Feb 26, 2014 6:24 PM by Ian Auzenne (Photo courtesy: MGN Online)

Morse audit uncovers deficit, violation of tax code

An independent audit of the Morse village government found that the village is running out of money and that municipal officials may have violated IRS regulations and the state's governmental code of ethics.

The audit, released this week, says Morse has shown a loss in both net assets and fund balances. The audit says because of this, the city has limited resources to continue operating if any major repairs or projects were to arise.

The audit goes on to say that the village clerk failed to make payroll tax deposits on a monthly basis, putting the village at odds with IRS rules. In addition, the audit found that the village did not give auditors a list of business interests and family members so they could determine if the village was in compliance with bid laws and other state regulations.

Morse Mayor Robert Istre says the problems with funding came from the village not raising water or sewer rates for approximately 10 years.  Istre said the village government raised water and sewer rates to an amount that would cover the deficit and allow the village to pay for any repairs that may be needed in the future.

Istre also said the payroll tax issues have been cleared.  According to Istre, the village clerk submitted some of the documents to the IRS late.  Since then, he says, he and his staff have learned the proper procedure and have received a clean bill of health from the state legislative auditor.



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