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Auditors hit Port on pay raise procedure

July 6, 2012

EAST LIVERPOOL - The state has recommended the Columbiana County Port Authority run employee pay raises through its meeting after it failed to do so in 2011.

A routine audit of port authority books by the Ohio Auditor's Office discovered the board granted employee pay raises last year without bringing the issue up for a vote at a meeting. The auditors discovered there was no mention of the raises in the board meeting minutes, nor could they find any board-adopted resolution approving the raises.

The auditors recommended any raises, whether for employees or board members, be approved at a board meeting.

"All increases in salary, whether to employees or board members, should be approved and noted in the minutes or by a resolution," they concluded.

Port Authority CEO Tracy Drake said the 3 percent pay raises were granted to his three staff employees only and not to himself or board members, adding they have granted past pay raises without running them through an open board meeting.

"We'll probably comply with the recommendation, but this is the first we've ever seen this," he said.

Drake indicated he never brought the raises up for a vote because he does not consider the money they work with public money since the Port Authority generates its own revenue for daily operations. The Port Authority does receive tax dollars in the form of state and federal grants and loans to fund projects, and the organization is considered a government agency under Ohio law, which is why they are subject to annual state audits.

"This is how we've done it since I've been here," he said of pay raises. "It never occurred to me this was something we had to run through a meeting."

The recommendation was the only significant finding in the audit, but the Port Authority was cited again for failing to make any payments on a state loan obtained in the 2000s to rehabilitate a railroad they have been trying to sell. The Port Authority was cited by auditors for the same reasons in 2009 and 2010, but the state agency that loaned the money has since agreed to modify the terms.

The Port Authority has a buyer for the railroad and is expected to close on the sale at its July 16 meeting.



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