Cary, NC put a P-Card in 62% of workers' hands -- 4x its NC peers

The North Carolina Office of the State Auditor⧉ -- the constitutional office with statutory authority to investigate any publicly funded entity in the state -- spent eight months examining the Town of Cary's finances after Council members alleged financial misconduct by then-Town Manager Sean Stegall.▸ Its July 16, 2026 report found 828 of Cary's 1,328 employees hold a Town procurement card, a 62% issuance rate nearly four times the 16% average OSA found among North Carolina's nine other most populous cities. Those cards moved $24.2 million in two years. Separately, the audit found the Town's Fund Balance -- its legally required emergency reserve -- fell $10.4 million below the minimum its own policy sets, even as Stegall repeatedly told the Council it never had.

To gauge whether Cary was an outlier, OSA surveyed P-Card issuance at North Carolina's ten most populous municipalities as of May 2026.▸ Charlotte, the state's largest city with 9,036 employees, had issued 873 P-Cards -- 10% of its workforce. Cary, with 1,328 employees, had issued 828: nearly as many active cards as Charlotte despite having one-seventh the staff, putting 62% of its own workforce on a Town card. OSA's report states plainly that the Town's high number of P-Cards "increases the opportunity for fraud and wasteful spending."

Some of what surfaced was ordinary municipal overhead; some wasn't. The Town paid ghostwriter Seth Kaufman $65,653 to write Stegall's book, Top of the Arc, published in August 2025 -- by May 2026 it had sold 266 copies against 2,309 still in inventory.▸ Mayor Harold Weinbrecht told investigators the Council believed Stegall was paying for it himself. A single 2024 staff retreat in Wilmington ran up $121,313.75 in video-production costs, including a $34,975 documentary about a staff dance routine performed for Stegall. And Stegall charged $3,419 for a solo penthouse stay at Hotel Van Zandt, writing on the Town's Lost Receipt Form that the charge was for "hotel for multiple staff" and that he couldn't "remember who booked" it -- OSA obtained the itemized receipt directly from the hotel and found he was the only Town employee who stayed there.

The Town also paid a combined $1,073,550 for two adjoining land parcels -- $387,980 and $685,570 -- bought in separate transactions because each had a different owner.▸ Purchases over $1 million otherwise require Council approval; OSA found the Town Manager and Deputy Town Manager had no spending cap of their own, so the threshold never applied regardless of how the purchases were split. A former Assistant Town Manager had already told a councilmember, in writing, that the land wasn't worth buying and the Town had no use for it.

OSA focused its closest review on the 22 employees closest to Stegall; 18 of them held their own P-Card and together spent $701,857 on 2,074 transactions over the two-year window.▸ Of 619 of those transactions pulled for detailed review, totaling $548,135, 45 receipts were not itemized ($64,363) and 76 transactions had no receipt at all ($37,963) -- $102,326 combined, about 18.7% of that reviewed sample, that the Town cannot document.

Cary's own Fund Balance Policy, in effect since September 2020, requires an emergency reserve equal to at least 33.33% of budgeted General Fund expenditures -- money usable only at the full Council's discretion in a declared emergency.▸ OSA's review of the Town's audited financial statements found revenue grew $81 million (41%) from FY2021 through FY2025, while spending grew faster still -- $99.8 million, or 60% -- producing operating deficits of $8.5 million in FY2023 and $27.2 million in FY2024. Measured against the Council's final adjusted budget, which OSA says is the GAAP-aligned basis, the Fund Balance fell $8.5 million short of the minimum in FY2023 and $10.4 million short in FY2024. The Town's own math, using the original adopted budget instead, showed a smaller $3.1 million shortfall in FY2023 and claimed a $4.4 million surplus in FY2024 -- a $14.8 million gap between what Town officials told themselves and what auditors found. At a November 2025 Council meeting, Stegall stated multiple times that the Fund Balance had never fallen below its minimum.

Stegall resigned on December 13, 2025, after being placed on leave three weeks earlier.▸ The Town had agreed to pay him a $194,832 severance -- six months' salary -- on the condition he return Town property and provide access to his business text messages; Town officials say he refused, so he was not paid it. On January 23, 2026, OSA briefed the Wake County District Attorney and the State Bureau of Investigation on purchases that appeared potentially fraudulent -- a referral North Carolina law requires⧉ whenever the Auditor believes it has evidence of criminal misconduct.