Division of LocaL Government & schooL accountabiLity

o f f i c e o f t h e n e w y o r k s t a t e c o m p t r o L L e r

report of ExaminationPeriod Covered:

June 1, 2015 — June 30, 2016

2016M-408

Village of Sleepy Hollow

Parking Ticket Collections

thomas p. Dinapoli

Page

AUTHORITY LETTER 1

INTRODUCTION 2 Background 2 Objective 2 Scope and Methodology 2 CommentsofLocalOfficialsandCorrectiveAction 3

PARKING TICKET COLLECTIONS 4 Recommendations 5

APPENDIX A ResponseFromLocalOfficials 6APPENDIX B AuditMethodologyandStandards 9APPENDIX C HowtoObtainAdditionalCopiesoftheReport 10APPENDIX D LocalRegionalOfficeListing 11

Table of Contents

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State of New YorkOffice of the State Comptroller

Division of Local Governmentand School Accountability February2017

DearVillageOfficials:

A toppriorityof theOfficeof theStateComptroller is tohelp localgovernmentofficialsmanagegovernment resources efficiently and effectively and, by so doing, provide accountability for taxdollarsspenttosupportgovernmentoperations.TheComptrolleroverseesthefiscalaffairsoflocalgovernmentsstatewide,aswellascompliancewithrelevantstatutesandobservanceofgoodbusinesspractices.Thisfiscaloversightisaccomplished,inpart,throughouraudits,whichidentifyopportunitiesfor improvingoperations andBoardofTrusteesgovernance.Audits also can identify strategies toreduce costs and to strengthen controls intended to safeguard local government assets.

FollowingisareportofourauditoftheVillageofSleepyHollow,entitledParkingTicketCollections.This auditwas conducted pursuant toArticleV, Section 1 of theStateConstitution and theStateComptroller’sauthorityassetforthinArticle3oftheNewYorkStateGeneralMunicipalLaw.

This audit’s results and recommendations are resources for local government officials to use ineffectivelymanagingoperationsand inmeeting theexpectationsof their constituents. Ifyouhavequestionsaboutthisreport,pleasefeelfreetocontactthelocalregionalofficeforyourcounty,aslistedat the end of this report.

Respectfullysubmitted,

Office of the State ComptrollerDivision of Local Governmentand School Accountability

State of New YorkOffice of the State Comptroller

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Background

Introduction

Objective

Scope and Methodology

The Village of Sleepy Hollow (Village) is located in the Town of Mount Pleasant inWestchesterCounty.TheVillage covers approximatelyfivesquaremilesandhas9,870residents.ItisgovernedbyanelectedBoardofTrustees (Board)composedof sixTrusteesandaMayor.The Board is responsible for the general management and control of Villagefinancesandoverseeingfinancialactivitiesincludingthoseofthe Justice Court (Court). The Village has one elected Justice and one appointedActingJusticewhopresideoverCourtoperationsandtwofull-time clerks appointed by the Board.

TheCourthasjurisdictionovervehicleandtraffic,criminal,civilandsmall claims cases. The Justices’ principal duties include adjudicating legal matters within the Court’s jurisdiction and administering money collected from fines, bail, surcharges, civil fees and restitution. Inaddition, the Court is responsible for collecting, recording andreporting parking fines and penalties, and for maintaining files ofall issued parking tickets, processing themwhen they are paid orprotested and recording the dispositions. The Justices are required to submitmonthly reports to theOfficeof theStateComptroller’sJusticeCourtFund(JCF)onthefinancialactivitiesoftheprecedingmonth.

The clerks collect payments to the Court and assist the Justices with theirfinancialduties.Asof2012,theVillagehascontractedwithavendor to assistwith theprocessingof parking tickets, record andmonitor revenue from parking violations and enforce payment of unpaid parking tickets. The Board has authorized the vendor to mail collection letters and report delinquencies to the NewYork StateDepartmentofMotorVehicles(DMV).Duringourauditperiod,theVillageissued6,005ticketsandcollectedapproximately$255,690infines,penaltiesandfeesforparkingviolations.

The objective of our auditwas to examine theVillage’s processesand procedures over cash receipts from parking violations. Our audit addressedthefollowingrelatedquestion:

• DidVillageofficialsensureparkingticketfeeswerecollected,recorded and deposited in a complete and accurate manner?

WeexaminedCourtrecordsandreportsfortheperiodJune1,2015throughJune30,2016.

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Comments of Local Officials and Corrective Action

We conducted our audit in accordance with generally acceptedgovernmentauditingstandards(GAGAS).Moreinformationonsuchstandards and the methodology used in performing this audit are includedinAppendixBofthisreport.Unlessotherwiseindicatedinthisreport,samplesfortestingwereselectedbasedonprofessionaljudgment,asitwasnottheintenttoprojecttheresultsontotheentirepopulation.Where applicable, information is presented concerningthe value and/or size of the relevant population and the sample selectedforexamination.

The results of our audit and recommendations have been discussed withVillageofficials,andtheircomments,whichappearinAppendixA, have been considered in preparing this report.Village officialsgenerally agreed with our recommendations and indicated they have taken,orplantotake,correctiveaction.

The Board has the responsibility to initiate corrective action. Awrittencorrectiveactionplan(CAP)thataddressesthefindingsandrecommendations in this report should be prepared and forwarded to ourofficewithin90days,pursuanttoSection35ofGeneralMunicipalLaw.FormoreinformationonpreparingandfilingyourCAP,pleaserefertoourbrochure,Responding to an OSC Audit Report, which you receivedwiththedraftauditreport.WeencouragetheBoardtomakethisplanavailableforpublicreviewintheClerk’soffice.

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Parking Ticket Collections

ParkingticketfinescanbeasubstantialrevenuesourceforVillageoperations. The Board is responsible for adopting policies for collecting and enforcing unpaid parking tickets. The Justices are responsible for implementing Board policy and establishing procedurestoensurethatunpaidparkingviolationfinesareproperlypursued and any funds collected are deposited into the Village’s bank account.Inaddition,becauseafinewillnotnecessarilybecollectedforeachparkingviolation issued,abenchmark rate forcollectionsshould be established to periodically assess how effectively the Village’s vendor is performing. Theclerksdepositedreceiptsforfinescollectedintactandinatimelymanner. However, Village officials have not established sufficientprocedures for collecting unpaid parking violation fines or set abenchmarkforcollectionrates.AlthoughtheVillage’sparkingticketcollectionrateexceeded80percentduringfiscalyears2011through2015, the Village had $2.2 million in cumulative unpaid parkingticketsoutstandingasofJune30,2016.Thisincluded25,532parkingticketstotalingapproximately$1.7millionthathavebeenoutstandingformore thanfive years and 5,323 unpaid parking tickets totaling$459,540outstandingforlessthanfiveyears.

The Village has implemented some informal procedures for collecting parkingticketfines,suchascontractingwiththevendor.TheBoardhas authorized the vendor to send out up to three delinquent letters to violators and report vehicles with three or more unpaid parking ticketswithin an 18-month period to theDMVScofflaw Program(Program).1 The vendor’s representatives said they met with Village officialstodiscussremovingsomeoftheolderoutstandingparkingtickets or implementing a way to increase the collection rate. For example, the Police Department could issue an arrest warrant forthe vehicle registrant, undertake civil action (i.e., place a defaultjudgment against the violator), implement a program to impound(tow) or boot (immobilize with a locking device) vehicles, offeranamnestyprogram tocollectoutstandingfinesorcontractwithacollection agency to supplement the Village’s enforcement efforts. However,asofJune30,2016,theticketsremainedonthevendor’sreport of unpaid parking tickets and no additional actions were taken to collect these amounts.

1 TheDMVScofflawProgramallows local justicecourts tonotifyDMVwhenanindividualhasanunresolvedtrafficticketfora60-dayperiod.DMVallows30additionaldaysfortheindividualtoaddresstheissuebeforesuspendingtheindividual’s license until they address the outstanding ticket.

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Without a system to follow up on outstanding parking violations,established benchmarks for collection rates and additional enforcementmethodsforoutstandingparkingtickets,Villageofficialsarenotmaximizingparkingviolationrevenuesandcannoteffectivelyassess parking ticket enforcement procedures.

TheBoardshould:

1. Consider implementing a more aggressive written collection and enforcement policy and establish a benchmark collection rate.

2. Examine the effectiveness of collection strategies andconsider enhanced or alternative measures that may increase thecollectionoffinesandrelatedpenalties.

3. Periodically monitor and review unpaid fees for parkingviolations to track the effectiveness of the vendor’s collection system.

Recommendations

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APPENDIX A

RESPONSE FROM LOCAL OFFICIALS

Thelocalofficials’responsetothisauditcanbefoundonthefollowingpages.

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APPENDIX B

OSC COMMENTS ON THE OFFICIAL’S RESPONSE

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APPENDIX B

AUDIT METHODOLOGY AND STANDARDS

Toachieveourauditobjectiveandobtainvalidevidence,weperformedthefollowingprocedures:

• WeinterviewedCourtandVillageofficialsandthevendortoobtainanunderstandingofCourtoperations and Village policies.

• WeobtainedandreviewedareportofallunpaidandoutstandingparkingticketsasofJune30,2016.

• Fromthereport,wecountedthenumberofoutstandingparkingticketsasofJune30,2016andcalculatedthepotentialadditionalrevenuethatcouldbegeneratedfromtherelatedfinesandpenalties.

• We sorted the outstanding parking tickets by date of issuance to determine the number ofticketsissuedwithinfiveyearspriortotheendofourauditperiodandthenumberofticketsissuedmorethanfiveyearspriortotheendofourauditperiodandcalculatedthepotentialadditionalrevenuethatcouldbegeneratedfromcollectingtherelatedfinesandpenaltiesforeach period.

WeconductedthisperformanceauditinaccordancewithGAGAS.Thosestandardsrequirethatweplanandperform theaudit toobtainsufficient,appropriateevidence toprovidea reasonablebasisforourfindingsandconclusionsbasedonourauditobjective.Webelievethattheevidenceobtainedprovidesareasonablebasisforourfindingsandconclusionsbasedonourauditobjective.

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APPENDIX C

HOW TO OBTAIN ADDITIONAL COPIES OF THE REPORT

OfficeoftheStateComptrollerPublicInformationOffice110StateStreet,15thFloorAlbany,NewYork12236(518)474-4015http://www.osc.state.ny.us/localgov/

Toobtaincopiesofthisreport,writeorvisitourwebpage:

1111Division of LocaL Government anD schooL accountabiLity

APPENDIX DOFFICE OF THE STATE COMPTROLLER

DIVISION OF LOCAL GOVERNMENTAND SCHOOL ACCOUNTABILITYAndrewA.SanFilippo,ExecutiveDeputyComptroller

GabrielF.Deyo,DeputyComptrollerTraceyHitchenBoyd,AssistantComptroller

LOCAL REGIONAL OFFICE LISTING

BINGHAMTON REGIONAL OFFICEH.ToddEames,ChiefExaminerOfficeoftheStateComptrollerStateOfficeBuilding,Suite170244 Hawley StreetBinghamton,NewYork13901-4417(607)721-8306Fax(607)721-8313Email:Muni-Binghamton@osc.state.ny.us

Serving:Broome,Chenango,Cortland,Delaware,Otsego,Schoharie,Sullivan,Tioga,TompkinsCounties

BUFFALO REGIONAL OFFICEJeffreyD.Mazula,ChiefExaminerOfficeoftheStateComptroller295MainStreet,Suite1032Buffalo,NewYork14203-2510(716)847-3647Fax(716)847-3643Email:Muni-Buffalo@osc.state.ny.us

Serving:Allegany,Cattaraugus,Chautauqua,Erie,Genesee,Niagara,Orleans,WyomingCounties

GLENS FALLS REGIONAL OFFICEJeffreyP.Leonard,ChiefExaminerOfficeoftheStateComptrollerOneBroadStreetPlazaGlensFalls,NewYork12801-4396(518)793-0057Fax(518)793-5797Email:Muni-GlensFalls@osc.state.ny.us

Serving:Albany,Clinton,Essex,Franklin,Fulton,Hamilton,Montgomery,Rensselaer,Saratoga,Schenectady,Warren,WashingtonCounties

HAUPPAUGE REGIONAL OFFICEIraMcCracken,ChiefExaminerOfficeoftheStateComptrollerNYSOfficeBuilding,Room3A10250VeteransMemorialHighwayHauppauge,NewYork11788-5533(631)952-6534Fax(631)952-6530Email:Muni-Hauppauge@osc.state.ny.us

Serving:NassauandSuffolkCounties

NEWBURGH REGIONAL OFFICETennehBlamah,ChiefExaminerOfficeoftheStateComptroller33AirportCenterDrive,Suite103NewWindsor,NewYork12553-4725(845)567-0858Fax(845)567-0080Email:Muni-Newburgh@osc.state.ny.us

Serving:Columbia,Dutchess,Greene,Orange,Putnam,Rockland,Ulster,WestchesterCounties

ROCHESTER REGIONAL OFFICEEdwardV.Grant,Jr.,ChiefExaminerOfficeoftheStateComptrollerThePowersBuilding16WestMainStreet,Suite522Rochester,NewYork14614-1608(585)454-2460Fax(585)454-3545Email:Muni-Rochester@osc.state.ny.us

Serving:Cayuga,Chemung,Livingston,Monroe,Ontario,Schuyler,Seneca,Steuben,Wayne,YatesCounties

SYRACUSE REGIONAL OFFICERebeccaWilcox,ChiefExaminerOfficeoftheStateComptrollerStateOfficeBuilding,Room409333E.WashingtonStreetSyracuse,NewYork13202-1428(315)428-4192Fax(315)426-2119Email:Muni-Syracuse@osc.state.ny.us

Serving:Herkimer,Jefferson,Lewis,Madison,Oneida,Onondaga,Oswego,St.LawrenceCounties

STATEWIDE AUDITSAnnC.Singer,ChiefExaminerStateOfficeBuilding,Suite170244 Hawley Street Binghamton,NewYork13901-4417(607)721-8306Fax(607)721-8313