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Public Notices

April 17, 2014

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Questions Raised About Chuckey Utility District's Practices

Sun Photo by O.J. Early

The County Water Office, located at 800 West Andrew Johnson Highway, serves as the joint office for Chuckey and Cross Anchor utility districts.

Originally published: 2014-01-10 11:10:17
Last modified: 2014-01-10 11:20:47

Audit Raises Questions About Utility District's Practices, Oversight Of Joint Account



Missing records, allegedly altered minutes and several unauthorized purchases are among numerous findings released Thursday in Chuckey Utility District's annual audit.

Local Certified Public Accountant Mickey Ellis reported in October that his preliminary findings showed "questionable practices by the management," prompting the Chuckey Utility District Board to place four employees on leave without pay.

Cross Anchor Utility District, which works out of the same office and utilizes many of the same employees, took the same action.

Employees placed on leave include: former manager Shirley Collins; her husband, Willie; their daughter, Kandie Jennings, who became acting general manager after Shirley Collins retired; and Jennings' husband, Bill.

Attempts to reach these individuals for comment have been unsuccessful.

The Tennessee Comptroller of the Treasury is conducting its own investigation and has discussed the matter with the Tennessee Attorney General, according to the utility districts' attorney, Ed Kershaw.

The state comptroller's office declined to comment or acknowledge an ongoing investigation, which is its normal policy.

Ellis' audit featured 17 findings, the majority of which he said are "material weaknesses," while others he characterized as "significant deficiencies."

Several findings he notes as violations of state law.

Chuckey Utility District President John Carter, who also serves as a county commissioner, discussed these findings shortly after their release Thursday.

He said he was aware of most of them, as they had been revealed over the months since Ellis indicated his preliminary findings. Others, however, came as a surprise, he said.

Carter said the audit, which examines records from the July 1, 2012, through June 30, 2013, fiscal year, may not include the full scope of the issues at the utility district, as he believes questionable actions may have been going on for years without the board's knowledge.

Although Carter said the board failed in some instances to pick up on the things going on in the office -- for example, large cell phone allowances, family members working under the same district, alleged unequal treatment and threatening of employees by former management -- he also noted that the Chuckey Utility District received largely "clean" local audits with very few findings before this year.

At state meetings for continuing education, the district was described to him as one of the best in the state, he added.

Carter expressed his belief that, should the state Comptroller's Office audit the district beyond the past fiscal year, more findings will emerge.

For example, the Chuckey and Cross Anchor utility districts have a joint "force account," out of which they jointly pay employees and purchase equipment for line extensions and repair projects.

Because this account is not a "government entity," it is not audited, according to the districts' bookkeeper, Stephanie Wallin.

Both boards have cited the force account as an area of concern and a place where unauthorized actions may have taken place.

"There's no way of overseeing that account," Carter said on Thursday.

He indicated that, among those actions causing the boards' concern was the unauthorized purchase of a truck during the last fiscal year.

Wallin and current Office Manager Beth Fletcher confirmed that a truck was purchased through the force account at the end of 2012.

Chuckey Utility District has ownership of eight vehicles, but this does not include vehicles purchased with funds in the joint force account, according to the staff.

In total, the district employs 14 individuals, including two of those placed on leave, although some of these include individuals who only work for the force account during special projects, according to Fletcher.

For more information and stories, see The Greeneville Sun.

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