Investigation Uncovers Systematic Abuse in Water Department and Airport Operations

MOUNT OLIVE. NC — The North Carolina State Auditor’s Office has released findings from an investigation into the Town of Mount Olive, revealing significant financial irregularities and employee misconduct that cost the municipality over $210,000 in lost revenue.

The investigation, launched following allegations received through the auditor’s tipline, focused primarily on the town’s Water Department and Municipal Airport operations, uncovering a pattern of systematic abuse and financial mismanagement.

Water Department Violations Highlight Internal Controls Failures

The audit revealed serious misconduct within Mount Olive’s Water Department, where a town employee routinely manipulated the utility system for personal benefit and selective enforcement.

According to the findings, a water department employee systematically voided hundreds of cutoff fees on a monthly basis and manipulated the system to prevent disconnection of her own unpaid water service. The employee’s actions demonstrated a clear abuse of access and authority within the department’s billing system.

The investigation also uncovered preferential treatment for a town commissioner who failed to pay utility bills for months without facing disconnection consequences. The commissioner accumulated a balance of $942, with cutoff fees being voided nine times within a single year period.

Utility Rate Errors Cost Town Significant Revenue

Beyond individual misconduct, the audit identified systemic issues with utility rate management that resulted in substantial financial losses for the municipality.

Improperly entered utility rates cost Mount Olive more than $210,000 in lost revenue, highlighting deficiencies in the town’s financial oversight and rate-setting procedures. These errors suggest inadequate internal controls and review processes for critical revenue-generating operations.

Airport Fuel Purchasing Violations Identified

The investigation extended to Mount Olive’s Municipal Airport operations, where auditors discovered multiple violations related to fuel purchasing agreements and financial oversight.

The town was found to be purchasing fuel that the airport operator was contractually obligated to buy, creating unnecessary municipal expenses and potential contract violations. Additionally, the audit identified unverified monthly commission invoices, indicating insufficient documentation and approval processes for airport-related expenditures.

Town Implements Immediate Corrective Measures

In response to the audit findings, Interim Town Manager Glenn Holland announced a series of immediate corrective actions designed to address the identified issues and prevent future occurrences.

The town has terminated three employees who were specifically identified in the audit report, with these terminations occurring prior to the official release of the investigation findings. Mount Olive has also ended the problematic fuel purchasing practices at the municipal airport.

As part of its financial oversight improvements, the town has appointed a bonded finance officer and plans to hire a certified public accountant to reconcile bank statements and update financial records. These measures are intended to strengthen internal controls and ensure proper financial management going forward.

Officials Emphasize Commitment to Reform

Holland emphasized that the town is taking the audit findings seriously and working proactively to resolve all identified issues. “We ask for the public’s patience as we daily work on resolving the remaining issues,” Holland said, requesting understanding during the remediation process as the municipality works to implement necessary changes and restore proper financial controls.

State Auditor Dave Boliek acknowledged that local officials have agreed with the investigation’s findings and stressed the critical importance of implementing the recommended changes to prevent future misconduct and financial losses.

The comprehensive response from Mount Olive officials suggests a commitment to transparency and reform in the wake of the damaging revelations about municipal operations and employee conduct.