City expanding P-card purchasing system

ALBANY, Ga. — City officials are expanding a credit card-like program that allows some employees to purchase authorized items in a move they believe will streamline the purchasing process.

Already in use by department heads and the city’s management team, the P-card system is widely used by the state government and educational institutions to increase control and efficiency of institutional purchases, Central Services Director Stephen Collier said.

The program is being expanded to employees who often make authorized purchases on behalf of department heads or city officials but who either have to be reimbursed or be cut a paper check. Not all employees are being given access to the program.

Under the expansion, Collier said that department heads have named employees who they say have authority to make purchases. Those employees will be given a P-card and will undergo training.

“It essentially streamlines our purchasing process,” Collier said. “We’ll reduce all of the accounts payable that we once had into one account with Bank of America and … also trim down the amount of paperwork and administrative issues to be more efficient.”

But concerns do exist about the possibility for fraud and abuse of the program, which ultimately means lost tax dollars.

The state of Georgia, which uses the P-cards for both government and educational employees, found in a 2008 audit that its P-card program suffered from chronic abuse due largely to a lack of oversight and poor management.

In one instance, a Georgia Tech employee was able to embezzle $170,000 over a four-year period through the program before being caught. That employee, Michelle Harris, was later indicted by Attorney General Thurbert Baker and entered a guilty plea March 16 to one count of racketeering. She was sentenced to 10 years in prison and 10 years on probation.

“Ten years in prison is a clear message that violating the public trust will not be tolerated in Georgia,” Baker said at the time, according to information on the Attorney General’s website. “The P-card program, while set up to allow state employees to make state purchases more efficiently, became a slush fund for some employees who found a way to criminally circumvent the safeguards in place to prevent misuse.

“This prosecution, as well as the other P-card prosecutions brought by my office, signals that the days of public monies paying for corrupt employees spending sprees are over.”

Fast forward two years later, and Collier said that advancements in technology and controls implemented by both the city and Bank of America should help curtail the possibility for abuse.

“With the software we have, we can limit the types of stores a card can be used at, we can see instantly when a card is used and whether it was an authorized purchase or not, and there are several layers of eyes on this thing so that it’s not just the department head who sees it, it’s finance and the guys on the fifth floor,” Collier said.

The system will allow for what city officials call “honest mistakes” in the program, such as inadvertent use of the card, so long as all funds are repaid to the city by the employee and it doesn’t become a chronic problem.

But scrutiny, Collier said, will be strict. All unauthorized purchases will be repaid by Bank of America if there is an instance of fraud or abuse, but, in turn, the bank is requiring the city to terminate any employee who intentionally abuses the program.

“We’ve talked with the state; we’ve looked at cities that use it down in Florida, and we called over to Albany State (University) and talked to their finance guy who says he loves it because he can see, more clearly, where their money is going,” Collier said. “And if there is a problem, he can cancel a card right on the screen.”

Each card will have a maximum purchase limit of $1,000 unless travel for city-related matters requires more. In that instance, employees can access up to $3,000 for travel expenses approved by their supervisor.

Some department heads have already limited the amount their employees can access or limited the types of stores where purchases can be made.

For instance, Collier said that if Recreation and Parks typically purchases items from Lowes or Home Depot, Department Director Suzanne Davis can limit her subordinates with the card to purchases from those two locations.