City employees kept a cash fund for parties and gifts with money that should have gone into city's budgets and accounts, officials confirmed.
Troy Mayor Allen Adomite said he recently became aware that the Public Works Department had a long-standing practice of recycling scrap metal and keeping the money as petty cash rather than turning it over to the city treasurer.
The total amount that could be documented over the past seven years came to nearly $33,000, Adomite said. However, the practice has been going on for as long as 20 years.
"Tens of thousands of dollars from earlier dates will likely never be completely reconciled," Adomite said in the open letter. "This is an embarrassing fact for which I can only apologize to you on behalf of the city and its employees."
Adomite said he turned the issue over to the Madison County Sheriff's Department with the blessing of Troy Police Chief Brad Parsons.
"We felt it was important for an outside agency to get the first look at the details, and the Sheriff's Department conducted an investigation and ultimately informed us that no employees personally profited from the fund."
Adomite said the Troy municipal code requires monthly deposits of all funds derived from city activities. Likewise, state law requires the sale of all surplus municipal property to be approved by a majority of the mayor and City Council.
"It is important for our cash management, and it is important for transparency," Adomite said. "(The funds) should have been available to the inspection of the City Council and the city administrator, as well as the public."
Adomite disclosed the issue at a recent City Council meeting, followed by an open letter to the public. "I felt the need to engage the whole community," he said.
The recycled material came from the city's old water meters, pipes, defunct equipment and other assorted scrap metals.
According to Adomite, the money gained from its recycling was used for miscellaneous purposes such as work boots and equipment used on the job, but also for extraneous expenses like retirement parties and funeral flowers.
Madison County Sheriff Bob Hertz said that bringing in his department for an impartial investigation was "the right move." He declined to say whether there was any wrongdoing, saying it was up to county prosecutors to make that determination.
However, Madison County State's Attorney Tom Gibbons confirmed that the initial investigation has determined no criminal laws were broken.
"I applaud Mayor Adomite for his open and transparent approach to dealing with this situation and his determination to have the city of Troy operating with the best available practices under the law," he said.
Adomite said there will be a complete in-house investigation and potential discipline of employees, as well as retraining in proper bookkeeping procedures.
"We respect the confidence you put in (city services)," Adomite said in his letter to the public. "I never want us to take that support for granted. We are working harder than ever to be an open and transparent operation."