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11/27/2018 6:32:00 PM
State calls out Gary over EMS-related revenue, spending

Lauren Cross, Times of Northwest Indiana

GARY — A state audit released Monday flagged the city of Gary for improperly withholding EMS-related revenue from the city’s General Fund since 2012 and inappropriate spending from that same account. 

The State Board of Accounts audit notes the city’s ambulance/EMS non-reverting fund was created in 1994 for the purpose of accounting for the receipt and disbursement of ambulance fee collections to be used for maintenance and for replacement ambulances and equipment for EMS operations.

The ordinance also required that 50 percent of the revenue be receipted to the city’s General Fund. 

The ordinance, which has been changed three times since 1994, was amended in 2012, requiring any funds be used exclusively for EMS expenses, but did not address the 50 percent posting formula, the audit states.

In a Nov. 21 response, Controller Angela Hayes stated the city of Gary disagrees with the audit’s findings, saying that it was “implied” in the amended 2012 ordinance that the 50 percent funding formula be rescinded.

“There, the City disagrees that (50 percent) of the revenues collected should be deposited into the general fund,” Hayes wrote.

If recorded properly, just over $2 million of ambulance fees should have been recorded in the General Fund in 2017, SBOA officials said. 

“We have another example of inefficiency in government,” Gary Councilwoman LaVetta Sparks-Wade, D-3, said of the audit’s findings Monday.

Sparks-Wade said while she understands the SBOA is short-staffed, she had hoped more would have been uncovered in the report.

Several questions remain as to the city’s misuse of $8.2 million from the EMS fund since January 2015.

It was found earlier this year that the city was pulling money from the restricted account — from Jan. 1, 2015, to March 31, 2018 — to cover payroll and other expenses.

Of that, $1.3 million was inappropriately transferred to the city’s Blight Elimination Fund, a reimbursement account for federal Hardest Hit grant money to help tear down blighted homes.

“Once we were reimbursed by the federal government, where did the money go?” Sparks-Wade said.

Sparks-Wade had called for an independent investigation earlier this year into the fund’s misuse, but a council-led Investigations Committee recently suspended its own probe. 

“I don’t feel that all of our questions have been answered,” Sparks-Wade said. “Since the majority of the colleagues are not willing to delve any deeper, I’m going to defer to whatever authority is responsible for ensuring millions of dollars from federal funds are accounted for.”

The SBOA also found other revenues received on behalf of the Fire Department, such as ambulance run reports, fire equipment bid fees, fire report collections, and more, were improperly reported to the EMS fund instead of the General Fund.

The city agreed, and stated it would submit to the City Council a “more concise ordinance in line with the City’s needs for these funds.”

Ethics law

The state audit also found that Gary City Councilwoman Mary Brown must reimburse the city’s Sanitary District for $132,748 she earned from Oct. 14, 2016, through June 26 of this year as an past employee there.

The request comes on the heels of a Lake Superior Court judge’s ruling June 25 to uphold a state law against double dipping, ruling in favor of Indiana Attorney General Curtis Hill and Indiana State Examiner Paul Joyce, who defended the ethics law.

The SBOA audit states Brown was re-elected in November 2016 and began her new council term in January 2016, and thus, her continued employment with the Sanitary District did not comply with state law. Brown agreed to quit her job, rather than give up her 3rd District Council seat, following the court’s decision.

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Editor, John C. DePrez Jr.; Executive Editor, Carol Rogers; Publishers: IBRC and IAR

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