County audit fails to clear up W. Va. volunteer fire dept. finance questions

With more questions than answers, county officials are seeking a deeper audit from the state

By Rusty Marks
The Charleston Gazette

CHESAPEAKE, W. Va. — Kanawha County Commissioner Dave Hardy says a county-ordered audit of the Chesapeake Volunteer Fire Department raises more questions than it answers.

"The auditors were very disappointed with the records that they were provided," Hardy said.

In December, members of the Kanawha County Commission asked for an audit of the fire department because of its bingo and raffle games. Hardy was also concerned about the relationship between the nonprofit fire department and a for-profit radio communications business owned by the fire department.

Employees with the communications business sell and service police and fire department radios.

The final audit report was finished last week, but Hardy said auditors found fire department officials uncooperative and reluctant to turn over records. The audit report contains a lengthy list of information Chesapeake fire officials did not provide.

"Look at all the stuff they would not give the auditors, despite repeated attempts [to get the information]," Hardy said. "This is six months."

Chesapeake Fire Chief P.J. Johnson could not be reached for comment Wednesday.

According to auditors, information not yet provided by the fire department includes:

  • A copy of the fire department's bylaws
  • A list of fire department members
  • Minutes from fire department board meetings from 2009, 2010 and 2011
  • Copies of lease agreements
  • Numerous records pertaining to the for-profit communications business
  • Federal tax records for the fire department and for-profit business

Steve Johnson, P.J. Johnson's father, is chairman of the fire department's board of directors and a fulltime employee of the for-profit radio business, according to auditors. But Steve Johnson refused to disclose his income for 2011, telling auditors that "what he earns is no one's business," according to auditors.

Auditors also had trouble determining exactly how much the fire department made running bingo and raffles as fundraising events, according to the report.

Auditors believe the fire department sold about $1.36 million in raffle tickets in 2009 and paid out close to $1.1 million in prizes, sold about $1.5 million in tickets in 2010 and paid out about $1.2 million, and sold about $1.2 million in tickets in 2011 while paying out about $940,000. But fire officials couldn't provide required W2 tax records for the winners of the money, according to the report.

"If you get a raffle prize, that's a taxable event," Hardy said. "There are no records of the prizewinners."

Hardy said he would ask the fire department to reimburse the county for the $16,000 cost of the audit. County officials also may start paying for equipment for Chesapeake directly rather than giving the department money.

Hardy said he was running out of patience with the fire department.

"I'm willing to give them the benefit of every doubt," he said. "But they've had six months to show us accurate records, and they haven't done it."

Hardy said county officials are waiting for the results of a regular state audit of the fire department before taking more drastic action.

Copyright 2012 Charleston Newspapers

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