xml:space="preserve">
xml:space="preserve">
Advertisement
Advertisement

Baltimore liquor board audit reveals only one repeat finding left over from 2013

A state of Maryland audit released Thursday revealed that Baltimore’s Board of Liquor License Commissioners has fixed all but one of the problems exhumed in a lengthy 2013 audit.

The audit says there has been “continual improvement” since a 2013 audit found 24 issues with the board. However, the 53-page report by the state Office of Legislative Audits still details eight areas where the board could improve. Most are related to the board’s policy and procedure manual needing to be more robust in licensing, inspections, disciplinary procedures and management oversight.

Advertisement

The board, which oversees liquor licenses for more than 1,200 establishments in the city, is required to be audited at least once every four years. Since discovering a lengthy list of issues in 2013, an audit in 2016 identified 18 necessary improvements and now the most recent investigation details only eight.

Senate President Bill Ferguson, a Democrat, signaled in a statement Thursday that the latest audit was a success.

Advertisement
Advertisement

“After six years, this audit shows only one repeat finding and all other issues addressed,” he said in an emailed release. "In a time where trust in government is low, it is important to show that with proper oversight and accountability, we can ensure that government works for the people.”

Liquor board chairman Albert J. Matricciani Jr. wrote in response to the audit that the board agreed with most of the findings. However, the chairman said it disagreed with two.

The audit, conducted from December 2018 to April 2019, determined that the only actions from previous audits that needed improvement were record keeping and procedures with cash receipts.

The board did not always follow procedures for securing and processing cash receipts, the audit said, and it needs better procedures for making sure all money has been properly deposited.

Advertisement

Checks were not always endorsed right away, the audit said, and in some cases, undeposited and unendorsed checks were left in an unlocked box overnight. The audit also found there was a lack of separation of duties between employees depositing money and those responsible for record keeping.

The liquor board disagreed with the audit’s recommendations to improve in those areas and said it is “common practice” for employees to take invoices back to their desk and then invoice the checks. The board also said a lockbox was left out only once, and that auditors checked only one time throughout their four months on the site. And to help keep duties separate, the board said it hired a new accountant in 2017 and that the receipts were missing because the city did not provide them to the employee.

Auditors said the liquor board also did not have an internal process to identify potential conflicts of interest that aligned with state law. The board believed employees’ State Ethics Commission annual disclosures were sufficient, which the commission agreed with, but the auditors said the disclosures were “not tailored to address the independence requirements” of state law.

“We were advised that it was understood that some agencies impose ethical standards on their employees that exceed the requirements of Public Ethics Law," auditors said.

Auditors also found that inspections produced by the board did not include “certain critical aspects." Inspection reports were not always disclosed or retained by the board, so auditors said information was occasionally not recorded accurately. Sometimes, the information was also not independently reviewed for accuracy.

Of 60 establishments that auditors selected to review, the board was able to produce only 20% of the inspection reports. Additionally, the audit said there was no formal schedule created for necessary follow-up or required inspections after a violation. Follow-up visits were also sometimes missed and conclusions were not always documented, the audit said.

The liquor board disagreed and said for each of the cases identified, a violation was issued or it wasn’t warranted. It also said that frequently the follow-ups require the assistance of law enforcement so the board shouldn’t be held responsible for it.

Auditors said the process of inspecting already licensed establishments did not make it clear that they were subject to annual inspections or done at proper intervals.

“Based on our analysis of activities recorded in the database for license year 2018, approximately 20 percent of the activity included in the inspection goal and monitoring reports did not represent activity related to the goal,” auditors said.

Auditors detected issues with the board responding to the city’s 311 complaints. In the audit, 15 complaints were investigated; of those, 12 were not investigated properly. Of those 12, seven had “multiple deficiencies," including the lack of documentation and failure to contact the person who filed the complaint.

The liquor board tracked only licensee noncompliance, such as building violations, that were recorded by the Baltimore Police Department and Baltimore City Sheriff’s Office, auditors said.

Recommended on Baltimore Sun

Advertisement
Advertisement