SALT LAKE CITY — After months-long investigations into a mysterious trust fund linked to the embattled Utah League of Cities and Towns, state auditors released an audit Friday determining that the fund contains public money and should have been terminated years ago.
Two ex-league leaders, former director Ken Bullock and former chief financial officer Michelle Reilly — who both stepped down from their positions before a state audit was released that accuses them of misusing public funds — both help manage the trust fund, called the Utah Municipal Cooperative II.
Questions about the fund arose after state auditors discovered the fund while investigating the league, concluding that Bullock and Reilley used taxpayer-funded credit cards for personal purposes.
Auditors concluded that the trust, which contained about $1.3 million when it was created in 1993 for the purpose of improving the services provided to the Utah League of Cities and Towns, did not abide by some of its own bylaws.
Auditors reported the trust lacked oversight — and did not inform the Utah League of Cities and Towns board of its accounting practice. Nor did the trust dissolve on Dec. 31, 2012, the termination date listed in the trust’s organizational agreement.
However, upon reviewing the trust’s finances, auditors concluded the trust “appeared to be predominantly administered for the overall benefit of the league” — the stated mission of the trust in its operating agreement.
Nonetheless, auditors have recommended the audit “wind up” its operations and release its remaining assets to the Utah League of Cities and Towns, in accordance with its agreement.
On Oct. 31, 2016, the trust held approximately $530,000. The audit report did not clarify how much money is currently left in the fund.
Before the state audit, the fund’s origin and purpose has been somewhat of a mystery to current league leaders, but the …read more
Source:: Deseret News – Utah News