Officials from the city of Somerset and state Auditor Adam Edelen's office agreed Thursday to go forward with an audit of the city's finances and other issues.
The Somerset city council voted 9-3 Monday to authorize a lawsuit against Edelen over the audit.
Attorneys for the city had disputed that his office has authority to do the examination.
On Thursday, however, the city's attorney, Charles D. Cole, said in a news release that the city and Edelen's office had agreed to "diligently work together" to finish the audit in a reasonable amount of time and in a way that did not disrupt city operations.
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Cole said Edelen's office had confirmed Edelen's special exam did not concern the city's ability to operate a gas station that competes with private retailers.
That program has been popular with many drivers who think it has driven down gas prices, but it also has drawn criticism that it is an improper government interference with private enterprise.
Edelen's office had made clear after the city council's vote that the special exam was not aimed at shutting down gas sales.
He said Thursday that he was not interested in the issue of whether the city legally may sell gas.
"I am interested, however, in carrying out my mission as auditor of public accounts by making sure the city's taxpayer dollars are being spent by the city wisely and with appropriate accountability and transparency, which includes the auditor's examiners asking questions of city employees and officials about gasoline sales as a part of the city's overall financial activity, internal controls, and policies and procedures," Edelen said.