Officials turned IRS penalty into opportunity to improve city system
Glenarden owes the Internal Revenue Service $100,000 because officials failed to file correct paperwork regarding city contractors for two years.
Of course, it’s not something the city is proud of, but officials — present and past — are being open and honest about the problem, which says a lot.
Too often, government leaders discover a mistake and hope the error goes unnoticed by the public, stonewalling the media on any potentially negative topic.
Glenarden officials did the opposite. The mayor and council discussed in a public meeting the fact that for fiscal 2011 and 2012, high turnover among city staff caused significant administrative problems and many contractors were never given 1099s — a federal form used to track money given to contractors. As a result, the city incurred about $150,000 in fines.
Even the mayor who was in charge during the oversight, Gail Parker Carter, was open to discussing with The Gazette the turnover problems that led to the penalties under her watch.
Officials are now trying to get the correct paperwork filed, which has lessened the penalty amount to $95,000 so far, and they hope to knock the total down to about $15,000, if not less.
Granted, having a city with an annual budget of about $3 million incur a six-figure penalty due to poor oversight is never acceptable. Even with the amount reduced, any taxpayer money wasted on administrative errors is unacceptable.
Mayor Dennis Smith, City Treasurer Chris Wood and City Manager William Reaves are working to reduce the penalty and create a system that will prevent the problem from occurring in the future. They must also remember to look at why so much turnover occurred in hopes of better retaining city employees going forward.
Smith, who was elected mayor in July, could have easily blamed the former mayor and simply forked over taxpayers’ money. Instead, he’s trying to save the money and fix the problem.
Their efforts are commendable, as is their openness about the challenge the city is facing.