Audit reveals misuse of funds and other financial problems with Williamsport’s transit division

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WILLIAMSPORT – A Lancaster company says it found numerous financial problems, including misuse of funds, while auditing River Valley Transit (RVT), a division of the Williamsport government.

Representatives of the RKL used terms such as “a kind of shell game” and “buried transactions” on Tuesday when reviewing the examination for the period July 1, 2019 to June 30, 2020 for the finance committee of the city council.

Many back and forth transactions between RVT and the city were discovered, inconsistencies and funds not used as intended.

The city uses RVT money to fund local projects, and suburban communities that subsidize bus services have either not been billed or the money has not been collected, said RKL representative Mark Zettlemoyer, the audit found.

Internal controls are absent and management has used the funds for purposes other than those allocated to them, he said.

The RKL representatives stopped short to say that the financial problems were rising to the level of crime.

However, the Attorney General’s office is known to have been investigating the operations of RVT, of which William E. Nichols Jr. served as director general from 1978 until his January 2020 discharge. He was also the city’s finance director.

One of RKL’s recommendations is that no one should be able to run a transaction from start to finish.

Mayor Derek Slaughter, who fired Nichols when he took office, said changes had been made to prevent this from happening.

River Valley carries more than one million passengers annually and serves much of the populated area of ​​Lycoming County.

For the 12 months audited, the company had operating income of $ 1.7 million and operating expenses of $ 13.3 million.

Such losses are common with transit systems that rely on state and federal grants to cover the difference, Zettlemoyer said.

However, long-term debt of around $ 11 million is unusual, he said.

RVT also provides management services for the Endless Mountain Transportation Authority in Bradford County.

The comment “a kind of shell game” was made in connection with RVT, which wanted to buy three vans for which it had no funding.

It used approximately $ 66,000 in Endless Mountain money to buy the vans and then reduced the same amount that agency had to pay for management services, said Zettlemoyer, the audit found.

RVT was mistakenly assigned as a local Match for Grants that UPMC provided for a special service, said Tim Kraft of RKL.

Zettlemoyer summed up the report by saying it was an interesting year and advocating more checks and balances.

The city is waiting for the results of an audit so it knows where it stands financially before starting work on the 2022 budget.

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