Octogenarian Incumbents Combat for Survival on Flagler Mosquito Management Board Following Troubled Time period

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Franklin Delano Roosevelt was still in his first term when Jules Kwiatkowski was born. So was Barbara Sgroi. He’s 85. She’s 83. They’re the senior-most elected officials in Flagler County, older by a few years than their next-oldest competitor, Bunnell City Commissioner Bill Baxley. They sit on the East Flagler Mosquito Control District board.

Kwiatkowski and Sgroi are both running for re-election for one of the least-known offices in the county. The mosquito district is a three-seat elected board with control over a $2.2 million budget and one mission: to massacre mosquitos in Palm Coast, Bunnell and the barrier island. Most Flagler County taxpayers pay a share of their property taxes to the district, albeit a very small one. The typical home valued at $175,000 and homesteaded at $50,000 pays about $30 a year. Still, it’s not a negligible agency. Its mission is central to the quality of life of local residents. Its responsibility to run a financially sound and environmentally safe operation requires oversight and transparency.

The agency was in crisis in 2017  when it overspent on building a new headquarters at the south end of the Flagler County Airport, was suddenly faced with a $1.1 million hole, required a retrenchment in its workforce, required a manpower bailout from the county administration, which sent its own finance hands to help, drew a state audit, and caused its long-time director, Joe Cash, abruptly to retire in that summer after some 39 years on the job.

Nevertheless, the board papered over scandal and hole by determining that it was mostly an accounting error, though the accounting error did not account for the job cuts, the county bailout or the overspending on the new building. The audit did not find malfeasance but did find a long list of irregularities.

After Cash’s retirement, the job went to Mark Positano, a sharp-eyed manager whose tenure has been quieter. The three-member elected board has been down to two members since February 2019, with just Sgroi and Kwiatkowski, who are not as sharp-eyed as their director, and generally not assertive or questioning: in meetings surrounding the financial breakdown and shortly thereafter, they moistly acquiesced to whatever was presented to them.

The third seat has been vacant because its former occupant, Florence Fruehan, the former physician, is now a felon, joining Kimberle Weeks, the former supervisor of elections, in that category of former Flagler elected officials: Fruehan a little over a year ago pleaded guilty to felony battery on a person older than 65 after a state investigation led to his physician’s license being yanked after the state found him to have groped women in his practice. Fruehan had sought the seat on the Mosquito Control District to bring some accountability and oversight to the board. It didn’t last. (Somehow Fruehan was still listed as an active voter in a recently acquired database of eligible voters in the county, though as a felon still on probation, he is not eligible to vote.)

Kwiatkowski initially ran for a seat in 2004. He lost in a three-way race. In 2008, he beat Barbara Sgroi by 4 percentage points out of more than 34,000 votes. He was not challenged in 2012, but that year Sgroi beat Konnie Rea by just 138 votes out of 35,240 cast for Seat 2. In 2016, the year Fruehan was elected, neither Kwiatkowski nor Sgroi were challenged.

Now, for the first time since 2008, all three seats on the mosquito board are being contested simultaneously, a direct reflection of the board’s troubled few years. Sgroi and Kwiatkowski are fighting for re-election.

The races are ostensibly non-partisan, though few really comply with or believe the pretense: all three races are being followed by the two parties, with a Democrat and a Republican in two of them and two Republicans in the third.

Kwiatkowski, a Democrat, is a retired mailman and longtime, now retired, volunteer firefighter. His challenger is Perry Mitrano, 62, is the former Bunnell director of solid waste and the water utility. That race has generated the most interaction between candidates, reflected in their exchanges in the pages of the Palm Coast Observer. (See below.)

Sgroi is being challenged by Michael Martin, 71. Both are Republicans. Neither is much for words, neither having posted a profile of his or her candidacy on the elections supervisor’s site or on social media. Martin’s campaign tag line appears to be from his son: “Vote for my dad!” (Martin corrected us: the line is attributed to his dog, Bob. See his comment below.) And in an inexplicable error, the website listed for his campaign, on the supervisor of election’s website, is actually Mitrano’s Facebook page.

Martin Brabham, 58, a Realtor for 22 years, was the 2018 president for Flagler County Association of Realtors and has been a Palm Coast resident since 2001. He said he decided to run because the seat was open and he got encouragement to do so from others, though like his opponent, Ralph Lightfoot, he’s running a word-of-mouth campaign: neither has filed financial contribution documents because neither raised or spent money on the campaigns.

Brabham is a Republican. His opponent, Ralph Lightfoot, is a Democrat (and a former head of the local Democratic Party). Lightfoot retired from IBM as an IT manager there for 27 years, and has lived in Palm Coast since 2004. He tried to win an appointment to the mosquito control board after Fruehan had to relinquish the seat, but no appointment was made. So he is now running for the seat.

Over the past few weeks the Palm Coast Observer ran letters by Kwiatkowski, Mitrano and Sgroi about the race. The letters were not intended as an exchange, but turned into one after Mitrano decided to answer Kwiatkowski, and the Observer subsequently gave Sgroi a chance to address claims by Mitrano. The Observer gracefully gave us permission to run the exchanges below. They appear as published in the Observer, without additional editing but for minor quirks (Sgroi chose to write each paragraph of her response in quotes. We removed the quotes) and with the addition of an editor’s note that fact-checks a claim.

Jules Kwiatkowski:

Yard signs don’t get votes. You get votes by the merits and service you give to the voters. I have served 12 years as commissioner and chairman of the East Flagler Mosquito Control District. I have kept the ad valorem tax the lowest it has been since 2013, and it keeps going down. I think I have earned your vote. Remember, mosquitoes don’t bite, they suck.

Editor’s note: Kwiatkowski is making a misleading claim about the district’s tax rate. The tax rate the district has just enacted, which applies to next next year’s tax bill, will be the lowest, by a thousandth of a cent, since 2015. But the board has raised the tax rate four times in the last 10 years of Kwiatkowski’s tenure, including in 2017 and 2018, the years surrounding the district’s financial crisis. The tax rate has not kept going down, as Kwiatkowski claims. The rates of the last 10 years are as follows:

$0.2038 in per $1,000 in taxable value in 2011
$0.2540 in 2012
$0.2533 in 2013
$0.2423 in 2014
$0.2376 in 2015
$0.2395 in 2016
$0.2403 in 2017
$0.2518 in 2018
$0.2458 in 2019
$0.2375 in 2020

 

Perry Mitrano:

I would like to rebut my opponent’s letter to the editor. Here are somethings Mr. Kwiatkowski fails to mention in his letter.

Let’s start off by saying I’m not going to bash or demean my opponent and or the rest of the East Flagler Mosquito Control District Commission by saying anything about their person. I have met them both my opponent and the other incumbent in Seat 2. They are very nice folks, but that’s it.

I am campaigning for Seat 1 because of the mismanagement of this current board of commissioners. Read these articles to hear a different story:

State Audit Finds Slew of Irregularities and Procedural Disarray at Flagler’s Mosquito Control District, But No Fraud

Flagler Mosquito Control District In Crisis as It Faces $1.1 Million Deficit in $1.8 Million Budget, Weeks After Dedicating New HQ

In this article, it has several other links that made me so alarmed that I waited three years for this election. In my opinion as a taxpayer, all three of these commissioners should have resigned due to their own internal audit found the commission to be “complacent.”

This caused Sen. Travis Hutson and Rep. Paul Renner to call for a state audit that found a mess. I’m not sure if the commissioners back then realized, but we almost lost the East Flagler Mosquito Control District. As a result of their poor judgment and mismanagement, a director was retired, the office manager resigned, four jobs were cut from the budget, and a setback of reserves was nearly wiped out.

My opponent went on to say “I wasn’t aware of the situation” and the number two seat said, “It’s just a little issue.” I’m not making this stuff up.

So I’m appalled, angry, and disgusted by what I heard; however, nobody on the commission resigned.

Since this mess, one commissioner was removed due to personal issues by the agricultural commissioner, but nobody was replaced by special election. I was told that the reason for this was the cost to do so about $90,000. They could not afford to do it at the time because the budget was nearly broken. Instead, they have been functioning at a two-member board for the last three years — unheard of because there is nobody to break a tie. If someone gets sick, the district could not technically pay their bills.

Recently, on one of the conference call meetings, I even heard one of the commissioners say they never used to get financial statements from the past director, and she complimented the current director on the fine job he is doing. That’s the only refreshing part: The current director and staff are doing great.

I say, as a taxpayer, vote the complacent board out. Time for some new blood for the mosquitoes to look for, but the difference is the “Mosquitoes don’t bite they suck” as my opponent says. I say “Fight the Bite,” vote Perry Mitrano for East Flagler Mosquito Control District Seat 1 because I promise to be engaged.

 

Jules Kwiatkowski:

After many months of interviews and thousands of documents, the state has not found any monetary discrepancy. The only errors were they found that we made some change orders with out following Florida regulations. We are not CPAs.

 

Perry Mitrano:

If I may respond to Commissioner Kwiatkowski’s selective understanding of the state audit report requested by Rep. Paul Renner and Sen. Travis Hutson. The only part of the dozen or so audit findings found against the board was the fact there were no illegal activities. What about the rest of the story conveniently forgotten by Commissioner Kwiatkowski?

On that footnote, the rest of the findings uses the term “The Board” referencing the current Board of Commissioners’ consistent failures to follow, use or even train for policies that would have prevented this egregious audit.

For 12 years, Seat 1 Commissioner Kwiatkowski — and eight years for Seat 2 Commissioner Barbara Sgroi —  they only reacted to the audit. Neither uses any type of outreach to the general public other than the grand opening of the new facility shrouded by reporters’ questions on the $1.1 million oversight.

I guess that outreach is not important to these commissioners, only that the rates were kept low. Very shallow on their part to only speak of the only thing they have done: keep taxes low. It makes me suspect on how they may have even come to the numbers. How did they calculate the number with their problematic bookkeeping?

Mr. Editor, here is the summary of the findings as written and copied from your own news article by staff writer Jonathan Simmons February 25, 2019:

The following state of Florida Auditor General operational audit summary findings and the East Flagler Mosquito Control District management’s responses are compiled from the audit report.

State audit finding 1: Contrary to State law, the District did not use a competitive selection process to obtain architectural services for the Consolidated Facility Construction Project.

East Flagler Mosquito Control District management’s response: As stated in the Auditor’s findings, the District utilized the “piggy back” method of contract procurement when soliciting the services of the design firm. ”Piggy backing” is a common practice utilized by local governments when the selection process has already been undertaken by another agency, in this case, Flagler County. The District will develop policies and procedures before considering any such projects in the future.

Finding 2: The District did not maintain records evidencing professional liability insurance required by the Consolidated Facility Construction Project architect contract.

District management’s response: The District concurs with the finding. Proper contract management by a qualified project manager should have included a procedure for verification of insurance coverage. The District will develop policies and procedures before considering any such projects in the future.

Finding 3: The Board had not established policies or procedures for evaluating the suitability of proposed construction sites prior to obligating District resources for site leases.

District management’s response: The District concurs with the finding. The Lease with the County Airport should have included a clause for cancellation had the site not been suitable for the project. The District will develop policies and procedures before considering any such projects in the future.

Finding 4: Contrary to State law, the District did not retain all records identified in the construction contract agreement.

District management’s response: The District agrees with the recommendation. The former Director should have retained and cataloged all documents related to the project. The District will develop policies and procedures before considering any such projects in the future.

Finding 5: Although the Consolidated Facility Construction Project was completed a year after the planned completion date, District records did not evidence consideration of damage assessments against the contractor for delays.

District management’s response: The District agrees with the recommendation. Many circumstances delayed construction, as mentioned in the Auditor’s findings. Determining if the contractor bore any responsibility for delays would have required legal action. The building was completed, with a reasonable delay because of change orders and Hurricane Matthew without additional cost related to delays. The District will develop policies and procedures before considering any such projects in the future.

Finding 6: District procedures for monitoring construction project change orders could be improved.

District management’s response: The District agrees with the recommendation. Again, the former Director should have retained and cataloged all documents related to the project. The former Director should have also followed the District’s purchasing policy for approving purchases and properly informed the Board when required. The District Attorney will provide an evaluation for construction damages reimbursement.

Finding 7: The Board did not have policies and procedures for direct purchases of construction materials and the District did not take advantage of sales tax exemptions by making direct purchases of construction materials or document why such purchases would not result in cost savings to the District.

District management’s response: The District agrees with the recommendations. Options for the direct purchase of materials should have been formally documented and cost savings from sales tax exemption for supplying materials should have been weighed against the assumed risk of directly supplying materials to determine if there was any economic feasibility to this option.

Finding 8: The Board had not established policies and procedures for budget development and monitoring.

District management’s response: In the past, the District had followed a simple manual provided by the Florida Department of Agriculture and Consumer Services to prepare and track the budget, just as many mosquito control programs around the State do. The District has in the intervening time researched and prepared an anti-fraud policy, 5-year capital outlay plan, Capital assets policy, revised purchasing policy, purchased and implemented new accounting software, enhanced financial reporting so that the Board has better information with which to make decisions, and retained the services of a CPA to serve as a part-time CFO and is another check on financial monitoring and process improvement. We will continue to strengthen our policies and procedures in this area.

Finding 9: The beginning fund balance for the 2016-17 fiscal year original budget was overstated by $1.1 million because the estimates used by District personnel did not consider the most current available data.

District management’s response: The Auditors’ findings are consistent with what our independent auditor initially reported. Specifically, that $1.1 million was not misspent but was a budgeting error that should have been found and corrected by previous staff early on. Consequently, incorrect information was reported to the Board. The District now uses only Reserve and untapped contingency funds to estimate the beginning fund balance for the following year, which is a far more conservative method than the previous. The District will continue to improve its’ policies and procedures on budget preparation and monitoring.

Finding 10: District policies and procedures did not require and ensure that budget amendments that increase the budget are posted on the District Web site within 5 days after adoption and remain there for at least 2 years.

District management’s response: Previously, only the current year’s Budget documents were posted to the District’s website. Budget materials will remain on the website for at least two years.

Finding 11: District records could be enhanced by using capital projects funds to separately account for construction projects.

District management’s response: The way in which the expenditures for the capital projects were reported may have been cumbersome but did not negatively affect the tracking of expenditures, as this is a separate issue from the incorrectly stated estimate for the beginning fund balance. As stated, earlier in this report, budget preparation was the critical component for error. The use of separate funds will be further considered for capital outlay projects.

Finding 12: The Board had not adopted policies and procedures establishing the minimum unrestricted fund balance for the General Fund.

District management’s response: The District concurs with the recommendation. The GFOA recommendation may not be sufficient since the fiscal year begins October 1 and the intervening months until December when ad valorem revenue is collected to fund the current year’s budget are prime hurricane months. This potential for extreme storm events, as has happened in the past two years in a row, necessitates a greater fund balance to ensure services. A policy for replenishing funds is possible. As long as a policy for maintaining fund balances is in place as part of an overall budget policy, the Board can make decisions as to how to address replenishing funds as they see fit based on current circumstances as raising funds is the sole discretion of the Board at that time.

Finding 13: As of March 2018, the District had not established any anti-fraud policies or procedures.

District management’s response: Anti-fraud policy was adopted on April 16, 2018, and is based on the model policy available from the Association of Certified Fraud Examiners. Staff will receive training on this annually. To be clear, no fraud has been detected or reported.

Mitrano continues in his words: Ultimately, the board are the bosses, and the district director is the employee. The director must manage the day-to-day operation, and the board answers to us, the taxpayers.

Let’s make this clear to everyone that pays the East Flagler Mosquito Control fee: You have a choice. Vote for your current board that was the root cause of the negative audit findings as per the actual audit, or vote for change.

 

Barbara Sgroi: 

We moved to Palm Coast 23 years ago. Through the years, I volunteered with many organizations, including Palm Coast Fire Department, COPS, Flagler County Sheriff’s Office. I now serve on the East Flagler Mosquito Control Board Seat 2.

I would like to address some of Mr. Mitrano comments. Most are past tense. At that time, the former director was in office. Things have changed for the better.

First of all, we’ve been accused of having too much cash through overtaxing. But it would be irresponsible to not have adequate reserves as stated in our policy, which is based on the Government Finance Officers guidance.

We are rebuilding our reserves after keeping tax rates low for many years because of the recession and now have them at acceptable levels and can adequately address the growth we are about to embark upon in and outside the district. Contrast our prudent reserves and no tax increase this year with the county’s and city’s increases with the county’s keeping the same tax rate in excess of the roll-back rate; the county’s reasoning was to rebuild their reserves.

Specifically, we will start the fiscal year with a reserve at $1,005,368. This amount is comprised of:

Capital Outlay Reserve: $251,737

Cash Reserve: $692,119 (adding $42,119 from revenue this year for future helicopter maintenance of engine turbines estimated cost $71,500 for two years)

Sick and annual leave: $61,512

Cash Reserves: These funds are to be used when unexpected costs arise beyond what has been planned with contingency. They also provide funds to spend at the beginning of the fiscal year before ad valorem revenue is collected in December.

Future Capital Outlay: These funds are to aid in the purpose of items on the five-year capital outlay program and for long-term capital considerations. The district is heavily reliant on equipment to accomplish our mission planning for replacement of current equipment and acquisition of new types of equipment is a critical part of planning the budget.

Sick and Annual Leave Reserves: The expected cost of leave payouts upon separation from employment can be estimated by average staff turnover and any planned retirement.

As far as the fiscal year 2020/21 operating millage rate district-wide is .2375 mills which exceeds the rolled back rate of 0.2375 mills by 0%.

For example: If your home is valued at $100,000, your taxes for the year would be $23.75.

In conclusion: The district is financially sound.”

The exchanges in the Observer end there. Today, Mitrano added one more response on his Facebook page, which he introduces by making a baseless claim against the Observer: “Although they printed my rebuttal, it just seems that along with cultural bias, race, and religion or, for that matter, who we might be as a person, there is just too much negative press they likely would not have engaged me unless I was causing controversy.” You can read his Facebook entry here.

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