The Counties and Municipalities Committee spent Thursday morning circling a familiar problem — until it stopped circling.

Legislative Audit, Counties and Municipalities Committee
January 8, 2026

💰 The Finding

Legislative auditors found the City of Daisy improperly spent $42,731 in restricted street funds in 2021 and 2022.

According to audit staff:

• $25,731 was used to purchase a fire truck
• $17,000 was used for construction of a fire department building

Both expenses violate state law limiting how street funds may be used.

Auditors also flagged:

• $2,000 paid in 2023 and $2,000 paid in 2024 to a nonprofit for fireworks
• No contract for services, placing the payments out of compliance with the state constitution

🏛️ “The Council Won’t Approve It”

Mayor Lisa Cogburn told the committee she has repeatedly taken the repayment issue to her city council and repeatedly been rejected. She said the council doesn’t think the city actually owes what the state claims. The mayor posited the council might be willing to approve a lesser amount.

Sen. Matt Stone pressed the logic.

“Why would you agree to pay an amount that you don’t owe?” he asked. “That just doesn’t add up.”

Audit staff said the $42,731 figure comes directly from audited records and remains unchanged absent documentation to the contrary.

⚖️ Not Up for Debate

Committee members made clear that disagreement does not override audit findings.

“This is not a negotiation,” Sen. Mark Johnson said. “This is something that’s found by auditors and we expect it to be fixed.”

Chairman Richard Womack warned the committee was nearing its final enforcement option.

“It’s my understanding that we’re to the point where we have to decide whether we stop their turnback funds until there’s compliance,” Womack said.

Cogburn acknowledged the council may not grasp the stakes.

“I don’t think that they understand that,” she said.

🔨 The Vote

Audit staff explained that state law requires repayment of 10 percent of unrestricted general revenues, not 10 percent of the total owed.

For Daisy:

• Acerca de $228 per month
• Roughly $2,300 per year

Cogburn confirmed the town can afford the payments.

“Yes, sir,” she said.

The committee voted to:

• Require Daisy to begin the 10 percent repayment immediately
• Withhold street turnback funds if payments are not made

🧾 Before Moving On

Before the vote was finalized, Cogburn offered an apology.

“I apologize on my city for being so hard-headed and not wanting to approve,” she said.