Knox County Commissioners will hold a special called meeting May 19 to discuss what, if any, actions should be taken against Mayor Mike Ragsdale’s Office for misuse of county issued purchasing cards.

Purchasing cards are countywide commercial charge cards available to Knox County offices and employees to purchase goods and services for the county. The intent of a P-card is to speed up processing of low dollar purchases.

However, misuse of a P-card can be similar to litter. One cigarette butt may not look so bad lying on the sidewalk. But 39,115 cigarette butts on the sidewalk would be offensive to even the most hardcore smoker.

That’s exactly how much county audit staffers say was innappropriately used by County Mayor Mike Ragsdale and members
of his staff: $39,115.

Of that amount, roughly $9,600 was improperly documented, while the remaining $29,544 had no receipt documents at all.
P-card policies require that each department retain detailed documentation for all charges made by that department’s employees. The employee must attach receipts for all charges and sign the statement “validating the accuracy.” The statement and receipts must be reviewed by a supervisor who must sign as well.

Chief County Auditor Richard Walls wrote in the audit report, “Our examination of documentation on file with individual departments indicated the following instances of noncompliance with the above documentation requirements of the policies and procedures:”

•2 instances of missing receipts.
•5 instances of missing statements.
•49 instances of statements not signed by employee.
•120 instances of statements not signed by supervisor/department head.
•4 instances of summary sheet not attached.
•34 instances of summary sheet not attached by department head.
•21 instances of summary sheet not signed by department representative.

Walls said that 376 transactions were missing receipts.

Walls wrote, “Despite the supporting documentation provided for the purchasing card transactions, questions still remain regarding the legitimate business purpose of many of those transactions.”

Since the initiation of auto/travel and P-card audits last year, Mayor Ragsdale has tightened spending policies, established penalties for policy violations and revoked most of the P-cards. Transactions are also monitored more closely.

The audit outlines $188,747 in charges made by Ragsdale and six members of his staff.

Major portions of that amount stem from lodging ($49,735) and meals (55,519).

The audit report includes the auditors’ findings and recommendations, as well as comments from the mayor’s office and in some instances a rebuttal from auditors.

Ragsdale agreed with auditors in some recommendations, while some others have already been addressed through policy changes.

One item pertaining to meals that has some members of the public concerned is the purchase of alcoholic beverages using taxpayer dollars.

While the travel policy does prohibit buying alcohol as part of travel expenditures, questions remain about purchasing alcohol in other settings.

In response, Ragsdale said, “Currently, the procurement card guidelines are silent on the subject of the purchase of alcoholic beverages in a business setting. Management notes that in previous instances where reimbursements have been made... this was done in deference to public sentiment and not as a result of any prevailing policy or guideline.”

Walls cited the Knox County Travel Policy Handbook in his rebuttal, which states, “Charges for alcoholic beverages will not be allowed in any circumstance.”

Exhibit 12 of the audit report indicates that $5,846 was spent on alcohol by Ragsdale and at least three of his staff. This amount represents 11 percent of the total amount spent on meals by Ragsdale and the six staff members, or former staff members in question. Of the expenditures made on P-cards, legitimate and questionable, only 3 percent was for alcoholic beverages.