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Audit shows improper spending in Williamsport

WNEP Wilkes-Barre/Scranton logo WNEP Wilkes-Barre/Scranton 10/23/2021 Chris Keating

"RVT was buying or purchasing numerous capital assets. Grants that weren't for RVT or transit-related was funding those."

This clip was from the city of Williamsport's virtual finance meeting earlier this week. 

An audit presented by RKL, an accounting and business consulting firm, detailed that millions of dollars of state and federal grants were misappropriated by Williamsport's transit system, River Valley Transit, in 2019.

"You hope that it is not true but the audit presentation this week proved that everything that I questioned during my time on City Council was true," said Mayor Derek Slaughter.

Back in March Newswatch 16 broke the story about an ongoing Pennsylvania attorney general's investigation into the city's finances between the years of 2009 and 2019. 

Bill Nichols was the city's finance director and River Valley Transit's manager during that time period. He was fired just days after Derek Slaughter began his term of mayor in 2020.

"You have to create a budget off actual numbers, facts. You can't just guess at the budget. You can't just guess at the numbers. So, it has been extremely difficult over the last year and 10 months or so to run the city from a financial perspective," said Slaughter.

According to the audit, River Valley Transit was using grant monies to purchase assets that were not transit-related. 

Auditors say the transit system is at least 11 million dollars in debt.

"An organization that is the size of RVT having 11 million dollars in debt is highly unusual from that standpoint," said Mark Zettlemoyer, auditor at RKL Accounting.

"Any money that was misappropriated or misallocated from the state and federal transit grants, we will probably have to pay at least part of that back to PennDot and FTA. If not all of it," said Slaughter.

The state attorney general's investigation into the alleged misappropriation of funds is ongoing.

RELATED: State investigating city of Williamsport, River Valley Transit finances

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