June 16, 2024

State audit reveals issues with Lorimor

The Union County town of Lorimor was noted for several issues in an audit according to Iowa State Auditor Rob Sand.

According to the report released June 5, auditors recognized major concerns about how a city clerk handled city funds. “Cities have multiple accounts,” Sand said, “and if funds are not properly attributed to the accounts where they are due, then you can end up in a messy situation like this.”

In August 2022, Doris Loy was fired from her job as city clerk of Lorimor.

The state auditor’s report shows there was a $250,000 deficit in the town’s General Fund budget. Sand says auditors found Lorimor residents were being overcharged for natural gas service and had paid 44 % more in property taxes than was required. The report also listed Loy’s request for back-pay after she was fired.

“Someone asking for payouts when they are terminated and the basis that they are asking for that on is a handbook where electronic evidence shows it was edited just shortly before that person was terminated,” Sand said. The report identified more than 24 concerns about Loy’s bookkeeping. One issue is checks signed before she had authority to do so. “This is a red flag,” Sand said. “That just shouldn’t ever happen.”

Auditors could not locate two computers the city acquired about eight months before Loy was dismissed. Loy has recently been city clerk in Woodburn in Clarke County and Patterson in Madison County as well. In 2013, Loy was fired after working for about a decade as city clerk in Grand River in Decatur County. A special investigation by the State Auditor’s office in 2013 found Loy was responsible for mishandling $27,000 of city funds.

The audit was Aug. 1, 2021, through July 31, 2022. Sand provided the city with recommendations to address each of the findings. The city council has a fiduciary responsibility to provide oversight of the city’s operations and financial transactions. Oversight is typically defined as the “watchful and responsible care” a governing body exercises in its fiduciary capacity.