UPDATE: This post has been updated with new information.

A states audit (.pdf) released this morning found that the King County Ferry District lacked adequate internal control to make sure that its water taxi fares were being properly counted. The audit, which took place from Jan. 1, 2009 to Dec. 31, 2009, found that the district did not monitor to ensure whether its revenue met expectations or if ridership numbers matched dollar amounts reported.

The audit reported a specific incident last May, when a Marine Division employee was arrested after $7,500 in cash fare revenue and 26 safes with $9,000 in them went missing, amounting to a total loss of $16,500 for the district. "That's serious," said Mindy Chambers, spokesperson for the Washington State Auditor's Office. "It's really important for them to have the proper systems in place to protect public resources."

The Ferry District says that the theft occurred while the collected fares were under the control of its contractor, the King County Marine Division. The district's former Executive Director Hank Myers said in the audit that the Ferry District "lacked adequate resources or did not receive resources needed to monitor fare collections in a timely manner."

But King County Council Member Larry Gossett, chair of the King County Ferry District board, called Myer's statement unfounded and said that the district disagreed with the audit report. "We feel that we have adequate checks and balances in the district," Gossett said. "Just because an employee stole from the agency doesn't mean the agency doesn't have adequate controls." Gossett said that the agency had improved its fiscal management since the theft and was strongly monitoring cash revenues under the Marine Division. The Ferry District has also promised to do more internal audits of the Marine Division.

The Ferry District operates water taxies to Vashion Island, West Seattle, and downtown Seattle, among other locations. Established in 2007, its board of supervisors is represented by the King County Council.