City of Fort Smith ’disbursement’ errors noted in draft audit report

Fort Smith attorney Joey McCutchen is again pressing the issue of what he says is inappropriate spending by Fort Smith Mayor George McGill. An Arkansas Legislative Audit (ALA) report found “disbursement” errors and recommended the city come into compliance with state law.

McCutchen said during a Monday (May 4) afternoon news conference that criminal charges should be considered.

The ALA report, identified as a draft report, did not identify or suggest criminal behavior or charges, and the city of Fort Smith and Mayor McGill pushed back against McCutchen’s suggestion that the errors should be criminally pursued.

“Recent allegations made in connection with a legislative audit are both misleading and inaccurate,” McGill noted in a statement. “The audit in question did not find any misappropriation, misuse, or unlawful diversion of public funds by me or by the city administration. The findings identified administrative errors and documentation omissions, but do not constitute criminal conduct.”

The ALA report, posted April 3, reviewed transactions by the mayor’s office between Jan. 1, 2024, and Oct. 7, 2025. During that time, the audit identified $170,007 in spending through the mayor’s office that did not have “a contract for services or documentation to support a public purpose …” in conflict with state law. The spending in question supported nonprofits in the city, including the Arkansas Colleges of Health Education, the Fort Smith Boys and Girls Club, Fort Smith Symphony, Steel Horse Rally, Hamilton Center for Child Advocacy, Girls Inc. of Fort Smith, the Fort Smith Roundtable/Juneteenth, Mercy Health Foundation, and the Fort Smith Museum of History.

The ALA report included only the following recommendation: “ALA recommends the City ensure disbursements area in compliance with Ark. Const. art. 12 § 5, and that all disbursements serve a governmental function and public purpose.”

McCutchen, also a leader in an effort to change the city’s form of government, said he plans to ask the ALA to expand the investigation and review spending in every year McGill has been mayor. He also said the Fort Smith Board of Directors should investigate the issue, claiming the city administration and legal counsel, provided by the Daily & Woods law firm, should have known such spending required proper documentation.

“The bottom line is that these are taxpayer dollars. Our law says you can’t do that,” McCutchen said, adding that he wants to know “who knew what, and when.”

McCutchen also floated the idea of requiring the nonprofits to return money received from the mayor’s office. McCutchen said the issue is being investigated by the Arkansas Attorney General’s Public Integrity Unit.

“We cannot confirm or deny any active investigations involving the city of Fort Smith at this time,” said Jeff LeMaster, communications director for Arkansas Attorney General Tim Griffin.

The ALA report is expected to be reviewed by the Legislative Joint Audit Committee of the Arkansas Legislature. Sen. Jim Petty, R-Van Buren, is Senate chair of the committee. The next committee meeting is set for June 4, but the city of Fort Smith audit does not appear on the agenda.

McCutchen’s new claims against the mayor and city follow a February 2025 order in which plaintiff Jimmie Cavin, represented by McCutchen, and the city of Fort Smith agreed to a settlement related to spending through the mayor’s office. The civil lawsuit and subsequent order were filed in the Sebastian County Circuit Court.

Following are the complete statements from the office of Mayor McGill and from the city of Fort Smith.

• Statement from the mayor’s office
Recent allegations made in connection with a legislative audit are both misleading and inaccurate. The audit in question did not find any misappropriation, misuse, or unlawful diversion of public funds by me or by the City administration.

The findings identified administrative errors and documentation omissions, but do not constitute criminal conduct.

At no point were public funds used for personal gain or for any purpose outside of their intended public benefit. All funds referenced in the audit were directed toward community purposes, including support for established nonprofit organizations that provide essential services to our city’s residents. These organizations play a vital role in areas such as youth development, public health, education, and assistance to families in need. 

We take the audit findings seriously and have already taken steps to strengthen internal processes, improve documentation procedures, and ensure full compliance moving forward. We accepted the auditor’s recommendation that the city ensure that disbursements comply with Article 12, Section 5 of the Arkansas Constitution and that all disbursements serve a governmental function and a documented public purpose. 

It is unfortunate that these administrative matters are being mischaracterized. We remain committed to transparency, accountability, and responsible stewardship of taxpayer dollars. We will continue to focus on serving the people of this community with integrity and dedication.

• Statement from the city of Fort Smith
The City acknowledges the Arkansas Division of Legislative Audit’s findings regarding selected 2024 City transactions and recognizes that certain expenditures lacked the required documentation of a governmental function or public purpose under Article 12, Section 5 of the Arkansas Constitution.

However, the City maintains that these expenditures did not constitute misappropriation or theft. The issue was one of documentation and constitutional compliance, not personal gain or criminal intent.

Once the City became aware of the compliance issue, it took action to address it. The City agreed not to provide funds to private entities in violation of the constitutional provision, reduced the related Special Events line item, and continues to review purchasing policies and procedures to ensure that future expenditures are properly documented, tied to a public purpose, and, when required, approved by the Board through an appropriate public services agreement.