By Anthony Hennen | The Center Square
(The Center Square) – Local municipalities have struggled to accurately estimate required pension payments and payrolls that affect how much state aid they receive, according to recent reports from the auditor general.
In Braddock Hills, a borough just outside of Pittsburgh, a survivor is being overpaid and money is going to a dead beneficiary in the most relevant audit for cost to taxpayers. The pension fund was criticized by the auditor because, “The pension plan is paying a pension benefit to a surviving spouse in excess of the plan’s governing document,” which totaled about $30,000 from 2019 through October 2022.
The auditor found that the plan paid out more than $5,100 to a dead recipient since July 2021.
“Plan officials should consult with its solicitor and determine whether recovery of these payments would be appropriate and/or whether referral to appropriate law enforcement is warranted,” the report noted.
A police pension fund for Ambler, a borough in Montgomery County, also had issues. A failure to include a handful of eligible employees in its payroll in 2020 and 2021, thanks to “an oversight,” meant that the fund was underpaid in its state aid by about $44,000.
With the audit report, the borough will now receive the state aid allocation.
“The borough lacked adequate internal control procedures,” the report noted.
Nor were boroughs and townships the only municipalities singled out for problems.
The auditor’s office also noted the city of Carbondale has failed to fully pay its minimum municipal obligations of its police and firefighter pension funds.
“As disclosed in the prior two audit reports, plan officials did not properly determine or fully pay the minimum municipal obligations (MMOs) of the police pension plan for the years 2015, 2016, and 2019, and of the firemen’s pension plan for the years 2015 and 2016, as required by Act 205,” the report noted.
The issues, as noted by city officials, stemmed from underestimating payroll.
The report noted that the city needs to pay about $47,000 to fully fund the MMO, plus interest.
“In response to these findings the City will review their MMO payroll calculations after submitting the amounts for approval and adjust MMO contributions prior to being made on or before the date paid,” the city noted in its response. “Also, the City will properly review any audits and audit findings with the authority auditing them and make sure all parties understand their responsibility in resolving the same.”
Lackluster accounting practices or weak oversight caused most of the recent issues, big or small. Ferguson Township in Centre County and New Freedom Borough in York County, for example, both received about a $5,000 overpayment in state aid due to inaccurate data reported to the commonwealth.
While those issues remained small, bigger problems in pension funds often followed when municipalities did not address earlier reports from the auditor general.