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Bauxite payroll needs action; emergency council session needed to resolve issue

August 15, 2014

An emergency council session has been called to deal with issues regarding payment of Bauxite employees.

Mayor Johnny McMahan sent an email to all Bauxite city employees Friday morning stating, "Your bi-weekly payroll check may not be available today, Friday, Aug. 15, 2014, because of the lack of a second signature that is required on each check. Mr. (Wilson) DuVall made out the checks Wednesday and I signed them on Thursday, but because of the action of the council last Thursday, apparently we have no legitimate officer to sign as the second signature. The bank will not honor the checks unless two signatures are signed on each check. The matter is our of my hands; I have done my part by signing the checks."

The question about the payroll checks arose Wednesday when employee Christy Mitchell contacted Alderman Karen Brooks saying, "Can you sign payroll this week? You are still on the bank account."

During a special council session held on Aug. 7, the council approved a motion to remove Brooks as second signatory on all of the bank accounts. However, Brooks has not been removed from the official paperwork at the bank and a different second signatory had not been designated.

McMahan sent an email to Brooks on Thursday, saying: "I signed payroll checks for employees; we 'voted' to take you off; but it hasn't been done yet because we have to "approve" those minutes (which I presume we will do at Monday's council meeting) and then we need to appoint another person (Candace Carpenter) to sign checks; then those minutes from Monday's council have to be written and then 'approved' in another council meeting, and then taken to Malvern National Bank for them to do the required paperwork and get my signature and Candace's signatures on the new forms.

"This is something that will take at least 10 to 14 days at the earliest from today. You are still on the accounts; the employees will be calling you to sign their checks if they are not ready by tomorrow."

Don Zimmerman, executive director of the Arkansas Municipal League, stated that since action was taken Aug. 7 to remove Brooks as the second signatory on the accounts — even though the action was not completed — the council must vote to undo what was done in the earlier meeting.

"The best way, the most legal way, would be to call a quick council meeting," Zimmerman said.

Brooks responded to McMahan saying, "I have never tried to cause problems for the city, but have been accused numerous time of 'being part of the problem, not part of the solution.' I was taken off all checking accounts a week ago today, told Mayor McMahan then that he should start the process of taking me off all checking accounts and adding Candice Carpenter. If he had, all would be good...."

Brooks requested an emergency council meeting to be held at 4 p.m. today at City Hall. The purpose of the meeting is to undo the action taken Aug. 7 and replace Brooks as the second signatory on the accounts.

Brooks said, "It should take five minutes and the checks will be signed by 4:30 p.m." While state law does not require two signatures on all checks, Malvern National Bank does and McMahan says it will take the additional days to add a new signatory.

According to Zimmerman, without an emergency council session to undo the Aug. 7 action to remove Brooks from the accounts, Brooks would be violating Arkansas law if she signs the checks. Since the motion was adopted, Zimmerman says the only option is to reverse the earlier action.

McMahan said, "I don't know what the next step is for our employees getting paid. The special meeting last week was bungled by three council members who were determined to appoint a new treasurer so she could sign checks and take Karen Brooks off the account. The council did not think it through and this is the result. This is the incompetence I'm dealing with from these three members of the council and I can't fix their mistakes easily. I presume they will come up with something to take care of this issue. I'm sorry for our loyal, dedicated employees (being inconvenienced) by the council's actions."

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