An audit of a city of Dayton department targeted in a federal corruption investigation found city staff operated with too little oversight but uncovered no evidence of widespread impropriety, according to an executive summary of the audit the city provided the Dayton Daily News.
Dayton city leaders declined to release the full audit conducted by the local law firm Green and Green, saying it is protected from disclosure under Ohio public records law as attorney-client communication. The city paid the law firm $30,000 for the review.
The audit focused on whether the city’s Human Relations Council followed laws and proper processes in handling contracts and whether any other criminal activity occurred beyond what the FBI uncovered in a probe that led to corruption convictions against a city commissioner, city employee and vendors.
The city also paid the Westerville-based accounting and auditing firm Julian and Grube $42,000 to review the city’s procurement processes, identify risks and inefficiencies, and recommend improvements. The city released the outcome of that review this week.
The city produced a two-page executive summary of the Green and Green report for the Dayton Daily News after denying a public records request for the full audit.
The summary says the audit by attorney Thomas Green focused on improper or unethical behavior of former Human Relations Council employee RoShawn Winburn. Winburn — also a former Huber Heights city councilman — was sentenced in July to six months in prison after he was convicted of corruptly soliciting a bribe in return for giving confidential information to an individual seeking city contracts.
READ THE EXECUTIVE SUMMARY
Winburn was business and technical assistance administrator for the HRC and played a role in recommending companies to receive city contracts to meet goals for disadvantaged, minority- or women-owned businesses.
“The investigation did not reveal evidence of improper, unethical or criminal behavior,” the summary says. “However, it did reveal that the BTA administrator primarily worked alone, with little oversight or audit, providing the opportunity for improper behavior to occur.”
It also found Winburn maintained little documentation to back up important decisions involving bid award recommendations, the selection process or grievances submitted by disappointed bidders and subcontractors.
The review recommended added oversight and documentation.
City officials say the audit looked at city project files during the time period when the alleged illegal activity occurred, from 2014-2017, and none of the business and technical assistance staff from then are still employed by the city.
Human Relations Council Director Erica Fields, who started her position in January 2019, said they have made several improvements in recent years “designed to strengthen the program, internal controls and improve capacity to monitor the (disadvantaged business assistance) program.”
This included hiring an independent attorney for 10 weeks after the indictments to oversee and review disadvantaged assistance program procedures and provide recommendations to improve policy. Fields said they also updated policies and programs for monitoring disadvantaged business compliance and complaints from subcontractors.
The federal investigation focused heavily on the HRC and disadvantaged business programs. It resulted in former city commissioner Joey Williams pleading guilty to soliciting a bribe, former state lawmaker Clayton Luckie pleading guilty to mail fraud, and companies Steve Rauch Inc. and Green Star Trucking — owned by Steve Rauch and former Trotwood mayor Joyce Sutton Cameron. respectively — pleading guilty to mail fraud.
Dayton Mayor Nan Whaley said the Green and Green audit focused not on the people and incidents under investigation by the FBI but whether other city employees were breaking the law.
“The reason why we did the report was to make sure there was no other criminal wrongdoing, and they found there was none,” she said in an interview this week. “That was the most important thing to us as a commission.”
City Commissioner Darryl Fairchild said it was clear from the report that there wasn’t a “culture of corruption” — a term used by an FBI special agent when charges were announced — in the city.
“I remember seeing that these were isolated acts by individuals and that there were some places where we could improve some of our oversight and controls,” he said.
The executive summary says Green provided reports to the city in June and November 2019. The reports weren’t presented to the full city commission or discussed at a meeting, but the law director briefed each city commissioner on the findings individually, city officials said.
Whaley said this is common at the suggestion of the city law department in instances involving attorney-client privilege where the city could be exposed to liability.
When the Dayton Daily News requested the full audit in November, the city commission considered waiving attorney-client privilege and releasing the full audit. They decided against it and provided only the executive summary instead.
Whaley said that was done, despite the fact they say there was no evidence of wrongdoing, because the law department didn’t want to set a precedent.
“We don’t release any full audits that are from the law department, so we didn’t want to set precedent in that way,” she said.
The city did release the findings of the Julian and Grube review this week in response to a Dayton Daily News public records request.
That firm reviewed 11 city departments and released its recommendations in February 2020. The report calls for general standardization of procurement processes and more oversight, particularly by the city’s procurement division. This includes the creation of a “procurement oversight board.”
READ THE JULIAN AND GRUBE REVIEW
The report recommends the city create a robust vendor database that tracks whether vendors have outstanding issues with other city contracts, and also increase its pool of demolition contractors.
The FBI’s investigation focused on demolition contractors — they named the project “Operation Demolished Integrity” — and those indicted included a demolition company and subcontractor, and city officials involved in demolition contracts.
The report called for an annual internal audit of selected demotion projects to ensure compliance and continued oversight by the Human Relations Council.
The report also recommended more strict guidelines for no-bid contracts.
“The task force found that overall the city’s process were in compliance and had a high level of checks and balances in comparison with industry standards,” said city spokeswoman Toni Bankston in an emailed statement. “Since the review some recommendations have already implemented.”
Specifically, she said they created a new online bidding processes, including a new process for soliciting demolition contracts.
Bankston said the city is working toward implementing all of the recommendations, but some of that work was slowed by the coronavirus pandemic.
“Implementing the recommended changes will be part of our focus this year,” she said.
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