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Sutton: Double-billing was honest mistake [American News, Aberdeen, S.D.]
[October 01, 2014]

Sutton: Double-billing was honest mistake [American News, Aberdeen, S.D.]

(Aberdeen American News (SD) Via Acquire Media NewsEdge) Oct. 01--A contractor's double-billing for a computer, discovered by a state audit, was an honest mistake as opposed to an attempt to deceive, said the chairman of the Brown County Commission.

Duane Sutton said the county has thoroughly investigated the incident and taken appropriate action.

That includes implementing a policy that the county no longer purchase products or equipment from the company it contracts with to provide information technology services, Sivertsen Technology, of Aberdeen. The step was among those taken as a result of the findings of the annual audit that determined internal controls over the purchase of equipment from the contractor were inadequate.

After a closed session to discuss personnel matters during Tuesday's commission meeting, commissioners also decided to move ahead with hiring a chief information technology officer and end the contract with Sivertsen Technology. The aim is to have the head of the department be a county employee, Sutton said. The salary range for the job will be $70,000 to $130,000.

Sutton said the audit's findings was one of the factors in wanting to hire a full-time information technology director. But, he said, the commission has budgeted $50,000 for the slot each of the past two years, but never made a hire.

There's nothing that would keep Paul Sivertsen, chief executive officer of Sivertsen Technology, from applying for the job, commissioners said.

Pat Hale, who is running as a Democrat for a spot on the county commission, said during the meeting he wouldn't hire Sivertsen were he on the commission.

"That's your prerogative," Sutton said.

During the audit, a voucher from Sivertsen Technology was tested. The voucher contained an invoice for a new computer system installed at the sheriff's office. According to audit findings, the invoice did not have a serial number for the Lenovo desktop and accessories that cost $466.

It was subsequently determined that a computer with the same serial number had been purchased and installed at the landfill in 2011, according to the audit report.

In 2012, the county purchased two computers for the landfill for $908. They were part of a system to monitor landfill trash drop sites at the Brown County Fairgrounds and on South Fifth Street. But, according to the audit report, they were found to be inadequate and replaced with two Dell computers that had been salvaged from the landfill.

According to the audit report, the county was in a hurry to get the surveillance system installed and neglected to declare Lenovo computers surplus property before Sivertsen Technology substituted the Dells. The contractor took back the Lenovos and did not charge the county for the Dells, the audit found.

The county's rush to get the system in place and failure to declare the computers surplus property and Sivertsen's attempt to correct the mistake only convoluted things, Sutton said.

Sivertsen Technology provided to auditors a canceled check from the company to a third-party for $650 that said "2 used Dell" in the memo field, but the audit found that the third party had never sold Dell computers to Sivertsen Technology.

"The third party then provided an image of the check from his deposit records and the memo field on that check image contained 'Mac Book Pro 17.' We then obtained directly from the third party's bank a copy of the contractor's check. The memo field of the check image provided by the bank also contained 'Mac Book Pro 17,'" according to audit findings.

Additional steps the county has taken after the interaction with Sivertsen Technology include: -- Adding steps to more closely track and document all inventory in all departments.

-- Requiring county departments to include serial numbers of any products or items that have them on both the purchase invoice and updated inventory list.

-- Garnering reimbursement of $908, to total paid for the two Lenovo computers, from Sivertsen Technology.

"The Brown County Commission is committed to ensuring taxpayer dollars are spent wisely and tracked appropriately," the county's response to the audit reads. "It views this incident as a serious deviation from that ongoing commitment. After Brown County officials were notified of the details surrounding this transaction, changes were immediately implemented to prevent similar problems in the future." Under a contract with the county, Sivertsen Technology is paid $50 an hour for information technology services. Last year, the contractor billed the county for 2,7201/2 hours for a total of $136,025 plus $15,766 in supplies and equipment, according to the Brown County Auditor's Office. So far this year, Sivertsen Technology has billed the county for 2,0361/2 hours for a total of $101,825, plus $4,106 in supplies and equipment, according to the auditor's office.

Follow @ScottReports on Twitter.

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