SALT LAKE CITY — A new state audit found that the Utah Dairy Commission misused credit cards, including a $180 manicure for its CEO, and doesn't get that it runs on public money.
In a written response, the dairy commission questioned the power of the state auditor's office to look at its books, and said the financial review contained "multitudinous" errors and reflects a general misunderstanding of what the agency is and does.
"It's inappropriate for them to question my authority when it comes to public entities and public funds, and I have no patience for that," said State Auditor John Dougall. He said the commission needs to recognize the use of public money carries certain duties and it's time for it to "stop operating in the shadows, away from public scrutiny."
"My hope is that the dairy commission wakes up and recognizes the error of their ways and starts to correct and become more accountable and also to fix the weaknesses in their organization," Dougall said.
Utah Dairy Commission CEO Jenn Harrison, who was out of state on Wednesday, did not immediately return a message left on her cellphone.
Wednesday's audit was the second in the past two months to ding the commission. In July, state auditors found it routinely violates Utah's open meetings law and held a third of its 2015 public meetings outside the state, including one in Florida.
In addition to the dairy commission, state auditors also discovered problems with credit cards at the Utah State Fair Corporation, Heber Valley Historic Railroad and the Military Installation Development Authority in separate reports.
All four lack sufficient oversight, written policies and training for credit card use, according to the audit. The report also revealed several questionable expenditures.
The Utah Legislature created the dairy commission, which refers to itself as the Dairy Council of Utah/Nevada, to promote local agriculture. It is funded by a tax on milk and cream produced and sold in Utah.
Dougall said the commission is exempt from more laws and regulations than most all state entities, but being subject to state audits and the open meetings act are not among them.
Auditors found the commission had 122 credit card charges totaling $9,213 for which there were either no original receipts or no itemized receipts. There were 25 charges at restaurants, including five at Starbucks that appeared to be personal, totaling $2,500 without documentation for the purpose of the meal or who attended.
Other expenses include airline upgrades, cash advances, a Utah State University annual AG Day barbecue and football, and $180 manicure for Harrison.
A receipt showed Harrison had reimbursed the commission, but auditors said they couldn't trace the money to the commission’s bank because it was apparently returned to a petty cash fund.
In the written response to the audit, Harrison and commission chairman Jeff Hardy wrote that the report reflects a "gross" misunderstanding, even after explanation, of the items auditors questioned. They also essentially told the auditor's office how to do its job.
"We encourage the Utah State Auditor's Office to better understand what UDC's goals and missions are, engage in more dialog to obtain answers for questions that may arise, which in turn, would enable its staff to better implement their job when conducting audits," they wrote.
Dougall said the commission threw up roadblocks to the audit, forcing him to issue a subpoena at one point. He said the agency will be on his radar and that he might suggest legislative remedies if it doesn't comply with the audit findings.
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