ALLENTOWN, Pa. - Allentown City Council's Budget and Finance Committee Wednesday evening reviewed old accounting practices and agreed to develop new legislation whereby the city council would be unable to authorize spending money out of the capital budget without the associated revenue stream being present on the opposite side of the accounting ledger.
The discussion and clarification moderated by city councilman Peter Schweyer, who also serves as the chair of the budget and finance committee, was in response to critics who regularly attend council and committee meetings who have insisted $1.7 million is missing from the capital budget.
Schweyer confirmed the $1.7 million is not missing and added, "There are no adverse cash issues at this time and there has been no malfeasance or incompetence on anyone's part."
He further explained the allegedly missing $1.7 million was "the result of an old practice from 2005 of attaching revenue line items with the expenditure side which is something that no longer happens."
Schweyer added city auditors have to advise council, the controller's office, and the finance department on the matter as "this is a significant accounting issue."
City Controller Mary Ellen Korval remarked as per city ordinance when there are leftover funds following a capital expenditure approved by council, those monies have to be put before council who vote on their disposal.
In response to critics' questions as to why the accounting error wasn't detectible in the 2005 capital plan , Allentown Director of Finance Gary Strathearn stated, "Some records back that far simply do not exist."
Schweyer also noted since 2005, auditors contracted by the city to review accounting and financial matters have changed.
Allentown, PA 18102