Another audit of Camden makes 50 recommendations for change

A state-funded audit of the City of Camden - the second review of the 2008 fiscal year - lists 50 recommendations for cutting costs, improving operations, and preventing fraud.

Auditors did not turn up violations of the law, as previous auditors have, but indicated Camden is out of step with some methods of modern governance.

In a written response released with the audit yesterday, city officials agreed with most of the findings, saying some matters had been addressed and corrective action was in the works for others.

In a sense, the state was auditing itself. New Jersey has controlled Camden's operations through an appointed chief operating officer since 2002, when the Legislature approved the biggest municipal takeover in U.S. history. And since early last year, top-ranking officials from the state Department of Treasury have worked in City Hall.

This $103,068 audit by Mercadien accountants in Princeton was required for the eight cash-strapped municipalities in New Jersey that receive "special municipal aid" from the state. It covered fiscal year 2008, when Camden received $61.8 million in such aid.

Another audit covering that time period, released in March, said city finances were in such disarray that an opinion could not be rendered. This audit was less critical.

Auditors found a "notable lack of formal written policies and procedures throughout the operating areas," and several cases where a lack of employee training adversely affected city operations.

Over the year studied by the auditors, the tax collector's office was defrauded of $43,000. City officials, according to the response documented in the audit, will conduct fraud detection training for employees.

Several recommendations deal with the Bureau of Grants Management, which collects monetary awards upon which the city relies. The city's own policies regarding the documentation of grants have not been followed, auditors said.

Other recommendations focus on union contracts, most of which are expired.

The auditors said the city should consider reducing the maximum amount of leave for police officers and firefighters injured on duty (currently one year), and decreasing the payment to employees and retirees who opt out of health coverage (currently totaling $1.25 million a year).

Additionally, unlike the State of New Jersey, the auditors said, Camden does not cap the payment of unused sick time for retiring employees. They said it should be capped at $15,000.

Interim Chief Operating Officer Albertha Hyche did not return an e-mail with a list of questions about the audit.

Council President Angel Fuentes questioned the need for another state study of the state-run city, and said money could be put to better use.

"I sense there's too much bureaucracy," he said.

Previous audits and similar reports have been virtually ignored in City Hall.

Most notably, a $210,000 management study to reform the City Hall bureaucracy was funded by the state after the takeover, but none of the recommendations was implemented.

In 1996, local fiscal watchdog Kelly Francis was appointed to a commission to work with officials to address more than 200 problems cited in an annual audit. The group was disbanded the following year.

"They pay hundreds of thousands of dollars on studies, and they just go on the shelf," Francis said.

The auditors' report dates to July 30. The state Department of Community Affairs, which released the document on its Web site yesterday, said state officials needed to first review the findings.