RALEIGH — The Town of Robbinsville was hit with various financial mismanagement allegations per a state investigative audit released in December 2023.
Robbinsville is a town of around 545 people located in Graham County. Per the audit report, the town is operating on a budget of “approximately $1.8 million for the General Fund and the Water and Sewer Enterprise Fund” for the fiscal year ending June 30, 2024.
One of the issues involves town officials and employees failing to correct wage and tax statements (W-2) as advised by the North Carolina Office of the State Auditor (OSA) after an audit in 2019.
The audit also alleges the town violated open meeting laws, overrode internal policies, and neglected issues highlighted in annual financial audits, such as the lack of routine inventory counts in water and sewer maintenance during the fiscal years ending June 30, 2020, and 2021.
An example from the audit report includes the former finance director refusing to issue a $414 mileage reimbursement to a town alderman “due to a lack of prior approval for travel and supporting documentation of a valid business purpose for the travel.” The auditors found that the alderman overrode the decision by “issuing and signing a check to herself with the mayor as a cosigner.”
The town council’s override issue has been ongoing since at least July 2016, as revealed in an investigative audit report issued by the OSA in May 2019. The report highlighted instances such as town employees and officials spending over $34,000 on credit card purchases between July 2016 and February 2018 without sufficient documentation for a business purpose.
Additionally, between July 2016 and November 2017, more than $30,000 was spent on fuel without proper documentation, and from July 2016 to December 2017, over $15,900 in fringe benefits was received by town officials and employees but excluded from income reporting.
The OSA also found that the town council “lacked a written code of ethics as required by North Carolina General Statute § 160A-86,” and the mayor was unable to produce one for investigators.
Five of the six town bank accounts failed to have a reconciliation performed since at least July 2022, per the OSA. The combined balance of all six accounts recorded in the audit totals $2,297,985.
Three of the five bank accounts have been caught up and reconciled during 2023, per the town’s response to the audit.
The town’s mayor explained that the lack of completed bank reconciliations was due to the vacancy in the finance director position. Throughout the period the town lacked a finance director, the town clerk and mayor were tasked with reconciling bank statements, but neither fulfilled this responsibility.
Following the termination of the former finance director in July 2022, the former town clerk temporarily managed the responsibilities. Between March and May 2023, the finance director position changed hands twice.
In a response letter, Robbinsville town officials did not explicitly state they agreed with the findings but did list corrective actions to be taken, including creating a code of ethics and amending tax filings related to fringe benefits.
Concerning open meeting law violations, the letter blamed the town’s former attorney and said they had hired a new town attorney to “ensure” their meetings follow the correct procedures.
The letter also blamed the former town attorney for the lack of documentation supporting business uses of a personal vehicle and described the town as having followed “the attorney’s advice” but also following direction from the finance director.
Additionally, the town officials wrote that they would implement methods to ensure an “Alderman or employee cannot sign a check made to themselves.”
