CORPUS CHRISTI, Texas — A review of a portion of nearly $1 million in credit card purchases over a 15-month period has Port of Corpus Christi commissioners making changes to the port's travel policy.
Tuesday, the commission unanimously voted to amend the policy, based on recommendations from an outside audit firm.
An internal audit reviewed policies and procedures, structure, internal controls, and practices over the executive and commission expense reimbursement processes.
As KRIS 6 News has previously reported, this review resulted in eight findings, three of which were labeled as high-risk.
This audit came on the heels of the resignation of Port CEO Sean Strawbridge and KRIS 6 News investigation into his spending.
According to the report by Weaver and Tidwell, it was determined that "the Port does not have an effective control environment designed to ensure proper governance over travel and entertainment expenses, consistent documentation, and proper stewardship over the use of Port funds."
In evaluating the stewardship of port funds, Weaver and Tidwell, found current internal controls do not allow for effective management and oversight of expense and travel funds, labeling it as one of three high-risk areas.
"The Port's process for the review and approval of expenses for executives and commissioners does not include a pre-travel request process, which is required by all other Port personnel, that informs of pending expenses and results in a review and approval after expenses have been occurred" the report states. "Port policy also lacks specificity regarding the expectations of reasonableness for expenses incurred while on business travel and for entertainment, including guidance that specifies the maximum rates acceptable for the Port for hotels, meals, and entertainment on a per person basis."
This audit revealed the average cost per person per meal during this 15-month period was $214 and the highest cost was $707.
The advisory firm also found that some expenses related to business travel, which included hotels, airfare, and taxi services, "appeared to be excessive based on historical averages."
However, "the expenses identified are not effectively addressed in the Port's current policy," the report states.
The report also noted that 23 of 35 receipts for meals and entertainment were not itemized. The port began requiring itemized receipts as of June 1, 2023.
Consultants used the port's most recent travel policy in evaluating executive and commissioner spending, a policy written by former CEO Strawbridge, Former Chief Financial Officer and current CEO Kent Britton, and other senior management.
According to the report, this policy was approved by Strawbridge, "without additional oversight and approval from the Audit Committee or Port Commission."
The port previously told 6 Investigates members of the Audit Committee voted on changes to this policy. 6 Investigates has asked the port to clarify this statement and they told 6 Investigators that:
The Audit Committee is a committee comprised of three Port of Corpus Christi Commissioners. While they offer insight and reactions in discussion on financial items, they have no formal approval authority; nor do any of the other committees. The audit report was presented to the audit committee but was not formally approved by the committee or board, an action Weaver is recommending, moving forward.
In reviewing the most recent policy, advisers "identified areas in which the policy was not explicit to define the allowability and appropriateness of certain transactions often used by Port Executives and Commissioners."
The audit also revealed that expense reports "are not consistently approved by the appropriate individuals according to the Port's policies and procedures."
Current policy requires expenditures made by the CEO and commissioners be approved by the Chair of the Audit Committee. However in several instance Port Chairman Charles Zahn approved purchases.
Following this review, 16 recommendations were made to enhance this policy.
"They basically told us that all our travel expenses or most of our travel expenses were within our policy at the time, but they did make recommendations on how we can improve our travel policies going forward," Commissioner and chair of the Audit Committee for the Port of Corpus Christi David Engle said last month following a presentation of this audit.
Tuesday, Engle said the port's policy was within the parameters of other Texas ports and special interest districts.
Britton said that in general, port leadership agrees with the findings of Weaver and Tidwell and that some of the recommendations had already been implemented. He also asked the port commission to review and approve any changes to the policy annually.
Commissioner Diane Gonzalez, an outspoken critic of port spending, said Tuesday was an important day at the port.
"Today is a long time in coming, it's an important list of ethical reforms," she said. "We are mindful the public and taxpayer deserve to have accountability, open government and transparency."
