State Auditor Beth Wood had three words for a recent audit of the town of Princeville’s finances: “It’s pretty bad.”

Monday, Wood’s office released an investigative report that slapped the town’s mayor, former interim town manager, and a town commissioner for questionable expenses and loose recordkeeping.

The audit found that Mayor Priscilla Everette-Oates used the town credit card for questionable expenses from August 2010 to July 2012.

“The majority of the charges did not have a clearly documented business purpose,” the report says.

The report says most of the explanations were vague. “For example, the mayor listed ‘vehicle fuel’ as the business purpose for most gas station charges,” it says. “There is no mention of where the vehicle was driven or for what town purpose.”

Among charges on the mayor’s credit card were:

• Twenty-two visits to Madison Seafood, totaling $1,255.

• Eleven visits to Crystal Palace, a Raleigh Chinese restaurant, totaling $848.

• Fifteen visits to Office Depot, totaling $1,137.

• Two visits to Bed, Bath & Beyond, totaling $222.

The mayor, a commissioner, and the interim town manager received check reimbursements of $4.112 for travel expenses without adequate supporting documentation, the report says.

The report lists seven pages of line-item expenditures without supporting receipts, or unnecessary late fees and finance charges.

Wood, who previously worked at the state’s Local Government Commission and for the auditor’s office, is in her second term as state auditor. She said she didn’t think she had ever seen a local government audit that had an “adverse opinion” with 19 material weaknesses.

“That’s the controls to make sure that you’re spending the town’s dollars the way they should be spent,” Wood said. “There were just no checks and balances to make sure that the finances were right.”

The report also chides the mayor for entering into contracts with an attorney and a consultant without obtaining a pre-audit from the town’s finance officer as required by state law.

Princeville’s own stationery notes that it is the “oldest town chartered by blacks in America.” It’s webpage chronicles how it was incorporated in 1885, 20 years after emancipated slaves crossed the Tar River from Tarboro in Edgecombe County and settled there.

In recent years, Princeville has had its difficulties. The audit notes that the state’s Local Government Commission has taken over the town’s finances twice, once in 1997 and once last year. The finances remain under the Local Government Commission’s control.

The audit recommends that the Local Government Commission retain control until matters found in the audit are addressed. It also recommends that town officials not approve credit card expenditures unless they are documented fully. It also calls for the town to develop and implement a comprehensive reimbursement policy and that it get pre-audit approval before entering into contracts.

The auditor’s office has sent its findings to the N.C. State Bureau of Investigation, the Edgecombe County District Attorney’s office, the Internal Revenue Service, and the N.C. Department of Revenue.

Three town commissioners — Gwendolyn Knight, Ann Howell, and Calvin Sherrod — responded to the audit, saying they accept the auditor’s recommendations. They said they planned to implement them as soon as the office is properly staffed and financial control is returned to the town.

Everette-Oates did not respond to a Carolina Journal request for an interview.

Barry Smith (@Barry_Smith) is an associate editor of Carolina Journal.