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An Audit Report on The Port of Houston Authority's Promotion and Development Fund
January 2002
Report Number 02-019
Overall Conclusion
The Port of Houston Authority's (Authority) monthly reports on expenditures from its Promotion and Development Fund (Fund) contain the required elements (check number, amount, payee, and general purpose) for each expenditure and provide a reasonably accurate picture of Fund activity.
However, some expenditures from the Fund, such as for golf outings and receptions,
would have been questionable if paid with State funds. (The Authority is not
subject to state purchasing laws and regulations, and these expenditures appear
to be consistent with the purpose of this Fund.) Other expenditures, such as
for an employee picnic, do not appear to be directly related to promotion and
development. Many of the expenditures are routine and operational in nature.
The statute states that expenditures from the Fund are to be for "unusual
purposes and occasions" not covered by other law. The Authority's current
interpretation may not be consistent with this aspect of the law.
Key Facts and Findings
- Texas Water Code, Chapter 60, allows the Authority to set aside up to 5
percent per calendar year of its gross income for promotion and development
of the port. In calendar year 2000, the Authority transferred approximately
2.6 percent of its gross income from operations into the Fund.
- For the two-year period ending August 31, 2001, the Authority wrote approximately
3,200 checks totaling $7 million from the Fund. Most of the expenditures were
for advertising and professional fees and services.
- There are opportunities for the Authority to strengthen controls over the
use of the Fund, including ways to improve the monthly reports provided to
the Harris County Auditor.
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