Louisiana, Missouri (KHQA) — ***UPDATE: Story now includes a response to the state auditor's statement from the mayor of Louisiana, Missouri.***

The city of Louisiana, Missouri is facing around a $70,000 fine from the Missouri State Auditor's Office for failing to submit their 2022-2023 End-of-Year financial report.

"The city's failure to submit the report timely to the State Auditor's Office occurred despite my office sending a reminder letter to each political subdivision each year; the Department of Revenue sending a certified letter 30 days in advance of the fines starting to accrue; and the city successfully filing its financial statements timely with my office in every other year, including for FY 2024, which was submitted correctly while the FY 2023 report remained missing," said Missouri State Auditor Scott Fitzpatrick in a statement to KHQA.

The original fine was $196,500 for not submitting the report until April 18, 2025.

Granted, the city did submit the report, just to the wrong department. They turned it into the Missouri Department of Revenue instead of the Missouri State Auditor's Office.

"In an effort to protect the tax dollars of the citizens of Louisiana, the state auditor's office has worked in good faith with the city to greatly reduce the total fine by backdating the date of receipt for the city's financial report to the date the city intended to send it to us, but failed to send it to the correct email address," said Fitzpatrick.

But they said they have no intention to waive the rest of the fines, because the fines are set by state law, and his office has no authority to waive that.

"Rather than spending time trying to assign blame for this failure, the city would be better served working to ensure it has policies and procedures in place to ensure an error of this nature cannot happen again," Fitzpatrick said. "Fortunately for the people of Louisiana, my office will soon release our full audit report for the City of Louisiana that will provide recommendations for how city officials can improve the effectiveness and efficiency of their city government."

The mayor of Louisiana still hopes they will be able to waive those fines and is in the process of reaching out to State Auditor's Office to do so.

As for the resident who brought the fines to light for Louisiana city council and the community:

"I hope to keep the citizens informed," said Mike Sherman. "I hope the city does an honest job at trying to be more transparent. And I want the citizens of Louisiana to know they have a voice.

Check back as KHQA will continue to cover this "community in crisis" on July 28th for their city council meeting.

Full statement from Missouri State Auditor Scott Fitzpatrick:

"The issues that have arisen in the City of Louisiana highlight the importance of the audit work done by my office as it was this process that questioned the city's enormous fine as a result of the city's failure to comply with our state's financial reporting laws. To be clear, the city failed to submit its annual financial report for the year ended May 31, 2023, to the State Auditor's Office until April 18, 2025. As a result, the Missouri Department of Revenue assessed fines totaling $196,500, which the department collected by withholding a portion of the city's monthly sales tax distributions. Neither the mayor nor anyone within Louisiana city government was aware of this fine and the withholdings made by the department until they were informed by my office.

Unfortunately, the fines are firmly fixed in state law at a rate of $500 per day and my office has no authority to waive the department's fines. However, in an effort to protect the tax dollars of the citizens of Louisiana, the State Auditor's Office has worked in good faith with the city to greatly reduce the total fine by backdating the date of receipt for the city's financial report to the date the city intended to send it to us, but failed to send it to the correct email address. This action reduced the total fine owed by the city by more than $120,000 to a final amount closer to $70,000. Again, these are the tax dollars of the people of Louisiana and it is through no fault of taxpayers that these funds have been diverted from essential services to pay for this fine, which is why my office has worked to reduce the fine amount by the maximum amount allowed by state law.

The city's failure to submit the report timely to the State Auditor's Office occurred despite my office sending a reminder letter to each political subdivision each year; the Department of Revenue sending a certified letter thirty days in advance of the fines starting to accrue; and the city successfully filing its financial statements timely with my office in every other year, including for FY 2024 which was submitted correctly while the FY 2023 report remained missing. The decision to backdate the report receipt date to August 21, 2024 reflects the fact that the city attempted to submit its annual financial report by sending it to an erroneous Department of Revenue email address rather than the State Auditor's Office. This occurred even though the city successfully submitted previous reports to my office and the numerous mailings make it clear the State Auditor's Office is the statutorily-required recipient. However, for the sake of taxpayers I have worked in good faith with the city to greatly reduce the fine by recognizing their intent to file.

For now, city officials need to understand my office has no additional authority to reduce or eliminate the remaining fine because even with the recognition of the August 21 submission date to the wrong entity, the city's filing of the financial report was still over 8 months late. Rather than spending time trying to assign blame for this failure, the city would be better served working to ensure it has policies and procedures in place to ensure an error of this nature cannot happen again. Fortunately for the people of Louisiana, my office will soon release our full audit report for the City of Louisiana that will provide recommendations for how city officials can improve the effectiveness and efficiency of their city government."

Full response from Mayor Tim Carter:

What was submitted in April 2025 was not the City's financial report. That report was actually submitted to the Department of Revenue (DOR) in August 2024. After speaking directly with Ms. Leanne Snodgrass at DOR, we were informed that DOR typically forwards such submissions to the State Auditor’s Office (SAO), as they are the agency responsible for assessing fines related to delinquent filings.

In this case, while our financial report was submitted late, it was provided to DOR—the entity assessing the penalties—rather than directly to SAO. We have requested a copy of the email or other documentation that shows the transmission of the report from DOR to SAO.

It is our belief that SAO would not unilaterally backdate fines without some documentation justifying that action. If SAO does, in fact, have the discretion to impose or waive penalties in such cases, then we respectfully urge them to waive these fines entirely in recognition of the fact that the report was submitted to a state agency and that no bad faith or willful neglect occurred. We believe such a waiver would reflect a fair and taxpayer-respectful application of their enforcement authority.