Anchorage audit flags $30K in purchases for review

A refrigerator, subscriptions for a fitness app and $1,500 worth of coffee-making equipment. 

Those are among the 87 purchases made by Anchorage city employees last year that internal auditors deemed ‘questionable,’ warranting further review. The purchases were summarized in a recently completed audit by the city’s Internal Audit Department. 

Anchorage City Hall.
Anchorage City Hall. (Alaska Public Media)

In total, the audit — which is done each year — found about $31,000 worth of questionable or prohibited purchases, according to an itemized spreadsheet provided by the department. That’s .15% of the purchases made by city employees with procurement cards, essentially debit cards linked to a city bank account.

“It’s important to keep in mind that the questionable purchases that we did identify make up a very small portion of the total dollar value of the purchases of the municipality,” said Internal Audit Director Mike Chadwick.

The city labels purchases as “questionable” when they’re not explicitly allowed — or prohibited — in guidelines for what can be bought with procurement cards. 

Also on the most recent list of questionable purchases? A $700 wifi-enabled portable heater, cable TV subscriptions at several fire stations, microwaves and toaster ovens, and $1,600 worth of televisions for the police department. 

The review found some purchases prohibited by the city’s procurement rules, Chadwick said, including meals and water for employees, and a replacement motor for a department’s fiber-optic Christmas tree.

Chadwick said the annual audit helps departments come up with clearer guidelines for when purchases are an appropriate use of taxpayer money. Auditors also follow up with individual employees and departments. 

“For prohibited purchases, the purchasing department tries to seek reimbursement for some of those purchases. For questionable purchases, they try to get a better explanation of what the purchase was, and get a better understanding of it. And then perhaps redirect the employee to a purchase that would have been more appropriate,” said Chadwick.

That can include directing the employees to purchase a cheaper version of a product, or directing them to use the city’s existing contracts to get cheaper rates. In most cases, he said, if items are needed in a break room, employees will pool their personal money together or bring the item from home. 

Departments are also given the chance to find more information about purchases deemed questionable, he said. For instance, the Anchorage Police Department’s purchase of more than $1,500 in coffee-making supplies was flagged this year, along with a note that the department had spent $4,000 on coffee-making equipment in 2019. 

In an emailed statement, APD Spokesperson MJ Thim wrote that getting charges marked as questionable is “routine when more information is needed.” He said a review of the coffee supply purchases found they were warranted. 

“The coffee machine purchase is part of the ongoing renovation project purchases for auditorium at headquarters which will host large in-person meetings and trainings. These specific charges were found not prohibitive after additional information was provided,” he wrote. 

Chadwick said auditors reviewed almost 48,000 purchases individually. They double-check their work by searching for keywords that have come up in the past, like “flowers” and “donuts.” The review ensures employees and departments know their expenses are being tracked, he said.  

“This is a story of government working well to check itself, because you’re never going to have a perfect environment. But we’re pretty darn close,” he said. 

Lex Treinen is covering the state Legislature for Alaska Public Media. Reach him at ltreinen@gmail.com.

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