AUDIT UNCOVERS PROBLEMS IN CITY OF SPENCER

OKLAHOMA CITY, OK (November 13, 2025) Oklahoma State Auditor & Inspector [SA&I] Cindy Byrd today released her forensic audit report for the City of Spencer in Oklahoma County. Auditor Byrd launched the investigation after receiving a citizen petition from Spencer residents.

The petitioners requested a review of seven specific concerns occurring between July 1, 2016, and June 30, 2021.

“The City of Spencer has a systemic problem with basic oversight and compliance,” Auditor Cindy Byrd said. “Our investigators uncovered as much mismanagement as they could. However, the city’s recordkeeping was so shoddy and unorganized, their financial issues are likely much worse than this audit report shows.”

Among the problematic findings are:

Utility Billing

• Utility customers, including some council members, accumulated large unpaid balances, resulting in a total utility delinquency amount of more than $1.2 million.
• Utility records were inconsistent, incomplete, and unreliable.
• Among 25 city employees, utility account records were located for only four, and even those records were incomplete.
• Five of eight council members routinely missed utility payments and carried large unpaid balances. Council Members’ utility accounts were never cut off for non-payment.
• One council member failed to make a single payment over roughly four years and, at one point, had an unpaid balance of almost $8,000.

2020 Revenue Bond

• Expenditures totaling $523,728.04 were found to be non-compliant with the bond indenture and resolution.
• $211,790.68 in expenditures could not be evaluated due to insufficient supporting documentation.
• The city council reallocated sales and excise tax dedicated to the City to the Utility Authority without voter approval. Reallocating sales tax without a public vote of the people is a violation of law.

Payroll Taxes

• Beginning in 2010, the City failed to consistently remit taxes to the Internal Revenue Service. As of November 29, 2023, the outstanding balance owed to the IRS was $826,206.55.
• Between January 1, 2015, and March 31, 2019, the City consistently failed to remit tax payments to the Oklahoma Tax Commission. As a result, the City incurred $38,079.53 in penalties and interest.

Municipal Court

• Missing revenue from court fines and fees, for the six-month period reviewed, totaled $46,644.25.
• During FY 2019, several employees collected payments and issued receipts that were incomplete or improperly recorded. Records did not identify who was responsible for depositing the funds.
• From May through October of 2019, the city had a total cash shortage of $21,433.44 when comparing cash collected to cash bank deposits.
• Credit card payments totaled $148,219.76, while related credit card bank deposits totaled only $122,908.95, a shortage of $25,310.81.

“Ultimately, all responsibility for these problems falls on the members of the Spencer City Council,” said Auditor Byrd. “Whether the money comes from taxes, utilities, or court costs, council members bear ultimate responsibility for managing city revenue. The residents of Spencer deserve better.”

The findings of this forensic audit have been turned over to the Oklahoma County District Attorney’s Office.

This is the 92nd audit released by Cindy Byrd this fiscal year.

The full audit is posted here on the Oklahoma State Auditor & Inspector’s official website.