Three small governments declared unauditable; final 2020 tally released

Dec 28, 2020

Today, the Office of the Washington State Auditor issued reports declaring three small local governments unauditable, bringing the total of such reports to seven for 2020. The State Auditor's Office (SAO) also notified local counties of these unauditable governments, a step toward halting their use of tax money, restricting payments for expenditures, and their possible dissolution under a new state law.

“Since we launched our effort to ensure every government in Washington is audited, many in danger of being declared unauditable have stepped forward to become accountable,” said State Auditor Pat McCarthy. “Today's reports identify only seven of Washington's more than 2,000 local governments as unauditable. Nevertheless, our goal is to ensure that every single government that receives public tax dollars is accountable to the public, and these reports are part of that effort.”

Longstanding law in Washington requires every local government to submit annual financial reports to SAO and participate in an independent audit at least once every three years. The State Auditor's Office worked with the Legislature and local governments to address the small number of governments that do not comply with these accountability laws.

This year, the Legislature passed a law requiring SAO to notify the legislative authority of a county and the State Treasurer of any special purpose districts in their jurisdiction that are determined to be unauditable. The new law places restrictions on releasing sales or use taxes to those governments, restricting payments for expenditures, and allows counties to dissolve or absorb those governments. A government deemed unauditable is also referred by SAO to the State Attorney General's Office for possible legal action.

The local governments declared unauditable today were:

You can read the report on 2020's unauditable governments here.