Published: January 13, 2023
In 2022, just one new local government fell into unauditable status and three others were removed from the category, continuing progress toward accounting for the public finances of all of Washington’s 2,300 local governments.
A new year-end report by the Office of the Washington State Auditor identified six local governments that failed to provide basic financial records and cooperate with an audit—meeting the definition of an unauditable government. Five of those governments were also deemed unauditable the previous year.
The State Auditor’s Office launched a campaign to highlight the issue of unauditable local governments in 2019, focusing on approximately 40 governments that failed to meet state accountability laws. The Legislature passed reforms aimed at addressing the issue in 2020, allowing counties or the State Treasurer to withhold funds from such governments in their jurisdiction, as well as dissolve or absorb those governments.
“This has been a successful team effort to ensure accountability for public funds,” said State Auditor Pat McCarthy. “Our goal is to make sure every local government in the state reports its finances and has its accounts independently reviewed by our Office. That is the law, and it is what the public expects.”
Most unauditable governments have been small special purpose districts, such as irrigation or flood control districts. Since reforms took place, the majority of unauditable governments have taken steps to comply with accountability laws and some have been dissolved by their counties.
In the most recent status report to the Legislature, SAO reported one new government as unauditable in 2022, a sewer district in Yakima County. The six governments identified in the report are pending county action—either dissolution or appointment of new governing bodies. Of the governments listed in the 2021 report to the Legislature, two filed their financial reports and completed audits, one was dissolved and five remained on the list. The full 2022 report can be found here.