Audit Forces City To Look At Partnerships With Local Nonprofits

A recent audit found that the city had been contributing money to some nonprofits without proper authorization, however, the city manager thinks there was some miscommunication.

After its annual audit, the City of Richfield is now looking at how to continue funding its partnerships with local nonprofit service agencies.

According to City Manager Steve Devich, when the audit findings were released to the city, the auditor randomly pulled one of the payments made to a social service agency. The auditor found that the city didn't have statutory authority, or charter authority, to make the so-called donation. This prompted a look into all payments to service organizations.

However, Devich believes there was some miscommunication between the auditor and city staff. He said the city has service contracts with all the agencies it partners with, which he thinks the auditor wasn't aware of when the payments were studied. Service agreements essentially buy services from an organization that could otherwise be provided by the city.

"That potentially changes the entire premise of the payments," he wrote in an e-mail to Richfield Patch. "Since they are not grants but instead, allowable contracts for purchase of services."

Now, city Attorney Corrine Heine and Devich have to evaluate the services to make sure they are something the city could offer itself. The two sat down last week to look at each organization. Devich was confident that many of the agreements would go forward.

"It seems to me," he said at a city council meeting Tuesday. "That the overwhelming majority of the ones that we've given to in the past are ones, that I believe—with the type of service agreement we have—we could continue to make those purchases from in the future."

Among the local organizations the city partners with are VEAP, Cornerstone, MIRA and The Family Partnership, according to a KAALtv.com article.

Once Devich and Heine have met again with the auditor and have come to a conclusion on how to continue the contracts, an update will be given to the city council. Richfield Patch will also update readers as more information becomes available.


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