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Revere audit finds $2.2 million in idle city accounts, possible parking meter corruption

Revere Mayor Brian Arrigo (at microphone).
Revere Mayor Brian Arrigo (at microphone).(John Blanding/Globe staff/file 2016)

REVERE — An audit of Revere’s city government found more than $2 million in previously undiscovered money and two possible cases of corruption by municipal parking meter technicians, officials said Tuesday.

The two employees were placed on paid leave last week and are believed to be responsible for missing meter payments, which could total up to $90,000, Revere Mayor Brian Arrigo said in an interview Tuesday. Revere police are investigating the case and seeking to refer it to the state attorney general’s office, the mayor said.

The findings are the result of an audit Arrigo commissioned in March 2016, two years after starting his term as mayor. The consulting firm CliftonLarsonAllen identified 86 “funds” — various accounts and streams of revenue for the city — that had seen no activity since 2014, as of the last fiscal year, according to a report.

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“There were no written policies, no procedures, no formal reconciliations that were happening at the department level . . . for how to handle cash,” Arrigo said, sitting in his City Hall office with two staff members.

Those accounts held around $2.2 million of previously untapped cash for the city, the audit found. Nearly $800,000 will be returned to the city’s general fund, Arrigo said.

“These kinds of funds once upon a time were used for something, but they’ve become stagnant,” city auditor Richard Viscay said. “Nobody really took a look at them.”

A review of the parking department found that revenue had been steadily decreasing since 2012, reaching essentially zero in the last fiscal year. Of the city’s 274 parking meters, only 145 worked, according to a report.

The city’s parking revenue has been far behind that of similar nearby cities, according to data in the city’s report.

One of the employees at the center of the investigation into the missing funds was a parking meter technician; the other was a parking hearings officer and a back-up technician, Arrigo said.

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They were the only people who had keys and access to the parking meters, Viscay said.

Arrigo did not identify the employees, who have not been formally charged.

“When it comes to egregious actions against the city, and when it comes to egregious mismanagement or actions as an employee, I have to hold those employees accountable and make people know that there’s no place for people to do their job as poorly as that job was being done,” the mayor said.

Arrigo announced the findings of the audit at a City Council meeting Monday. The formal reports were shared with the Globe on Tuesday.

The audit, which cost the city about $72,000, had several recommendations for cleaning up the city’s finances, and the parking system specifically.

Arrigo said Revere has already begun to institute some “smart meters,” which allow for credit card payments,and will mandate that coin collection be done by two people at a time.

The city also plans to close some of its inactive funds, pay back government grants, and implement a comprehensive policy that ensures money is being tracked efficiently and consistently.

So how did the city of more than 50,000 overlook more than $2 million? The mayor said some “stagnation” before he took office contributed to the financial mismanagement.

“Any time you have a fresh set of eyes come in take a look at an organization or a department or an accounting system, you’re going to find something that people may not have been looking at before,” he said.

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J.D. Capelouto can be reached at jd.capelouto@globe.com. Follow him on Twitter @jdcapelouto.