Members of the county’s Audit Committee met Monday evening at the Elizabethton/Carter County Animal Shelter to discuss the findings of a state investigative audit into shelter operations and to get an update on how the county is correcting the issues reported by the state.

“Our purpose as the Audit Committee is to ensure the procedures are being followed,” Committee Chairwoman Margaret Moses said. “Our meeting tonight is not to beat up on anybody or beat up on the past. We’re moving forward.”

In addition to the audit committee, representatives of the Animal Shelter Board, shelter employees, Commission Chairman Dr. Robert Acuff were in attendance.

On Dec. 7, 2017, Tennessee Comptroller of the Treasury Justin Wilson released a report on the findings of the investigative audit into the shelter. The audit noted “a cash shortage” of $9,516 existed within the shelter as of June 2, 2017. According to the Comptroller’s Office this shortage was due to missing adoption fees; rescue fees that were collected by the shelter but later sent to the Friends of the Elizabethton-Carter County Animal Shelter group; fees for shots and microchips that were given to the Friends group; and money donated to the shelter that was deposited to the Friends group bank account.

Investigators with the office also detailed a list of 14 separate operational deficiencies at the shelter and noted a lack of proper oversight of shelter operations.

Moses asked for clarification on the different groups mentioned in the audit report, namely the Animal Shelter Advisory Board and the Friends of the Animal Shelter group. Mike Barnett, who was a member of both the Advisory Board and the Friends group explained that the Friends group started as a nonprofit organization, and was recognized by the IRS as such, to help raise funds to build the shelter. After the shelter was opened, Barnett said the Friends group continued to support the shelter through donations and by purchasing needed items. Because the shelter is a government agency, it cannot solicit donations. The Friends group, as a nonprofit, was able to hold fundraisers to support shelter operations, Barnett said.

Barnett said there was a misconception in the public following the release of the Comptroller’s report that the $9,516 was missing. “There’s not stolen money. Nothing has been stolen,” Barnett said. “It was misappropriated into the wrong account.”

During the time frame covered by the audit, Barnett said donations to the shelter were often forwarded to the Friends group to purchase items which were needed quickly because it was very time-consuming for purchases to be made through the county due to the approval process.

Some of the funds listed in the audit were reimbursements which the animal shelter made to the Friends group for purchasing vaccinations which were used at a shot clinic hosted by the shelter.

According to Barnett, some of the funds directed through the Friends group account were used to pay for medical care for shelter animals. Barnett said he and shelter’s veterinarian Dr. Ashley Eisenback were not able to review records to see how much of the funds were related to legitimate medical care expenses because those records had been removed from the animal shelter by Carter County Mayor Leon Humphrey and not yet returned.

“Our Board has voted to have our attorney write a letter to get those records returned,” said Commissioner Buford Peters, who serves on the Animal Shelter Board. “That has been done, but we haven’t gotten a response.”

Barnett said he and Eisenback have also attempted to get the records returned.

“We have now filed a police report to get those records back that should have never left this facility, regardless of who took them,” Barnett said.

The audit report from the state recommended that the county work to recoup the $9,516 cash shortage, and Moses asked if that was the county’s intent.

Finance Director Christa Byrd said she would need some direction from the County Commission as to how they want to proceed with the matter.

Barnett said the Friends group admits there are funds within their account that need to be returned to the county, but he contested it was not the full amount listed in the audit because some of those funds were money reimbursed to the Friends group.

Byrd explained that the county could not accept a donation and then give the money back. If some form of reimbursement agreement were to be entered into, that agreement would have to be approved in advance by the full Commission and no such agreement was approved, she said.

Barnett said he “did not like” the idea of having to pay back funds they had already donated, but if that was the decision the Friends group would abide by it.

According to Barnett, those decisions were made during meetings of the Animal Shelter Advisory Board and Friends of the Animal Shelter group, which he said were attended by Humphrey and a county commissioner. During those meetings, no questions were raised regarding whether or not that was the correct way to handle the donations and purchases.

Moses stated she had read the auditor’s comments that the Animal Shelter Advisory Board did not provide proper oversight and asked how the oversight was being handled now.

“When this all happened the sole person in charge was the Mayor,” Barnett said, adding the Animal Shelter Advisory Board served only to assist the mayor. “We were there to support the Mayor and advise the Mayor. The Mayor was ultimately the sole oversight for the shelter.”

Since that time, both Barnett and Peters explained, a new Board has been formed that has complete oversight of shelter operations. The new Board consists of three county commissioners, three members of Elizabethton’s City Council, and a member of the public at large.

Peters also explained that a set of policies and procedures was adopted to address the issues noted in the audit and the shelter Board and staff are working to refine those procedures to make them even better.

“You all have made a lot of progress,” Moses said. “I feel good about it, and I feel we’re on the right track.”

Moses said the committee would be willing to help in any way the shelter might need them to when it comes to setting policies and procedures.