PORT ANGELES — City Manager Kent Myers is a man of many meetings, but Friday, he canceled an important one penciled in for Monday.
The meeting was with Kim Hurley, manager of investigations for the state Auditor’s Office, agency spokeswoman Kara Klotz said Friday.
Myers and other city officials, including City Attorney Bill Bloor, were set to discuss Hurley’s final draft of a special investigative report on city construction projects, alleged city payments to various businesses and alleged travel expenditures by former Mayor Karen Rogers and former City Manager Mark Madsen.
The report was prepared over the past six months in response to an anonymous complaint to the Auditor’s Office.
Myers said Friday he did not raise serious objections to the draft report Tuesday during a telephone conference with the Auditor’s Office on the report’s conclusions.
“I’m not expecting the city to be implicated in this audit,” Myers said.
Rogers, pointing out that her council term ended in December, 2009, said in an email to the Peninsula Daily News that the auditor’s report concerned the city of Port Angeles and that she had not been invited to the Monday meeting.
“I look forward to getting any issues, information or concerns resolved regarding whatever questions the citizen(s) has that are behind this hotline inquiry,” she said.
City officials had already reviewed a draft of the report, Klotz said.
But Myers said Friday that “issues surfaced” after the Tuesday meeting, calling the report “incomplete.”
He refused to elaborate.
Klotz was surprised by Myers’ action.
She said he “just canceled” the meeting at about 10 a.m. Friday.
“We told him as far as we’re concerned, it’s not canceled.”
But Myers pressed the matter, saying in an email that the meeting “will need to be rescheduled,” according to Klotz.
“I would characterize it as not what we were expecting,” Klotz said, calling the cancelation “unusual.”
“I think everyone is trying to regroup and figure out what the next step is,” she said.
“We need cooperation from the entity to have a meeting. It will be rescheduled, though.”
She said the report had been scheduled for public release April 11 but that a future release date has not been determined.
Myers said he’s talked about its conclusions with Hurley.
“The city has done nothing wrong, did not violate any rules or state law, and that will be confirmed in the final audit report,” Myers said.
“This thing has been going on for six months. We will insist that [the report] be completed in two weeks.”
Klotz and Myers refused to discuss the specifics of the complaint or the report’s findings, which the Auditor’s Office terms “results.”
“If the city has concerns about completeness, we won’t make it public until we feel like we’ve addressed their concerns,” Klotz said.
The final report will be referred to the state Attorney General’s Office for review as a matter of procedure, Klotz said.
Attorney General’s Office spokesman Dan Sytman said Friday that “we will review it,” refusing further comment.
In a November email to the city, Hurley outlined the issues she and her audit team would review.
They include allegations about construction projects overseen by the city Public Works Department and managed by Exeltech Consulting Inc. of Lacey, including The Gateway transit center and Eighth Street bridges, both of which were built under Madsen’s and Rogers’ tenures.
Madsen, who has moved from the area, could not be reached for comment.
In conducting her investigation, Hurley also looked into alleged payments from the city to Fred Hill, the Incubator, The Remediators Inc., Capacity Provisioning and Advanced Composite Technologies, along with payments to Exeltech, according to documents Hurley requested from the city.
Exeltech hired Rogers in April 2010 to oversee the company’s regional development efforts after she left the City Council.
Rogers also has been a consultant for Fred Hill Materials and served on the board of the nonprofit Clallam Business Incubator.
“This auditor investigation is about the city of Port Angeles and I am not invited nor part of the meeting on Monday,” Rogers said in her email Saturday.
““This is a city meeting with the State Auditor’s office,” she wrote.
“My council term ended December 31, 2009. I was not even aware of the audit investigation nor did the city of Port Angeles tell me about this until one of my clients received an email from Kim Hurley of the State Auditors office in December 2010.
“I then contacted the city manager and asked what was going on.”
Public Works Director Glenn Cutler said he has not seen the draft of the report and did not know its contents.
“I can’t address anything until I look at the report,” he said.
Exeltech has been awarded $5.8 million in city contracts over approximately the past eight years.
The company’s contracting with the city “was all fair and above-board,” Exeltech finance manager Michelle Rhodes said.
“There was nothing that could be misconstrued as illegal in our dealings with the city of Port Angeles.
“Anyone who would look at those records would realize they were fair and honest,” said Rhodes, adding that she does Exeltech’s contract invoicing.
Clallam County Administrator Jim Jones, on the Incubator’s board of directors since November 2009, said he would be “shocked” if the Auditor’s Office report found anything illegal.
The entire board resigned in November 2009 when the county Economic Development Council took over management of the Incubator, but Jones said he’s reviewed the Incubator’s past financial history.
“I’ve reviewed the books and stuff, and I’d be very surprised if they found anything improper,” he said.
Mike Rauch, president and chief executive officer of Angeles Composites, said his company has never received any payments from the city.
“I was surprised to see our name even mentioned,” Rauch said.
“Obviously, the complainer didn’t know what he was talking about, but I guess that’s life. I’m sure the Auditor’s Office quickly realized no payments have ever been made to my company.”
Fred Hill Materials Chief Financial Officer Martin Blevins was unavailable for comment Friday, a company employee said.
Phone messages left with The Remediators and with Capacity Provisioning co-owner Bob Jensen were not returned.
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Senior Staff Writer Paul Gottlieb can be reached at 360-417-3536 or at paul.gottlieb@peninsuladailynews.com.
