Audit says Wayne County Treasurer withheld $106 million during cash crisis

DETROIT (WXYZ) - A report released today by Wayne County's Auditor General says Treasurer Ray Wojtowicz withheld significant amounts of money from officials while the county was facing the threat of an emergency manager.

The funds reside in the county's Delinquent Tax Revolving Fund, a very complicated but important source of revenue, which Wojtowicz now says will kick in $150 million towards the county's general fund and help draw down a mammoth deficit.

The fund has existed since 1976. When county residents don’t pay their property taxes on time, it’s the county treasurer’s job to collect what's owed, adding on interest, penalties and fees. Everything yielded on top of the tax bill is put into the revolving fund.  When the account grows large enough, some of that money is supposed to be shifted to the general fund and be used to help run the county.

Earlier this year, most believed the fund held about $82 million and County Executive Bob Ficano wanted to use it all for his last-ditch effort to bring down the county’s $175 million deficit and stave off an emergency manager.

But Wojtowciz didn’t want to give any of it up, saying he needed the money as collateral.  But earlier this month he reversed course, agreeing to share the full $82 million with Ficano.

His reversal happened around the same time Auditor General Willie Mayo says he discovered Wojtowicz’s office was concealing significant amounts of cash.

According to Mayo’s audit, the revolving fund has been flush with at least $106 million for 2014 alone, which the rest of the county didn’t know about . Between now and 2015, the audit says the treasurer is sitting on more than $127 million that could be used to bring down the county’s mammoth deficit.

The auditor says it’s money nobody knew about because it was placed in “restricted” accounts. Mayo's predecessor Brendan Dunleavy says that money could have gone a long way in recent years.

"It’s troubling because you’ve got employees out there that are getting furlough days," he said. "It’s troubling because you have rape kits that are not being processed, and you have money that he’s not telling you he’s sitting on."

Deputy County Treasurer David Szymanski says his department hasn’t hidden a dime and that it's operated the fund openly and honestly.  He says many of the auditor general’s findings are incorrect.

"I’m not so certain that he’s missing something as much as it that he’s got a political agenda of some sort," Szymanski said, without elaborating. "I don’t know why he’s saying the things that he’s saying."

Tonight  Szymanski says that, even though he insists no money was being hidden, his office is bringing much more to the table than they first discussed.  At least $150 million this year, and more in the years to come. He insists it has nothing to do with today's blistering audit.

County Commissioners will be officially presented with the audit's findings at a meeting Wednesday morning.

Contact 7 Investigator Ross Jones at rjones@wxyz.com or at (248) 827-9466.


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