Winter Springs passes anti-fraud policy in response to state audit

Winter Springs passed a new anti-fraud policy at Monday’s City Commission meeting in response to an audit of how it spent a one-cent sales tax. 

Under the new policy, all city employees, police officers and volunteers must report suspected fraud to the city manager. The original fraud policy said employees “should” report suspected fraud. Deputy Mayor Rob Elliott asked for the wording in the new fraud policy to be strengthened. Ultimately, the City Commission approved the stronger wording. 

“If an employee fails to report [fraud], are there any ramifications?” Elliott asked. “We can change ‘should’ to ‘shall.’ That would be my suggestion.”

The new policy is in response to a state audit launched, in part, concerning whether the City of Winter Springs misspent tax money from a one-cent sales tax. Citizens complained after roads washed out when Hurricane Ian dumped 15 inches of rain on Seminole County in 24 hours. A Seminole County audit, released this past spring, also analyzed the city’s sales tax spending.

Two draft audits were released before the city had a chance to fully respond to them. The city responded to the audits this week. Find the full report at the bottom of this article.

The draft reports said the city was in compliance with state law, but that the city didn’t follow the intent of the one-cent sales tax by using money for things such as police cars and other city staff vehicles. 

The new anti-fraud policy requires the city manager to investigate allegations of fraud. “If any potentially prosecutable criminal activity exists, the Winter Springs Police Department or other applicable law enforcement agency or agencies will conduct the investigation,” the policy reads. 

The policy also warns that anyone intentionally filing a false claim, “may be subject to civil or criminal penalties.”

A draft audit became publicly available last month. In an interview with WKMG in September, Winter Springs Mayor Kevin McCann defended the city, saying the audit was a draft and that the city would reply at the proper time. That reply to the audit came Wednesday, signed by McCann and Interim City Manager Phil Hursh.

At Monday’s meeting, McCann said he has faith in city employees. 

“I have full faith in our city staff, and if someone is committing fraud, they would be turned in rather quickly,” McCann said. “I trust the city staff.”

Art Gallo, a retired resident of Winter Springs who attended Monday’s meeting, said he agrees with the mayor that in the long run, the city will be better because of the audits. But he questioned the motives of some of the people who have come to meetings. 

“I don’t see anything really damning in the audit reports,” Gallo said. “There’s no ‘there’ there. But if people only get their news from social media…”

The fraud policy was added as part of Monday’s consent agenda. According to the draft audit, the city often looks at important business as part of the consent agenda, where action takes place without public discussion. 

City Commissioner Cade Resnick said he didn’t like that.

“They were also concerned that we put a lot of things on consent,” Resnick said. “Are we doing the right thing?” he asked.

Audit response released

Winter Springs today responded to the findings in the audit draft sent to the city by the State of Florida on Sept. 19. It’s the second audit the city has had to respond to this year, following one by Seminole County. Below is the response document signed by Mayor Kevin McCann and Interim City Manager Phil Hursh.