Results of the audit, requested by the water development district's board of directors early this year, were presented doing a special meeting on Thursday in Huron.
In the audit's executive summary, the state Department of Legislative Audit made 16 recommendations to the water development district to help it better track finances. The audit looked at transactions in 2009 and 2010. It cost roughly $14,000, said board member Larry Lovrien, who took office in January after being elected in November 2010.
According to the audit's executive summary, the recommendations involve:
• Internal controls over authorizing, monitoring and reporting of consultant contracts.
• Internal controls over travel expense reimbursements and rates.
• Having proper supporting documentation for restaurant expenses charged to motel rooms.
• Having proper supporting documentation for credit card use.
• Complying with state bid laws.
• Financial reporting to the board of directors.
Some of the recommendations have already been put in place, said Lovrien and fellow board member Randy Grismer of Aberdeen.
The audit report is 38 pages long. Grismer said similar documents are generally between three and six pages long. In other words, he said, there's a lot to digest, and there's room to improve some of the mistakes made in recent years.
He said board members voted unanimously to accept the audit report's recommendations without contesting its details.
Lovrien said he hopes the audit will restore public trust in the James River Water Development District, which has taxing authority to fund projects designed to help improve the James River watershed.
Board members will discuss how to start implementing the bulk of the recommendations in the audit report during their next meeting in January in Pierre, he said. They imposed a July 1 deadline to put new policies in place, he said.
The audit revealed some problems involving conflicts of interest and overseeing expenses, Lovrien said.
Lovrien raised concerns about the district's finances when he ran for election and said then he would seek an audit, if elected. And last year, state Sen. Al Novstrup, R-Aberdeen, butted heads with Darryl Raschke, general manager of the James River Water Development District, over access to financial records.
In 2010, the Legislature voted to roll back the property rates charged by the water development district, which are modest compared to those charged by counties, cities and school boards. The district had more than doubled them after its boundaries were expanded via a 2009 state law.