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Letter: The Dots Don’t Connect

May 14, 2014 By David Anderson

Because Lakewood as much said so.

In expressing what appears as surprising ambivalence to an ongoing investigation into alleged financial misappropriation of funds at the Tillicum Community Center, David Bugher, Lakewood’s assistant city manager and community development director explained why the city believed its piggy bank of federal grant money was not robbed while acknowledging someone else’s might have been.

“We’ve gone through and done a very full accounting of (the Tillicum Community Center’s) books,” said David Bugher. “As far as the city is concerned, we were made whole.”

Whatever being “made whole” means.

While acknowledging not everything has been done decently and in order with regards Center Director Karen Priest’s handling of funds, the city believes Priest’s personal situation and the nonprofit center’s finances are not related.

Priest purportedly pilfered from pockets other than the city’s.

And the city believes that because?

In a letter obtained by Public Disclosure dated March 25, 2013 addressed to Center Director Karen Priest and which Bugher sent as well to all Center board members, Bugher wrote that the Center “is lacking in effective internal controls and program oversight by the Board of Directors.”

Specifically Community Development Block Grant (CDBG) funds.

Bugher wrote that the Center “did not have in place adequate financial management systems to ensure effective control of CDBG funds.

“The Executive Director has sole control over many functions of the financial process, including payroll, payment of all taxes and labor reporting requirement without a clear link to a Board review and approval process.

“Without proper separation of duties and/or Board oversight, the Center cannot effectively control or minimize the opportunity for someone to perpetuate or conceal errors or irregularities in the normal course of duties.”

But not the city’s share of CDBG money, to hear the city tell it.  Somebody else’s.

Just as problematic is Bugher’s claim of having performed “a very full accounting of the center’s books.”

What books?

“An independent accountant hired by the city in 2012 to review the center’s finances didn’t form an opinion about whether the nonprofit misused federal money in fiscal years 2010 and 2011. Inadequacies in the organization’s accounting records were cited as the reason, according to a report issued Sept. 24, 2012” (source, TNT, May 4, 2014).

Further, Bugher issued a 60-day demand deadline of the Center which would have put the Center’s response to the city’s findings dated May 25, 2013. 

A Public Disclosure Request (PDR) for related documents was sent to the city April 11, 2014.  The Center’s response that was to have been due one year ago – if in fact there was a response – was not submitted by Lakewood in reply to the PDR.

This May 25th it’ll be one year.

Ironically, on May 23rd, Priest will be arraigned in court on charges of theft and more (source: TNT, May 12, 2014).

Meanwhile the evidence of the “very full accounting” the city says it has done?

The public is still waiting.

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Comments

  1. Alan Hart says

    May 15, 2014 at 12:01 pm

    An obvious question is what happened to board of directors of the center. They possibly are liable for failing to exercise financial oversight. Why isn’t the board commissioning an audit? Why hasn’t the board reacted to the deficiencies and insisted upon a satisfactory and timely response to the City’s audit findings?

    Blaming the City for finding problems while fulfilling their responsibility is wrong, especially when their has been a failure of board oversight.

    • David Anderson says

      May 15, 2014 at 4:50 pm

      While you are correct, Alan, in suggesting that significant due diligent oversight responsibility appears quite dramatically lacking on the part of the Tillicum Community Center Board of Directors as pointed out by Bugher in his letter to the board over a year ago, it is not “wrong” – to use your word – to also question why the city believes CDBG grant funds were not compromised – “especially when” – to use your words again – Bugher himself declared the Center board “lacking in effective internal controls” over those very funds.

      What evidence has the city provided to assure the public that what they say is true – actually is?

      “We’ve gone through and done a very full accounting of (the Tillicum Community Center’s) books,” said David Bugher.

      But are these not also the very books which an audit paid for by the city determined to be unintelligible as far as the ability by which the auditor could even form an opinion?

      “An independent accountant hired by the city in 2012 to review the center’s finances didn’t form an opinion about whether the nonprofit misused federal money in fiscal years 2010 and 2011. Inadequacies in the organization’s accounting records were cited as the reason, according to a report issued Sept. 24, 2012” (source, TNT, May 4, 2014).

  2. Midlander says

    May 15, 2014 at 6:43 pm

    Wasn’t this a story about an alleged embezzler? I think someone with a very anti-Lakewood platform is seeing conspiracies where none exist. Looks to me like Lakewood raised a flag early on about the possible lack of checks & balances, then they conducted an audit to insure no governmental dollars (read: your taxes) was embezzled. Let’s shift the focus back where it belongs, on the (alleged) wrong-doer who (allegedly) stole the money.

    • David Anderson says

      May 15, 2014 at 8:00 pm

      The audit. Ah yes, the audit. The audit by an independent accountant hired by the city in 2012 to review the center’s finances. The audit which didn’t reach a conclusion about whether the nonprofit misused federal money in fiscal years 2010 and 2011. The audit that cited inadequacies in the organization’s accounting records as the reason, according to a report issued Sept.24, 2012. Is this the audit you are referring to Midlander? Are these the books Bugher claims were audited and found sufficient, adequate, or whatever he means by referring to such books as having “made the city whole”?

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