In-County Travel
(226) The BCC’s written policies and procedures regarding travel refer to travel
allowances; however, it was not clear whether the BCC’s intent was to provide for a
travel allowance as contemplated by Section 112.061(7)(f), Florida Statutes, and
consequently, whether payments made pursuant to the BCC’s policy should have been
subject to withholding for Federal income tax and other employment taxes.
(227) BCC Personnel Policies Section 5.50, regarding Commissioners’ travel,
provides, " The Commissioners in-county maximum travel allowed for reimbursement is
2,000 miles per month effective December 1, 1996. County Commissioners may opt to keep a
daily mileage log for each month or keep travel vouchers for the month of January and
average that amount for the remainder of the year." BCC Personnel Policies Section
5.50 further states, " Monthly travel reimbursement or allowance cannot exceed 2,000
miles per month effective December 1, 1996."
(228) According to the minutes of the BCC’s November 12, 1996, meeting, the
current 2,000-mile limitation on in-county travel for Commissioners was a reduction from a
previous limitation of 3,000 miles. Although requested, we were not provided with
documentation evidencing when the BCC had originally established the 3,000-mile
limitation. However, based on the November 12, 1996, minutes, and documentation supporting
travel expenditures, it appears that it was the BCC’s intention to have this
limitation in effect during the period October 1994 through November 1996, at which time
the 2,000-mile limitation went into effect. In October 1997, the BCC approved a revision
to the travel policy whereby Commissioners could choose to be reimbursed for travel based
on a flat rate of $450 per month or actual mileage traveled.
(229) Section 112.061(7)(f), Florida Statutes, authorizes an agency head to grant
monthly travel allowances in fixed amounts for use of privately owned automobiles on
official business in lieu of the mileage reimbursement rate provided in Section
112.061(7)(d)1., Florida Statutes. The allowance is required to be made on the basis of a
signed statement of the traveler, filed before the allowance is granted or changed, and
annually thereafter, showing the places and distances for an average typical month’s
travel on official business. We are not aware of any legal authority, other than Section
112.061(7)(f), Florida Statutes, that empowers the BCC to grant travel allowances to its
members or employees. As such, to the extent that the BCC grants travel allowances to
Commissioners/employees, such allowances are subject to the provisions of Section
112.061(7)(f), Florida Statutes.
(230) The BCC’s travel policy is not consistent with Section 112.061(7)(f),
Florida Statutes, in that it provides for the establishment of a travel allowance based on
travel in a particular month, January, without regard to whether January represents a
typical month’s travel for each traveler. We were not presented with documentation
demonstrating that January travel was determined to be typical for each traveler.
Furthermore, the revision of the travel policy to include a flat rate reimbursement of
$450 per month in lieu of actual mileage is contrary to the typical month’s travel
documentation requirement in Section 112.061(7)(f), Florida Statutes.
(231) Our detailed examination of Commissioners’ travel expenses (see paragraph
242) disclosed that travel vouchers submitted by Commissioners in support of travel
expenses generally were not prepared in a manner sufficient to demonstrate an average
typical month’s travel, as contemplated by Section 112.061(7)(f), Florida Statutes.
In most instances, travel vouchers were accompanied by a cover sheet indicating that they
were considered by the traveler to be a travel allowance. We also noted that most of the
travel vouchers showed mileage in an amount equal to or greater than the BCC established
in-county travel limitation. The County Attorney, in correspondence, dated October 22,
1998, stated that the in-county travel limit was not considered a travel allowance.
Although requested, he did not provide supporting documentation for that determination.
Based on the documentation submitted by Commissioners/employees in support of travel
expenses, it appears that most of the Commissioners/employees considered the BCC’s
establishment of the in-county travel limit as having the same effect as a travel
allowance and were under the impression that they were entitled to at least the amount of
miles established by the in-county travel limitation.
(232) For the reasons discussed above, it was unclear as to what extent payments to
Commissioners/employees for in-county travel represented travel allowances; however,
pursuant to United States Treasury Regulation 1.62-2, to the extent that such payments
were mileage allowances, they may have been subject to withholding for payment of Federal
income tax and other employment taxes. However, none of the payments to
Commissioners/employees included in our examination were subjected to the required
withholding.
(233) We recommend that the BCC, if it is the BCC’s intention to provide for a
travel allowance, revise its written policies and procedures as appropriate to be
consistent with Section 112.061(7)(f), Florida Statutes. The BCC should ensure that any
such allowances are subjected to withholding for payment of Federal income tax and other
employment taxes, as appropriate, and should contact the Internal Revenue Service to
determine whether any corrective actions should be taken regarding travel allowances paid
to date.
(234) The BCC’s written travel policies do not address under what circumstances
Commissioner travel is necessary. Additionally, documentation supporting travel expenses
did not, in several instances, demonstrate the reasonableness of in-county mileage claimed
by Commissioners and employees.
(235) During the period October 1994 through June 1998, Commissioners and employees
were reimbursed for a significant amount of in-county travel. As shown in the following
tabulation, in-county travel mileage claimed by Commissioners and employees significantly
decreased after November 1996, when the BCC lowered the limit on in-county mileage from
3,000 to 2,000 miles per month:
Commissioner/Employee
10/94 - 11/96 12/96 - 6/98
Michael Barker, Former Director of Public Safety 3, 099 1,360
Ronnie E. Bell, Administrative Supervisor 3,050 (4)
Van Ness R. Butler, Jr. , District 5 Commissioner (2) 1,198
Rosier Cuchens, Jr. , Former District 5 Commissioner 3, 711 (2)
Charles Harris, Former District 1 Commissioner 3, 203 (2)
Charles R. Hudson, Director of Public Works 3, 093 2,161
Randall Infinger, District 3 Commissioner (2) (3)
Johnnie Moore, Former District 3 Commissioner 2, 979 (2)
Joel F. Paul, Jr. , District 1 Commissioner (2) 791
J. Gordon Porter, District 4 Commissioner 3, 118 1,819
Sam Pridgen, Former District 2 Commissioner 3, 041 (2)
Virginia Pridgen, Former District 2 Commissioner (3) (2)
Gerald Wilkerson, Former District 3 Commissioner 2, 805 (2)
William A. Young, District 2 Commissioner (2) (3)
Notes: (1) Commissioner did not serve for at least one full month during this time
period.
(2) Commissioner did not claim any in-county mileage during this time period.
(3) Employee was assigned a County-owned vehicle for in-county travel during this
time period.
(4) Average Monthly In-County
Miles Traveled (1) Average monthly miles traveled in the months for which travel was
claimed.
(236) Many Commissioners, on their travel vouchers, reported numerous itemized
instances of mileage traveled but did not indicate the specific
date(s) of the travel (see
deficiency type C on Exhibit B). We could not, in such instances, conclusively determine
whether the itemized mileage reported was for only one day or for multiple days. However,
two Commissioners reported an average of 63 and 65 itemized instances per month,
respectively, while another Commissioner reported an average of 28 itemized instances per
month. As such, each itemized instance for these Commissioners appears to represent a
single or partial days travel. We also noted numerous instances for the period October
1994 through June 1998, as summarized in the following tabulation, in which the itemized
in-county mileage claimed by a Commissioner exceeded the total road miles for the
Commissioner’s district:
These instances in which Commissioners claimed mileage in
excess of the total road mileage for the district raises questions as to the validity of
the mileage claimed by the Commissioners.
(237) We inquired as to the necessity for the amount of in-county travel incurred by
Commissioners. Only one commissioner responded to our inquiry. That Commissioner indicated
that the mileage he claimed was only for the purpose of performing his assigned duties and
responsibilities as a County Commissioner. He described his duties and responsibilities,
several of which were related to road inspection and maintenance. He further stated that
many of those " duties and responsibilities could be avoided or eliminated if
Commissioners were removed from supervising individual Road Districts. However, at this
time that has not been the wishes of the Board of Commissioners. I am pushing for
Centralization, but have had significant resistance from some of the other Board
members."
(238) Each of the five districts in Walton County is assigned a road foreman. According
to their written position descriptions, road foremen responsibilities include overseeing
the maintenance of County roads, bridges, and drainage structures; regularly examining
conditions of roads; determining where pipe, bridges, rock, asphalt, etc., are needed;
monitoring daily road construction and maintenance projects and activities; and evaluating
and supervising bridge discrepancies, planning, repair, and construction. Each foreman was
assigned a County vehicle to carry out his responsibilities, which required an extensive
amount of travel. The above-noted Commissioner, regarding the necessity of Commissioner
travel for road inspection purposes, stated, " Work has not been performed, in some
instances, in a timely manner. Illegal or questionable work has also been performed that
ultimately is the responsibility of the Commissioner. To ensure that taxpayer money
is being spent wisely and according to Florida Statute, the Commissioner must perform quality
control inspections of the work areas." While we acknowledge that there are
circumstances requiring Commissioner travel, such as those described by the Commissioner,
and that occasional inspections of road and bridge conditions by a Commissioner may be
necessary, frequent road and bridge inspections by Commissioners could be a duplication of
effort. Because the travel vouchers submitted by Commissioners generally did not
adequately document the purpose of their travel (see paragraph 242) and the BCC’s
written travel policies did not address under what circumstances Commissioner travel is
necessary, it was not apparent as to why it was necessary for some Commissioners to incur
the extensive amounts of in-county travel reported on the travel vouchers we examined.
(239) In addition to the lack of demonstrated need for extensive Commissioner travel,
we determined that the mileage claimed by Commissioners and employees did not appear to be
reasonable as follows:
· In many instances, Commissioners did not indicate the place of
departure/destination. Consequently, we could not, in such instances, determine whether
the itemized mileage reported was allowable. However, in several instances in which
Commissioners did provide sufficient information as to place of departure/destination, we
noted that the mileage claimed was well in excess of that allowable based on the Walton
County road mileage map. Although we realize that mileage calculated from this map may
vary slightly from mileage actually traveled, the instances we noted were significantly in
excess of allowable mileage based on the map.
· During the 1996-97 fiscal year, the BCC’s Administrative Supervisor was
assigned a County-owned vehicle for in-county travel. According to vehicle usage logs
showing mileage for this vehicle (available beginning in July 1997), this vehicle was
driven a total of 11,569 miles during the one-year period July 14, 1997, through July 13,
1998. In comparison, the Administrative Supervisor, on his travel vouchers filed for the
1995-96 fiscal year, claimed a total of 36,952 miles of in-county travel. We inquired as
to why mileage claimed by the Administrative Supervisor during the 1995-96 fiscal
year significantly exceeded mileage traveled while using the County-owned vehicle.
In a letter dated September 29, 1998, the BCC’s Administrative Supervisor indicated
that since four new Commissioners took office in November 1996, his responsibilities have
changed from having to respond to the needs of the public to being an administrator
overseeing the various departments. He also cited the establishment of the South Walton
Annex and a Code Enforcement Officer as reducing the need for travel. In the absence of
documentation as to the purpose for the travel, we could not evaluate the extent of travel
necessarily incurred prior to, and after, the dates of these events.
· Our examination of travel vouchers submitted by the former Director of Public Safety
disclosed that for several months, the itemized destinations and mileage for a month were
the same as the previous month, except they had been presented in a different order. This
was noted for the former Director’s travel vouchers submitted for the period October
1994 through February 1997. Our findings are consistent with the findings of a Florida
Department of Law Enforcement Investigative Summary report dated April 18, 1996. According
to that report, the ex-secretary of the former Director of Public Safety stated that, in
response to her inquiry as to how to complete his travel vouchers, the former Director had
advised her to pull a previous travel voucher and use the same destinations but to list
them in a different order. According to the report, he further advised her that the miles
had to total at least 3,000 miles.
· Our examination of travel vouchers submitted by the former District 3 Commissioner
Gerald Wilkerson disclosed that, with respect to itemized points of departure and return
and mileage, they were virtually identical to those filed by his predecessor commissioner,
except that they were presented in a different order. Although requested, we were not
provided with an explanation as to why points of departure and return and mileage claimed
by the former District 3 Commissioner were virtually identical to those filed by his
predecessor Commissioner, which raises a question as to the validity of mileage claimed by
the former District 3 Commissioner.
(240) As previously discussed in paragraph 228, the BCC, in November 1996, lowered the
limit on in-county mileage from 3,000 miles to 2,000 miles per month. In response to our
inquiry regarding the decrease in mileage claimed by Commissioners and employees after the
November 1996 in-county mileage limitation reduction, the County Attorney stated in
correspondence dated October 22, 1998, " One obvious reason for the reduced mileage
might be that County services were curtailed because travel expenses incurred were not
reimbursed." The County Attorney did not specifically identify any reductions in
County services provided. We believe that the extent of travel allowed should be based on
the need for County services, as documented in the County’s records, rather than the
arbitrary establishment of a travel limitation. We recommend that the BCC amend its travel
policy to clarify under what conditions Commissioner and employee travel is necessary and
give consideration to lowering or eliminating the current 2,000 mile in-county travel
limit.
Unauthorized/Unsupported Travel Expenses
(241) The County’s records relating to travel expenses generally were not adequate
to demonstrate the authorized public purpose served and/or compliance with State law.
(242) Pursuant to Section 112.061(3)(b), Florida Statutes, County Commissioner/employee
travel expenses are limited to those expenses necessarily incurred by them in the
performance of a public purpose authorized by law to be performed by the County and must
be within the limitations prescribed by that Section. Our detailed examination of
$219,533.61 of travel expenses incurred by Commissioners, or by the BCC’s
Administrative Supervisor, Director of Public Safety, and Director of Public Works, during
the period October 1994 through June 1998 (450 transactions), including the payments for
in-county travel discussed in paragraphs 235 through 240, disclosed that the majority of
these expenses were inadequately supported and/or not in accordance with State law as
follows (detailed listings of unauthorized or inadequately supported expenses are included
in this report as Exhibit B):
· Supporting documentation for travel expenses generally did not indicate how the
expense served a public purpose and/or how the expense benefited the County. In 239
instances included on Exhibit B, supporting documentation either did not indicate the
purpose for the expense or, if the purpose was stated, did not specifically indicate how
the expense benefited the BCC and was necessary in carrying out the BCC’s duties as
prescribed by law (see deficiency type A). Also, in 9 instances included on Exhibit B,
documentation evidencing that incidental expenses claimed by the traveler were incurred
(e.g., receipts, bills, invoices) was not available (see deficiency type D).
· In numerous instances, convention and conference registration fees and related
lodging and meal expenses were paid; however, convention or conference agendas were not
submitted with the applicable travel expense reports. In the absence of convention and
conference agendas we could not, in these instances, verify compliance with Section
112.061(6)(c), Florida Statutes, which provides that no traveler shall be reimbursed for
any meal or lodging included in a convention or conference registration fee. However, we
did note that in 7 instances included on Exhibit B (see unauthorized expense type 4), the
traveler was paid a meal allowance to which the traveler was not entitled because meals
were included in the conference or convention registration fee.
· Contrary to Section 112.061(3), Florida Statutes, and BCC Personnel Policies Section
5.50, supporting documentation was not approved by the traveler’s supervisor in 97
instances included on Exhibit B (see deficiency type B).
· Section 112.061(7)(d)1., Florida Statutes, establishes the fixed rate travelers
shall be allowed to claim for mileage traveled using a privately owned vehicle. In 139
instances included on Exhibit B, amounts paid for mileage traveled by privately owned
vehicle were in excess of the amounts allowed by Section 112.061(7)(d)1., Florida
Statutes, or BCC policy (see unauthorized expense type 1).
· Section 112.061(7)(d)2., Florida Statutes, requires that all mileage, when possible,
be computed on the basis of the current Florida Department of Transportation
(FDOT) map.
In 118 instances included on Exhibit B, mileage claimed by the traveler was in excess of
that allowed based on the FDOT map (see unauthorized expense type 3). In addition, in 51
instances on Exhibit B (see unauthorized expense type 5), a Commissioner was reimbursed
for in-county mileage from the traveler’s home to the BCC’s official
headquarters located in DeFuniak Springs. The Attorney General has opined that
reimbursement for such mileage is not allowable (see Attorney General Opinion No. 83-37).
· Section 112.061(6), Florida Statutes, establishes the amounts travelers are allowed
for meal allowances or per diem while on official business. There were 135 instances
included on Exhibit B, in which amounts paid to travelers for meal allowances or per diem
were in excess of amounts allowed by Section 112.061(6), Florida Statutes (see
unauthorized expense type 2).
· In 3 instances included on Exhibit B, expenses were for items such as telephone
calls or parking tickets (see unauthorized expense type 6). It was not apparent from the
BCC’s records how these expenditures were necessarily incurred in the performance of
a public purpose.
(243) Our detailed examination of $7,245.52 of travel-related credit card charges for
the period October 1996 through March 1998 (46 transactions) disclosed four charges
totaling $127.06 for which supporting documentation did not clearly evidence that the
expense was reasonable and necessary and served a public purpose. In three of these
instances, the expenses were for telephone calls for which it was not apparent, of record,
how the expense was necessarily incurred in the performance of a public purpose. In the
other instance, a Commissioner did not cancel a room reservation timely for a canceled
trip and the room deposit was charged to the County’s expense.
(244) Pursuant to law and BCC policies, adequate documentation for travel expenses
should include explanations evidencing the necessary and authorized public purpose served
by the expense and sufficient details of travel to permit a determination that
reimbursements were made in accordance with applicable laws. The use of a properly
designed travel voucher can be an effective means of accumulating details of travel
necessary to demonstrate compliance with applicable law and BCC policies. However, as
discussed above, travel voucher forms did not, in many instances, include sufficient
details of the travel necessary to demonstrate how the expenses benefited the BCC and were
necessary in carrying out the BCC’s duties as prescribed by law. Also, travel
expenses charged to a credit card were not, in many instances, recorded on a travel
voucher.
(245) As previously noted, the Clerk has a constitutional and statutory responsibility
for pre-auditing the BCC’s expenditures. We recommend that, in the future, the Clerk
require Commissioners/employees to provide adequate supporting documentation (including
properly completed travel vouchers) for any claims of travel expenses which clearly
evidences the necessary and authorized public purpose served. We also recommend that the
BCC and the Clerk review the questioned travel expenses disclosed by our audit, determine
the extent of unauthorized amounts paid to Commissioners/employees for such travel
expenses, and consult with the BCC’s attorney regarding procedures to recover amounts
not authorized by Section 112.061, Florida Statutes, including $5,760.63 and $127.06 of
unauthorized expenses as identified on Exhibit B and in paragraph 243, respectively.
(246) In February 1997, a former Commissioner wrote a check to the BCC for $7,239.56 to
return amounts previously paid by the BCC to the former Commissioner for in-county travel.
However, the check was never deposited and, subsequently, the former Commissioner’s
bank account, from which the check was written, was closed. The BCC has since been
unsuccessful in its efforts to recover this amount from the former Commissioner.
(247) In February 1997, former District 3 Commissioner Gerald Wilkerson wrote a check
to the BCC for $7,239.56 to return amounts previously paid by the BCC to the former
Commissioner for in-county travel. The Clerk never deposited the check and, subsequently,
the former Commissioner’s bank account, from which the check was written, was closed.
In a letter dated July 28, 1998, the BCC’s attorney requested that the former
Commissioner forward the $7,239.56 to the BCC as soon as possible. In a letter dated
August 4, 1998, an attorney representing the former Commissioner stated, " Based on
the investigative report of the ethics commission and their subsequent finding of no
probable cause, and the county’s inexplicable delay in refusing to cash his personal
check, Mr. Wilkerson has taken the position that he will retain the travel expense money
he was entitled under the county’s unwritten policy of reimbursement of travel
expenses." As shown on Exhibit B, payments to the former Commissioner totaling
$7,228.56 were not supported by adequate documentation evidencing that he was entitled to
reimbursement for such travel expenses. We recommend that the BCC and the Clerk continue
their efforts to recover any amounts determined to have been unauthorized.
Taxable Meal Allowances
(248) Contrary to Federal regulations, payments for nondeductible travel expenses
(Class C meal allowances) were not reported as wages or other compensation and were not
subjected to withholding for payment of Federal income tax and other employment taxes.
(249) Internal Revenue Code Section 162(a)(2) provides that there shall be allowed as a
deduction all the necessary expenses paid or incurred during the taxable year in carrying
on any trade or business, including traveling expenses while " away from home."
The United States Supreme Court has interpreted the " away from home"
requirement as requiring that the taxpayer be away from home overnight or at least long
enough to require rest or sleep. Class C travel, as defined in Section 112.061(2), Florida
Statutes, does not involve travel away from home overnight and, therefore, Class C meal
allowances are not considered to be deductible traveling.-115- expenses. United States
Treasury Regulation Section 1.62-2 provides that reimbursements for nondeductible
traveling expenses must be reported as wages or other compensation on the employee’s
Form W-2 and are subject to withholding and payment of employment taxes.
(250) Our examination of Commissioner and employee travel expenses during the period
October 1994 through June 1998 (see paragraph 242) disclosed that nondeductible Class C
meal allowances totaling $495 were not reported as wages or other compensation and were
not subjected to withholding for payment of Federal income tax and other employment taxes.
It was not practical on post-audit to determine the amount of Class C payments processed
by the County for travelers other than those Commissioners/employees included in our
examination during this period. The County Attorney stated in correspondence dated October
22, 1998, that deductions are now made for Class C travel.
(251) We recommend that the Clerk and the BCC contact the Internal Revenue Service to
determine what corrective action should be taken regarding the unreported amounts.
Communications Expenses
(252) There was no documentation evidencing an independent review of telephone billings
and compliance with BCC policy regarding prior approval of calls subject to reimbursement
by employees was not documented. In the absence of such documentation, the BCC and the
Clerk could not be assured that the calls served an authorized public purpose.
(253) The BCC and the Clerk reported communications expenditures totaling $426,399 for
the period October 1996 through June 1998, including $45,876 for cellular telephones. The
BCC Personnel Policies Section 6.41 provides that telephones are to be used for
County business and emergency personal use only; personal use of telephones for
nonemergency purposes is prohibited; and no personal long-distance telephone calls shall
be charged to the County for employee reimbursement, unless prior approval has been
granted by a department head. Chapter V of the Clerk’s Policies and Procedures
Manual established June 5, 1998, governs telephone usage by Clerk employees.
(254) Our review of internal controls established for BCC and Clerk telephone charges
disclosed that there was no independent review of telephone bills to determine the extent
of personal telephone calls made by Commissioners/employees. Instead, an " honor
system" was in effect, whereby the Commissioners/employees making such calls were
responsible for identifying and.-116- reimbursing the BCC for any personal calls. Our test
of 20 BCC cellular telephone bills totaling $2,463.76 for the period October 1996 through
April 1998 disclosed that 9 of the bills included personal calls identified as subject to
reimbursement by the employees that made the calls. Reimbursements were made for calls
identified by the employees as personal; however, although required by BCC Personnel
Policies Section 6.41, there was no documentation of prior supervisory approval for
such calls.
(255) Although our review of telephone expenditures was limited to Commissioners and
BCC employees, we noted that the Clerk, in a letter dated June 8, 1998, notified the State
Attorney’s Office that he had become aware of the possibility that a former Clerk
employee had used the Walton County telephone system to place numerous personal
long-distance telephone calls during his employment. The letter indicates that the Clerk
requested that the State Attorney’s Office conduct a full investigation. The State
Attorney’s Office, in a letter to the Clerk dated September 11, 1998, stated that the
Walton County Grand Jury had voted to take no further action regarding the matter because
it was an administrative matter that should be handled by appropriate supervisory
personnel, including reimbursement for any personal long-distance charges. In October
1998, the former employee reimbursed the Clerk $159.21.
(256) In the absence of adequate controls over cellular and other telephone usage, the
BCC and the Clerk could not be assured that the telephone calls served an authorized
public purpose. We recommend that the BCC and the Clerk implement a procedure whereby an
individual, other than the Commissioner or employee placing the calls, reviews telephone
billings to ensure that all calls made serve a public purpose.
(257) In some instances, the BCC had not demonstrated of record the need for assigning
cellular and digital radio telephones to Commissioners and employees.
(258) As of August 1998, 25 cellular telephones were assigned to Commissioners and BCC
or Clerk employees. The cost of each cellular telephone is $24.95 per month plus 11 cents
per minute of airtime, or about $300 per year per cellular telephone plus airtime. Our
review of Commissioners’ usage of cellular telephones as shown on telephone billings
for two months during the 1997-98 fiscal year disclosed that three Commissioners used the
cellular telephones extensively (between 444 and 1,409 minutes) and two other
Commissioners used the cellular telephones infrequently (between 32 and 37 minutes). Based
on the frequency of calls made by Commissioners during the two months included in our
review, the estimated annual cost of providing cellular telephones to Commissioners is
$3,200.
(259) In March 1998, several Commissioners and employees assigned cellular telephones
were also provided with digital radios (costing $404 each) that are being used to provide
telephone service for a $25 per month fee. This was necessary because the cellular
telephones were not working properly in certain parts of the County. Several of these
Commissioners/employees are no longer using a cellular telephone; however, as of September
1998, one Commissioner and four employees were assigned both a cellular and digital radio
telephone. In response to our inquiry, the BCC’s Administrative Supervisor indicated
that this was necessary because of some problems with the digital radio telephones.
(260) We recommend that the BCC review the assignment and use of all cellular and
digital radio telephones for BCC and Clerk personnel and determine whether utilization of
the telephones for county purposes justifies their continued assignment to Commissioners
and employees.
(261) Our audit disclosed that the BCC and the Clerk paid certain Federal, State, and
local telecommunication taxes from which they are exempt. Based on the applicable tax
rates and reported communication expenditures, the BCC and/or the Clerk paid as much as
$11,000 of exempt telecommunication taxes during the period October 1996 through March
1998.
(262) Customers of vendors that provide telephone services are normally subjected to
specified telecommunication Federal, State, and local sales or excise taxes. However,
governmental entities are exempt from certain of these Federal, State, and local taxes.
Pursuant to Internal Revenue Code Section 4253(i), the County is exempt from Federal taxes
on telephone services. Similarly, the County is exempt from State sales taxes on telephone
bills pursuant to Section 212.08(6), Florida Statutes. In addition, the County may be
exempt from certain local taxes. For example, governments are exempt from the public
service taxes imposed by municipalities pursuant to Section 166.231(5), Florida Statutes.
The BCC and/or the Clerk currently use four different vendors for telephone services and
are billed on a monthly basis.
(263) Our examination of 19 selected telephone billings from these vendors during the
period February through April 1998 disclosed that the BCC and the Clerk paid certain
Federal, State, and local taxes from which they are exempt. It was not practical for us to
determine the exact amount of exempt taxes paid by the BCC and the Clerk; however, based
on the applicable tax rates in effect February through April 1998, we estimate that the
BCC and/or the Clerk paid as much as $11,000 of exempt Federal, State, and local
telecommunication taxes during the period October 1996 through March 1998. We recommend
that the BCC and the Clerk notify these vendors of the County’s exempt status and
attempt to obtain a refund for exempt taxes paid.
