Maverick County Commissioners Court approve resolution to hire Auditor to audit County Auditor

By: Jose G. Landa, Copyright 2015, Eagle Pass Business Journal, Inc.

Maverick County Commissioners Court unanimously approved a resolution to hire an independent expert accountant or auditor to audit all the books, records, and accounts of Maverick County Auditor Fidencio Ortiz at their regular monthly meeting held on Monday January 12, 2015, escalating their feud with County Auditor Ortiz on who is to blame for Maverick County’s poor financial record keeping and the consequences arising from the deficient administration of County budgets, funds, and audits during 2011, 2012, and 2013.

County Judge David R. Saucedo called agenda items Nos. 25 and 26 calling for “discussion and possible action approving and adopting a Resolution of Maverick County Commissioners’ Court pursuant to Section 115.031 of the Texas Local Government Code to authorize and employ an expert public accountant or auditor to audit all books, records or accounts of the County Auditor,” and “the discussion and possible action for the employment of a disinterested, competent, and expert public accountant or firm to audit all books, records or accounts of the County Auditor pursuant to the Resolution approved and adopted by Maverick County Commissioners Court and as per Section 115.031 of the Texas Local Government Code.”

Judge Saucedo announced that Commissioners Court would go into Executive Session to discuss agenda items nos. 25 and 26 to consult with legal counsel and later return to Open Session.

After consultation with special legal counsel Luis R. Vera, Jr. of San Antonio, Texas, Judge Saucedo opened agenda item No.25 for discussion, proceeding to read a resolution authorizing Commissioners Court to employ an expert public accountant or auditor to audit all books, records or accounts of the County Auditor.

Interestingly, Judge Saucedo read a new, revised resolution than the original resolution that he previously read at the December 29, 2014 meeting, incorporating new language and reasons why Commissioners Court should hire an independent auditor to audit the County Auditors records. The main changes to the resolution provides alleged deficiencies and omissions allegedly committed by County Auditor Ortiz after his appointment on September 24, 2012 instead of past deficiencies and omissions of the County Auditor’s office prior to September 24, 2012 originally alleged in the December 29, 2014 draft of the resolution.

“Judge Saucedo proceeded to read the following resolution: “The Commissioners Court of Maverick County, Texas meeting at a regular session on the 12^th of January, 2015 among other proceedings consider the following resolution. “ Whereas, the Maverick County Auditor Fidencio Ortiz was appointed by District Judge Abascal and District Judge Muniz for a term of two years; Whereas, the County Auditor has supervision over all books and the records of all the offices in Maverick County and to see the strict enforcement of the law governing Maverick County finances; Whereas, the County Auditor term has expired and the District Judges for Maverick County have failed to appoint a successor county auditor; Whereas, the County Judge and County Commissioners are concerned with the expenditure of funds and accountability of the County Auditor; Whereas , Martinez Rosario & Company LLP, an auditor, was engaged by County Commissioners Court to audit the financial statements of the governmental activities, the business type activities of each major governmental fund, the aggregate remaining governmental funds information, the majority proprietary fund for the water utility operations, aggregate remaining proprietary funds information and the agency fund for Maverick County Texas; Whereas, the Auditor found the following material weaknesses and material non-compliance within the County’s financial statements due to the omissions and negligence of the County Auditor.   Their remains errors in accounts payable that are causing financial statements to be misstated, the auditor has discovered that the accounts and records are not correct, and there are errors with accounts payables due to a lack of supervision and training, There were no period and end procedures to assure the transactions were recorded in the appropriate accounting period, this finding has been repeated the last several years and has not been corrected, The County Auditor took one year from end of fiscal year September 30,2013 to close Maverick County books, In addition, no review and approval process existed as part of the financial statements process to ensure accuracy of journal entries, account reconciliations, financial statements and related disclosures, self- assurance fund activity remains to be reconciled and properly accounted for as of September 30, 2013, there was no process to track or record the liability associated with the county self – assurance program, there was no monitoring and reporting of the county’s risk financing liabilities and expenses associated with unpaid self -assurance claims, therefore liabilities and expenses may not be reported in the county’s financial statements also without proper monitoring tools and process for managing its risk finances the county risk incurring significant liabilities or contingencies without its knowledge or control. In addition, the county’s risk financing may not be properly disclosed which will cause a departure of accounting principals generally accepted in the United States of America, improper capital assets financial reporting, failure to present capital assets in the proper activity or fund of the county’s financial statements will result in the financial statements being misstated, failure to record depreciation will result in an understatement of expenses and an overstatement of assets, county operating results will also be misstated, failure to maintain a list of capital assets purchase with prior year grant funds expended may result in material non-compliance with grant funds, the county currently lacks appropriate and accurate capital past set records in accordance with series 2011 B and 2012 TAC notes, bonds, and covenants the county was restricted to the use of those bond proceeds. We are unable to determine the county’s compliance with the debt covenants of series 2011 B and series 2012 TAC notes due to a lack of adequate accounting records for the county debt transactions by the county auditor; Whereas, the county auditor continues to serve in his role over all the books and records of Maverick County and financial records even though his term has expired and the findings and opinion of the auditor is that the county auditor should be changed; Whereas, based upon the findings of the auditor it is an imperative public necessity that the Commissioners Court employ an disinterested, competent, and expert public accountant or firm to audit all books, records or accounts of the County Auditor to determine any damages, if any, as a result of the findings and opinions of the Auditor. Now, therefore, be it resolved that the Maverick County Commissioners Court of Maverick County, Texas have determined the following, resolved, based upon the findings and opinions of the Auditor, the County Auditor due to intentional omissions and negligence has potentially caused damage and harm to the county; Further resolved, the County Auditor has failed to keep accounts, make reports or account for public funds as required by law, and further resolved, the audit of the County Auditor is justified by an imperative public necessity and would best serve the public interest based on all the above enumerated factors; Further resolved that Maverick County Commissioners Court employ an disinterested, competent expert public accountant or firm to audit all books, records or accounts of the County Auditor to determine any damages caused by the county auditor because of his failure to keep accounts, make reports or account for public funds and due to county auditors omissions and negligence.”

Judge Saucedo’s resolution uses and relies upon Maverick County independent auditing firm, Martinez Rosario & Company, LLP, findings and reports as the primary basis and foundation for the resolution and the reasons why Commissioners Court should hire an independent auditor to audit the County Auditor.

Judge Saucedo proceeded to agenda item no. 26 and called the item for discussion and motion of vote or other action.

None of the Commissioners had any discussion on agenda item no. 26 and there being none, Judge Saucedo called it for a vote and Commissioners Court unanimously approved to hire an independent, expert accountant or auditor to audit the County Auditor’s books, records, and accounts.

After approval by Commissioners Court, Judge Saucedo noted that he wished to inform the public that the discrepancies noted in the resolution have allegedly occurred under County Auditor Ortiz’s tenure. “These are things that this auditor (Ortiz) has refused to do. It has nothing to do with the previous auditor. These discrepancies remain under that administration which is the new auditor that is in there right now, Mr. Ortiz,” said Judge Saucedo.

Maverick County Commissioners Court have certainly escalated their feud with County Auditor Ortiz by approving these two agenda items. Previously, County Auditor Ortiz has denied these allegations. Now, Commissioners Court may have to advertise for the hiring of an independent, expert accountant or expert or may seek to waive this requirement due to a public necessity emergency.

Meanwhile, District Judges Abascal and Muniz await the appointment of a third district judge so a meeting can be held to determine who should be appointed County Auditor. Earlier, County Auditor Ortiz was the sole applicant for the job but District Judges Abascal and Muniz split on his re-appointment with Judge Abascal in favor and Judge Muniz against.

This feud between Maverick County Commissioners Court and County Auditor Ortiz is costing Maverick County taxpayers millions of dollars in lost state and federal grants as well as other financial losses to the detriment of taxpayers. Maverick County taxpayers will hold whomever is responsible for the County’s poor and dismal financial records and administration responsible in one form or another. Stay tuned.