Arkansas audit finds city funds mishandled

CAVE SPRINGS, Ark.-Officials in the northwest Arkansas city of Cave Springs mismanaged taxpayer dollars, overcompensated employees and made purchases above allowed amounts, according to state auditors.
The Arkansas Legislative Audit released a report saying the city failed to meet state law requirements in 22 instances from 2015 to 2016, the Northwest Arkansas Democrat-Gazette reported.
The audit said Cave Springs put more than $61,000 of its street fund in to its general fund in 2016, which violated the law. The audit also found several expenses paid without proper authorization from the City Council, though those weren't cited as a failure to meet legal requirements.
Prosecuting Attorney Nathan Smith said he's reviewing the audit findings.
The report comes as the city faces losing $391,000 out of a $1.7 million general fund budget. City records show it failed to reauthorize its property tax for 2017.
Cave Springs City Attorney Justin Eichmann said city leaders are working to straighten out Cave Springs' finances and plan to meet to go over the audit's findings.
"We have been waiting for this to come and knew it would be bad," Eichmann said of the audit. "It is one of the worst I've ever seen."
Eichmann said most of the problems the report cited involved putting money into the wrong accounts. He said a lot of people in city government have learned on the job, which "played a role in the chaos."