A state audit questions the money handling by long-time director of the Corn Palace Mark Schilling. Earlier this month, the mayor of Mitchell asked Schilling to step down after seeing an initial report.
The audit was conducted in mid-December and Mayor Ken Tracy says when he saw the initial findings, he knew a change had to be made in the Corn Palace's leadership.
The analysis of the audit on the Corn Palace's books wasn't kind to Schilling. One of the first issues brought to light by the South Dakota Department of Legislative Audit was that Schilling would regularly count cash and checks received unsupervised. On December 13, the auditors asked for a flash report, which shows the net sales at a certain register. That number shown was more than $1,000 over what had actually been reported by Schilling.
"We have changed that policy and two people are counting the money now," Tracy said.
A second issue involved city-issued credit cards. The audit shows Schilling used his card to charge $3,500 for a trip to Las Vegas to attend a County Music Award show, but didn't have receipts to support the charges.
"It wasn't that the trips were not authorized, but when the bill was submitted for payment, proper documentation wasn't attached to that," Tracy said.
Though the Department of Criminal Investigation is now looking into Schilling's actions, Tracy says his decision to ask for the former director to resign was not based on wrong-doing, but because he violated city policy.
"There has been no proof of any theft or embezzlement of city funds," Tracy said.
The auditors have proposed several procedural changes to avoid similar issues in the future. Tracy says many of those changes are already in the works.
"They made 18 separate recommendations, some of them have already been implemented," Tracy said.
Schilling's former assistant, Jeri Mickelson, is now the interim director of the Corn Palace.
To see the full report click here.