Mendoza said it is because the village isn't being transparent with its financial situation.
"Until I see those reports properly filed the way, the law says they have to be, and until we see them show accountability for how they are spending taxpayer money, they will not see another penny of those offsets," Mendoza said.
Mendoza said she is freezing $135,000 that would have been sent to Dolton after a preliminary report of the village finances by former Chicago Mayor Lori Lightfoot revealed questionable expenses under Mayor Tiffany Henyard, and a village that had a multi-million dollar surplus two years ago is now running millions of dollars in debt.
READ MORE | Lightfoot investigation found some Dolton police officers received staggering overtime pay
"Our action yesterday is to protect the people of Dolton, who she is disrespecting with her behavior every day," Mendoza said.
Mendoza says her office is poised to conduct a forced audit and levy fines if the Village of Dolton does not file past due audits. Village trustees are now demanding that the village finance department comply.
"It's so sad. It's sad, because the people who are being hurt are the poor people of Dolton," Mendoza said.
An attorney representing Henyard shared statement, saying in part, "She has never refused to comply with the Comptroller. She is simply trying to compel the accountant to comply."
Meanwhile, on Thursday, there was more confusion over leadership at the Dolton Police Department after the trustees put Deputy Chief Lewis Lacey on administrative leave.
SEE ALSO | Dolton general fund $3.65M in debt, down from surplus of $5.6M when Henyard took office: Lightfoot
Lacey appeared in federal court on Thursday, pleading not guilty to charges of bankruptcy fraud and lying under oath. A judge ordered him to hand over his firearms and FOID card.
In a video obtained by ABC7, Lacey and Henyard were heard telling officers who is in charge on Thursday night.
"Now, from this point on, do what you want, but anything after this is insubordination," Lacy said.
Attorney Burt Odelson represents village trustees.
"I've seen a lot of corruption and hijinks, and I've never seen anything like this," Odelson said.
Dolton trustees told ABC7 they will move to formally fire Lacey at the next village board meeting after they say he violated the terms of his administrative leave.