Two weeks after audit, Lancaster County treasurer works to make corrections

It’s been two weeks since Nebraska Auditor Mike Foley released a report detailing what his office says are over a billion dollars in errors within the Lancaster County Treasurer’s and Clerk’s offices. And now, the treasurer’s office is working to make needed corrections.

The office collects property taxes to be distributed to schools, fire districts, cities and villages. It also oversees motor vehicle registrations and titles in partnership with the Nebraska Department of Motor Vehicles.

Treasurer Rachel Garver — a county elected official — was cited in the report for a mishandling of funds.

Garver said the errors cited stemmed from “misstatements in our semiannual reports.” Those “misstatements” were in published semi-annual statements between June 2025 and December 2025.

According to the report, when the treasurer’s office distributed funds, transactions were logged twice for both the collection and payouts. That’s what contributed to the billion dollar number.

To amend previous errors and prevent future problems, the office is redoing its most recent semiannual report.

“Their interpretation is you only should count the money once,” Garver said. “So we're going to be working on that…We're going to look at the past report and use that because we don't have a lot of time to create the report.”

Mishandling of funds happened across multiple accounts — from overpayments to local taxing entities and a $1.2 million underpayment to the state from 2023 to 2025, according to the auditor’s office, which said those issues happened due to an improper distribution of property tax credit money revenue.

“...It was dispersed at 100% and it should have been disbursed at 99%,” Garver said.

That 1% is what needed to be handed over to the state.

Since certain months get higher revenue than others due to distribution dates, Garver said her team went back and got the money at a time when an extra grab of cash wouldn’t hurt those entities.

“It wasn't going to be to anybody's detriment or hurt anybody's bank accounts or whatever,” Garver said. “It was going to cause the least amount of damage.”

Foley’s team also found the treasurer’s office withheld a 1% commission rather than 2% for the Airport Authority, which is set by state statute. It resulted in an overpayment of over $214,000 to the entity that started levying property taxes in 2022.

To fix that error, Garver said it meant updating the software for that entity and a few others to make sure Lancaster County is getting a 2% commission.

Garver said moving forward the office wants to continue updating software to provide further clarity.

“This really isn’t rocket science,” Foley said in his Sept. 15 press release. “State statute requires a 2% commission to be received, but the County Treasurer retained 1% instead. Like the other errors identified, the mistake wasn’t realized until my staff brought it to the office’s attention.”

Other issues included overpayments from duplicate distributions of motor vehicle rental taxes. That resulted in overpayments of $404,000 to Lincoln Public Schools, $148,000 to the Lancaster County general fund and $121,000 to the city of Lincoln.

Those errors were corrected in 2025; however, errors from 2022 through 2024 weren’t corrected until March 2026, according to the audit.

Looking ahead

At a Lancaster County Board staff meeting Thursday, Dennis Meyer, the county’s budget and fiscal officer, brought forward suggestions and corrections to the commissioners. He’s been leading the effort with Garver to make necessary changes.

His plan is to bring in an outside team to handle accounting for the treasurer’s office. Currently, the position for an accountant in that office is unfilled after a recent vacancy. Garver described the vacancy as “working from scratch.”

“So it sounds like what we're talking about is the pressure test. So basically, just did the corrective actions that are required that we've said we're doing actually get completed? Getting accounting support because we're down a position in the treasurer's office,” Commissioner Chelsea Johnson said.

The County Board also thought big picture at the Thursday meeting. Commissioner Sean Flowerday recommended supporting legislation to add qualifications for both the county treasurer and the county clerk.

He proposed adding an educational requirement for clerks and treasurers in counties with over 150,000 inhabitants.

“This is a proposal. I'm not married to anything here. We can discuss it. Everything can be changed if we want,” Flowerday said.

As these corrections are underway and the Lancaster County Board thinks about the future, Foley’s made it clear he’ll check in soon.

“While Lancaster County has publicly claimed that corrective actions are already underway, my office will return to conduct a follow-up examination to independently verify that such corrective actions were, in fact, fully implemented, and major errors, such as those identified during our recent examination, do not continue to persist,” Foley wrote in the letter sent to commissioners Sept. 17.