Before he resigned Wednesday afternoon, March 1, Ulster County finance commissioner Burt Gulnick found himself under a magnifying glass. County comptroller March Gallagher announced an investigation into the accounting practices of Gulnick’s office after disturbing details came to light the day before regarding his job performance as treasurer of the Hurley Recreation Association. Gulnick had been removed after allegations of theft.
“I received multiple phone calls from the community yesterday,” said Gallagher Wednesday evening, “that the Hurley Recreation Association had undertaken an investigation which uncovered potential embezzlement that implicated him. And that is extremely concerning.”
As those allegations related to cash oversight and management, the comptroller immediately began an internal investigation for the county. “My position was that he would need to be put on leave,” said Gallagher, “while we worked it out. But obviously he went a step further, and according to county executive [Jen] Metzger he resigned.”
In her announcement, Gallagher cited a troubling history of roadblocks over multiple administrations which had barred her from auditing county finances. Requests for documentation and for access, she said, had often been left unanswered. Numerous outstanding requests remained for information over one year old. “I have had a very frustrating experience working with him, in the sense that I have asked for information that was either been denied or my access to certain information has been curtailed, repeatedly,” she said.
Gallagher said she circulated a draft audit to management just last week which identified the potential for theft and error in cash collections within the county government, a responsibility of the finance department. Citing specific concerns about the absence of internal controls over cash receipts overseen by Gulnick, the comptroller pointed particularly to the collection of delinquent real-property taxes.
Some of the requested data was made available on Wednesday by county executive Metzger, for which the comptroller has expressed gratitude. “The system that keeps track of which properties are delinquent does not interface with the system we record taxes on,” said Gallagher. “And it seems to us that it would be possible to write off somebody’s taxes without receiving payment, and it would be very hard to uncover. We are striving to get full access to that system.”
The investigation will continue, Ken Juras, director of budget and innovation, has been appointed interim finance commissioner.
Metzger also has provided a statement. “I have directed our staff to work with the county legislature to contract with an outside auditing firm to conduct a rigorous review of the county finances as well as our internal controls. This investigation will be thorough, independent and transparent, and I will do everything in my power to ensure that taxpayer dollars are protected.”
Gallagher expects the work in auditing the county finance department will be an intensive and time-consuming process.
“This is paramount,” says Gallagher. “We’re going to be looking at all cash receipts, checks, all the places that we can work out where money is leaving the county, including wire transfers. There’s some initial testing that’ll take weeks. There’s deeper testing that’ll take months.”
Ken Juras, director of budget and innovation, has been appointed interim finance commissioner.
In August of last year, former confidential secretary to Gulnick Heather Mikesh had aired allegations in court papers contending previous fiscal mismanagement. The county investigated, finding what it said at the time was an erroneous wire transfer to the state Department of Taxation and Finance, but no wrongdoing.
The allegations are presently being investigated by state and local authorities. Gallagher said it was imperative that the county immediately take the appropriate steps to safeguard Ulster County taxpayers’ more than $214 million in cash assets.
The following statement was made by Town of Hurley supervisor Melinda McKnight:
“The Hurley Recreation Association, commonly known as Hurley Rec, is neither operated nor funded by the Town of Hurley. Its name is derived merely from the fact that it is located within the town. Hurley Rec, a swimming and outdoor recreation park at 50 DeWitt Mills Road, is a nonprofit organization funded by members’ dues and guest fees, and is managed by a board of directors.”
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