Agenda 06/24/2014 Item #16J46/24/2014 16.J.4.
EXECUTIVE SUMMARY
To provide to the Board of County Commissioners the Clerk of the Circuit Court's
Internal Audit Report 2014 -9 Job Creation and Job Retention Agreements: Haynes
Corporation, issued on June 18, 2014.
OBJECTIVE: To provide the Board of County Commissioners (Board) the issued Audit Report
2014 -9 Job Creation and Job Retention Agreements: Haynes Corporation.
The Audit Report was presented to the Board on Thursday, June 18, 2014, and is available
electronically on the Clerk of Courts website.
The Clerk's website for published Internal Audit Reports, once they are no longer confidential:
Report:
https• / /www colliercierk com/resource- library//pdf /internal- audit -pdf /2014 -9- business -and-
economic- development
Internal Audits do not become public record until delivered to the Board by the Clerk's Office.
GROWTH MANAGEMENT IMPACT: None
FISCAL IMPACT: None
RECOMMENDATION: That the Clerk's Audit Report 2014 -9 Job Creation and Job Retention
Agreements: Haynes Corporation, be entered into the record.
Prepared by: Patrick Blaney, Senior Internal Auditor
Office of the Clerk of the Circuit Court
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COLLIER COUNTY
Board of County Commissioners
Item Number: 16.J.4
6/24/2014 16. J .4.
Item Summary: To provide to the Board of County Commissioners the Clerk of the Circuit
Court's Internal Audit Report 2014 -9 Job Creation and Job Retention Agreements: Haynes Corporation,
issued on June 18, 2014.
Meeting Date: 6/24/2014
Prepared By
Name: patblaney
Title: Sr. Internal Auditor
Approved By
Name: crystalkinzel
Title: Finance Director
Date: 06/18/2014 07:25:10 AM
Name: klatzkowjeff
Title: County Attorney,
Date: 06/18/2014 08:37:41 AM
Name: markisackson
Title: Director -Corp Financial and Mngmt Svs, Office of Management & Budget
Date: 06/18/2014 09:00:30 AM
Name: durham_t
Title: Executive Manager of Corp Business Ops,
Date: 06/18/2014 11:07:15 AM
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6/24/2014 16.J.4.
COLLIER COUNTY
Board of County Commissioners
Item Number: 16.16.J.16.J.4.
Item Summary: To provide to the Board of County Commissioners the Clerk of the Circuit
Court's Internal Audit Report 2014 -9 Job Creation and Job Retention Agreements: Haynes
Corporation, issued on June 18, 2014.
Meeting Date: 6/24/2014
Prepared By
Name: BlaneyPat
Title: VALUE MISSING
6/13/2014 12:19:31 PM
Approved By
Name: KinzelCrystal
Date: 6/1 8/2014 7:25:10 AM
Name: KlatzkowJeff
Title: County Attorney,
Date: 6/18/2014 8:37:40 AM
Name: IsacksonMark
Title: Director -Corp Financial and Mngmt Svs, Office of Management & Budget
Date: 6/18/2014 9:00:29 AM
Name: DurhamTim
Title: Executive Manager of Corp Business Ops,
Date: 6/18/2014 11:07:14 AM
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2
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7-M
6/24/2014 16. J .4.
Internal Audit Department
Audit Report 2014 -9
Business and Economic Development
Job Creation and Job Retention
Agreements: Haynes Corporation
Issued: June 18, 2014
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6/24/2014 16.J.4.
Prepared by: James D. Molenaar, Internal Audit Manager
Patrick Blaney, Senior Internal Auditor
Report Distribution: Board of County Commissioners
Leo Ochs, Jr., County Manager
Bruce Register, Director, Business & Economic Development
Amy Patterson, Manager, Impact Fees & Economic Development
Cc: Dwight E. Brock, Clerk of the Circuit Court
Crystal K. Kinzel, Director of Finance & Internal Audit
Table of Contents
Summary............................................................................... ............................... 2
Objective................................................................................ ..............................2
Scope.................................................................................... ..............................2
Background............................................................................ ............................... 3
ManagementResponse ................................................................ ..............................3
Concl usion.............................................................................. ..............................3
�Ndorknapers suppot i ,y the obs r� ,at ions noted tvitliin t1iis report are public record and can be rnade available
upon request once the final audit report leas been issued. Tne files and draft versions of audit reports remain
confidential and protected firorn public records requests during an active audit under �= icvl�Ii v.
28, 19 98 DC 4 of °FL. 5"' Disfrico and Section 119.0713. Florida Statutes.
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6/24/2014 16.J.4.
Internal Audit provided draft Audit Report 2014 -9 to the Business and Economic Development Director and the
Impact Fee Manager for management response on May 27, 2014. The Business and Economic Development
Director provided the management response on June 4, 2014.
This review generated the following observations for Collier County's Job Creation and Job Retention Incentive
Agreements with Haynes Corporation:
• Haynes Corporation was visited to examine employee records.
• Payroll and personnel records were reviewed for Job Creation eligibility. Names, hire dates, job titles, and
wages were noted for all employees in created jobs. Wages were averaged for all jobs created, and compared to
the requirements of the Job Creation Incentive Agreement.
• The original 37 retained employees who were validated in 2011 were compared to Haynes' employee census as
of July 31, 2013. Twenty -six original employees remained, and eleven replacements were selected. For those
eleven, personnel records were reviewed for Job Retention eligibility. Per the terms of the agreement, names,
hire dates, and employment as of July 31, 2013, were noted.
• Because both Agreements contained residency restrictions, the addresses of all employees filling eligible jobs,
both original and replacement, were confirmed to be in Collier County.
• Although not required under these Incentive Agreements, the I -9 status of every replacement employee was
verified. The original employees' 1 -9 status had been verified in 2011.
• These tests validated that Haynes exceeded its Job Creation residency and average wage requirements for 17
jobs, and that Haynes had retained 37 jobs filled by Collier County residents.
The objective of the engagement was to validate the number of eligible jobs created and retained in accordance with
Haynes' Incentive Agreements with Collier County.
This examination consisted of validating jobs, residency, and wages, including, but not limited to, the following:
• Reading Collier County's Job Creation and Job Retention Incentive Agreements with Haynes Corporation,
• Reviewing sections 125.045, 288.075, and 688.02, Florida Statutes;
• Examining payroll and personnel records at Haynes Corporation;
• Visiting Haynes Corporation and interviewing applicable management;
• Substituting replacement employees, as needed, for original employees who had since terminated;
• Scheduling payroll and personnel data for all employees holding jobs claimed as created;
• Averaging annual wages for created jobs by reporting year; and
• Listing personnel data for replacement employees holding jobs claimed as retained.
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6/24/2014 16. J .4.
Haynes Corporation applied to the County Manager for economic incentives, including Job Creation and Job
Retention, in 2010. The ordinances providing for economic incentives expired on October 1, 2013, before the Board
of County Commissioners (BCC) had approved Haynes' participation in the economic incentive programs. In June
2013 the BCC directed County management to prepare economic incentive agreements with Haynes. At its
December 10, 2013, regular meeting, the BCC approved Job Creation and Job Retention Incentive Agreements with
Haynes.
Under the terms of the Job Creation Incentive, the County will pay Haynes $2,000 per job, spread over three years,
for up to 17 new jobs created. The jobs must average at least $34,320 in annual wages, and be held by Collier
County residents.
The Job Retention Incentive provides $1,000 per job to Haynes for up to 37 jobs retained from the time it applied
through September 30, 2013, and held by a Collier County resident. The $1,000 incentive is to be paid over three
years, pending verification of the jobs retained.
With the Impact Fee & Economic Development Manager, Internal Audit validated jobs created in accordance with
the Job Creation and Job Retention Incentive Agreements. This report describes the results of that validation.
`I have reviewed the submitted Audit Report #2014 -9 regarding Haynes Corporation's compliance with incentive
criteria established by Job Creation' and Job Retention Agreements in place with Collier County. I concur with the
audit findings and consider the Haynes Corporation currently in compliance with the obligations within the Job
Creation and Job Retention Agreements up to September 30, 2013.
Staff appreciates the professional and pragmatic approach exhibited by the Internal Audit Department for this
performance validation process. "
Due to Haynes Corporation's compliance with the requirements of its Job Creation and Job Retention Incentive
Agreements with Collier County, there are no adverse observations to report.
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