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By Ron Fonger, JOURNAL STAFF WRITER
The city retirement system’s books have not been separately audited for at least three calendar years, and some members of Flint’s Retirement Board are blaming Finance Director Marc Puckett.
Puckett, the Retirement Board secretary, last week announced that his staff failed to transfer pension funds into a money market retirement system account for about six months.
On Monday, Puckett said the pooled cash fund where the pension funds were mistakenly kept peaked at about $17 million — $8 million more than City Administrator David H. Ready acknowledged last week.
In December, transfers to the proper account restarted, Puckett said, and a final deposit, including interest earned, is expected to be made Wednesday.
Several Retirement Board members said the incident highlights the need for an immediate independent audit of the retirement system, which has assets of more than $800 million.
It’s been far too long. We need to push that forward, said Hugh Rose, vice chairman of the board.
These issues push the need for that even more.
Puckett said he’s worked with Arthur Andersen, a Detroit auditing company, to produce a stand-alone audit separate from the citywide audit by Dupuis & Ryden, a Flint accounting firm.
But several factors, including disagreements about terms of the audit, have slowed the process. The retirement board agreed to the audit in 1997. While Dupuis & Ryden reviews all city of Flint accounts in filing its annual audit, some Retirement Board members said they’ll feel more comfortable after a more concentrated review.
Arthur Andersen officials could not be reached for comment Monday, but Donald Phillips, a city retiree who represents United Retired Governmental Employees Local 1, said
the problem is they can’t get the figures from Puckett’s department.
We can preach and preach and preach … (but) our hands are tied, said Phillips.
Although members have debated whether the stand-alone audit is necessary, Ready said Monday he has
directed the Finance Department to make that happen ASAP.
Puckett said the pension transfers have been misunderstood since news about them broke last week. He insisted Monday that the two accounts in question are both retirement system accounts.
These funds have always been in the retirement (system), said Puckett. Mark Smith, a police lieutenant and retirement board member, said he’s troubled by what he’s heard in the past two weeks.
I’m definitely concerned, he said about the failure to transfer the money.
The question is, was it just a snafu or was it deliberate?
Puckett is expected to make a report on the transfer trouble at the Retirement Board’s Feb. 23 meeting. The board meets monthly to oversee Flint’s retirement system.
City Council President Scott Kincaid, who is circulating petitions to run for mayor, said the stand-alone audit should be performed.
An audit is just a check and balance of the system … Under Woodrow Stanley (there has been) resistance to having audits done, Kincaid said.
Ron Fonger covers Flint city government and Bishop Airport. He may be reached at (810) 766-6317.
Copyright Flint Journal / MLive Media Group (mlive.com). Used with permission.