JUNE 29, 2021 BY ANN WISHART 

AUDITOR SAYS MOVE WAS TOO HASTY, FORCED TO WITHHOLD PAYROLL

Geauga Park District Board of Commissioners unanimously passed three resolutions June 28 that will cut the cord between the tax-supported, nonprofit and the Geauga County auditor’s and treasurer’s offices.

Geauga Park District Board of Commissioners unanimously passed three resolutions June 28 that will cut the cord between the tax-supported nonprofit and the Geauga County auditor’s and treasurer’s offices.

With very little discussion, they approved bylaw changes that allow the GPD to handle its own finances in house, to designate Middlefield Banking Company as the district’s depository for about $14 million and to appoint a treasurer and fiscal officer to take on the duties previously under control of Geauga County Auditor Chuck Walder.

District Executive Director John Oros told commissioners it is “quite common” for a park district to have its own fiscal officer and this is a move that has been discussed for 27 years.

The GPD has been pursuing a fiscal transition since January, he said.

“We are hopeful (Walder) will work collaboratively with the district” to ensure a smooth transition, Oros said.

Commissioner Bill Dieterle questioned the likelihood of help from the auditor.

“This auditor has been a problem for us,” he said. “What do we do if he doesn’t?”

Oros noted legal counsel fortunately was present at the special meeting, but did not elaborate.

“Is it (Walder’s) obligation to help you? If it is his obligation, it’s not ‘hopeful’ — he must,” Dieterle said.

Commissioner Pat Preston offered another point of view.

“I’m not so sure he’s causing problems. Everyone’s entitled to his own view of how to conduct his job,” Preston said, adding, however, Oros’ office has had to do extra work to pursue the process.

“It’s not an efficient use of your time, John, and we’re seeing that’s most likely to persist,” said Preston, who has talked to people in other departments. “They have similar issues where the auditor is superseding their decision-making process.”

Preston said he had researched other entities in Geauga County that receive tax dollars, but operate without county supervision.

“I found Geauga County (Public) Library also has their own fiscal officer. It’s not unique in Geauga County for a public entity to have their own fiscal officer,” he said.

Dieterle questioned the resolution that designates Middlefield Bank Company as the park district’s depository for GPD funds.

Oros said it was the only bank in the county that responded to the published request for qualifications and it was on the list of financial institutions approved by the state auditor.

Dieterle asked if the district would have a special bank representative assigned to the GPD available on a daily basis and if Middlefield Bank’s investment policy had been considered.

“We’re not there, yet,” Oros said.

“Middlefield Bank is a great bank,” Preston added.

Dieterle said if the bank is going to be the keeper of taxpayers’ money totaling about $14 million, the commissioners need to have good communication with a bank representative.

“It’s a large deposit. We need to dot our I’s and cross our T’s,” he said.

The board also voted to hire Michael Frederick, who became GPD finance manager in April 2021, as the district fiscal officer and treasurer, effective immediately, for about $69,000 per year.

The same resolution authorized Oros to contact Walder and cause the transfer of the board’s funds to the park district’s fiscal officer/treasurer.

Park commissioners Mario Innocenzi, Dennis Ibold and Howard Bates also attended Monday’s meeting. The commissioners are appointed by Geauga County Probate Court Judge Tim Grendell, who has had a long-standing feud with Walder.

Resolutions Signed Too Soon?

In a letter Walder sent to Oros in February, he outlined 27 items the GPD needed to deal with in order to have a smooth fiscal transition, including many having to do with those that are the responsibility of the automatic data processing board.

The ADP is responsible for the county’s IT functions and Walder said the park district will have to establish its own network after July 1.

Preston, who is a businessman, said taking care of the items on the list is just a normal part of any transition.

“All those things are just common things. There’s nothing unique in his correspondence that you would not anticipate when starting a new entity,” he said.

Walder, however, voiced his concerns about the board’s preparation for the transition in a meeting June 22 with the ADP board and in an interview June 23.

Once the relationship between the county and the park board is severed, Walder said he cannot legally process payroll, due July 2, or allow his office to take care of the many items on the list.

The county auditor and treasurer have provided many services to the GPD for free, he said, estimating it could cost up to $1 million per year for the district to take care of those tasks.

“I have 45 people under my authority. (The park board) gets the resources of 45 people. This is a service we do at no cost to the parks,” Walder said, adding the board should be able to present a compelling argument for the public about the advantages taxpayers will receive for that additional expense.

Employee health insurance is another item that could become a new expense to the park district, Walder said.

He questioned the legality of an auditor paying insurance premiums for employees of an independent park district.

He provided emails between himself and Oros dating back to February where he explained the ramifications of the proposed transition. In one email, he noted the county ADP board, a division of the auditor’s office, voted to terminate its agreement with the GPD once the commissioners fill the position of treasurer.

“My office is currently amassing information concerning all of the many services it provides the GPD. With such information, the GPD will be fully informed as to the myriad functions that it will need to expend additional taxpayer funds on in order to ensure that its operations continue,” Walder wrote.

In a phone call late Monday afternoon, Walder said at 1:20 p.m., he received copies of the resolutions and bylaw changes.

“The verbiage in the two resolutions was very clear,” he said, explaining the wording in the resolutions “upon passage” mean the July 1 date to turn over the park funds was no longer the correct date. Severance occurred when the resolutions were signed.

“They moved the clock up to that moment,” he said.

Walder said Geauga County Prosecutor Jim Flaiz advised him it is now illegal for the auditor’s office to continue acting for the park district.

That means bills that were scheduled to be paid through Wednesday had to be pulled back, including payroll, Walder said.

While the documents were delivered, the packet did not include essential bank information that would allow him to turn over the $14 million.

“We need the account number, the routing number and the W-9 federal identification information,” he said, adding he has requested them.

Meanwhile, ADP personnel have been busy closing off services to the district, Walder said.

“It’s a hot mess. We’re doing the best we can,” he said. “Innocent people are going to be harmed.”

Walder said he doesn’t know why the commissioners are in a hurry to sever ties with the county before they are prepared and wondered if they had thoroughly read the resolutions before passing them.

“I’m not questioning their right to go independent. I’m questioning their way of doing it,” he said.