State Comptroller Thomas DiNapoli’s office announced Wednesday that the Port Washington Fire Department needs to “improve its budgeting process” after completing an audit of the department.
The audit, which examined the fire department’s financial operations from Jan. 1, 2012 to June 30, 2015, said that the department’s budget expenditures had been underestimated by 4.82 percent in 2012, 4.34 percent in 2013 and 0.93 percent in 2014.
“The Board and budget committee should develop and adopt structurally balanced budgets that include realistic estimates of expenditures and an indication of how much of their net assets, if any, they plan to use,” the audit said.
This was the first time the department had been audited by the state comptroller’s office.
Brian Butry, a spokesman for Comptoller DiNaploli’s office said the audit was “very basic” and part of “standard risk assessment.”
“We make this recommendation frequently,” Butry said. “[It is] commonplace.”
Michael Tedeschi, chairmen of the department’s board of directors, said he was “pleased to report only one recommendation to a change in financial operations” at the department.
“The department is in agreement with the comptroller’s findings and has made the recommended change to its policies and procedures,” Tedeschi said.
In a one-page letter written in response to the audit, Tedeschi said the “Board of Directors attempted to reduce appropriated expenditures by reducing the estimated appropriations.”
But, the letter said, that this “was not realistic.”
“The department’s intent was rather than charge the taxpayers for the full cost of operating the department headquarters and four component companies; the board willfully made the decision to reduce net assets and cash reserves for balancing the budget,” the letter said. “[Offfice of the State Comptroller] auditors rightly pointed out that this is not a viable long-term strategy. Continuing this process would deplete the net assets and the necessary fund balance that would be needed to operate an efficient fire protection and emergency medical service.”
The department has contracts for the provision of fire protection services with the Town of North Hempstead, and the villages of Flower Hill and Plandome Manor, amongst others the audit said.
The department consists of four companies, the audit said, including Atlantic Hook and Ladder Company No. 1, Inc. Protection Engine Company No. 1, Inc., Flower Hill Hose Company No. 1, Inc. and Fire Medic Company No. 1, Inc, all located in Port Washington.
There are approximately 300 active members in the department, the audit said.
Revenues for 2014 included $3,831,536 received from the town and villages for fire protection services, the audit said.
The department also received revenue from fund-raising, donations and grants.
In 2014, the department’s total revenues were $4,151,819 and expenses totaled $3,873,435, the audit said.
“The department is operated in accordance with its bylaws which stipulate that the Board of Directors is responsible for the department’s overall financial management,” the audit said. “The Board is composed of the Department Chief and an elected representative from each of the department’s four component companies. The [B]oard [of Directors], together with another representative from each company, annually form a budget committee that reviews the five preliminary budgets submitted by the department and each of the companies. Once this committee has approved the five individual budgets, they are merged together to form the official department budget.”
