Relief Association Audits and Pitfalls
A major source of funding for volunteer, or combination, fire companies in Pennsylvania comes from the Volunteer Fireman's Relief Association. This funding comes from taxes imposed on out-of-state insurance companies which provide in-state insurance policies. Unlike the funding received by many companies from municipalities, state law requires that each relief association be subject to an audit of these funds.
Unfortunately, these audits often turn up issues within fire companies that could have been prevented. For example, a recent audit of a Luzerne County fire company found a number of expenditures that were not properly documented including loans made from the Relief Association to the actual Fire Company. These audits are done by the Auditor General and can result in a suspension of relief funds. Additionally, the audit findings are often turned over to local and state law enforcement officials (often the attorney general or district attorneys).
Be aware that these audits are all public record. They are available online: Pennsylvania Volunteer Fireman's Relief Association Audits.
What are some of the most common issues?
- Failure to keep an inventory of items purchased with relief funds;
- Failure to have a record of purchases (receipts which match up with expenditures);
- Purchasing items which are not permissible;
- Improper loans made from the Relief Association to the Fire Company (loans are permissible but there are formalities that must be adhered to).
Your Relief Association can be a major asset for provide equipment, gear, apparatus and training for your members. However, you should be certain that the proper safeguards (administrative policies, by laws and accounting processes) are all in place and there is strike adherence to the relief laws.