County Office of Inspector General on Tuesday said.

The findings followed reports by The Palm Beach Post starting in July 2018 that found the city continued to pay for health insurance for dozens of former employees, some for years after they left, including a dead one.

The audit, which researched employee departures from October 2012 through September 2018, found the problem was bigger than initially believed.

It found the city overpaid for 545 former employees' medical, dental or life insurance. The overpayments came to just over $2 million, of which just under $800,000 was recouped from the insurer. Total overpayment, according to the audit: $1,244,000.

"The expenditures were unnecessary and unreasonable and wasted taxpayer dollars," the audit concluded.

The audit report noted that the city, which is under new management, cooperated in the audit and took corrective action.

There are new procedures for the city to keep tabs monthly on insurance payments, and for the insurer to also cross-check to make sure it's not billing the city for insurance for departed employees, the report said.

The issue came to light in September 2017, when Riviera Beach's city manager, Jonathan Evans, then on the job six months, brought his concerns to the city council, as they voted to renew employee coverage.

But Evans was fired later in that meeting in a surprise move by opponents on the board. The issue never resurfaced in public until a citizen activist brought it to light at a city council meeting June 25, 2018 and demanded an explanation.

Amid a series of scandals documented by The Palm Beach Post, four of the city's five council members were defeated in two subsequent elections.

The reconstituted board rehired Evans in 2019, and in his response to the audit last week, he agreed with the findings and documented the city's corrective actions.

The audit also found the city had failed to recoup tuition and training costs from employees who left the city's employ within 24 months of the city's having paid for them. As a result of the finding, the city agreed to seek reimbursement of $4,525.

The audit also said the city hadn't taken adequate steps to prevent at least five former employees from accessing city computer systems.

In a letter to Inspector General John Carey, Evans said procedures had been implemented to keep that from happening again.

Loose control over computer security has hurt the city before. Riviera Beach was hit by a ransomware attack in 2019 and paid $600,000 to regain access to its records.

tdoris@pbpost.com

Follow Tony Doris on Twitter @TonyDorisPBP

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