PORT ANGELES — A special deputy prosecuting attorney will decide if criminal charges should be filed over the alleged improper use and misappropriation of public property by city electric utility employees, Clallam County Prosecuting Attorney Mark Nichols said Tuesday.
The allegations include evidence of a “City Light Slush Fund” bank account that was at least 21 years old and was fueled by proceeds from employees cashing in recyclable metal — fuses — to pay for Christmas and retirement parties and potlucks, according to a five-month State Patrol investigation.
Nichols said he expects to choose a special deputy prosecuting attorney within 10 days and to have that person’s charging decision by the end of February.
The State Patrol, which referred its report to Nichols, determined that criminal activity did not occur with regard to recycled fuses, according to the agency’s 14-page Dec. 17 summary.
The city Police Department “found no criminal activity” over the employees taking the poles for their own use “rather than recycling, as they should,” according to the summary.
The city and State Patrol investigations were prompted by an allegation by city Parks and Recreation Department Director Corey Delikat, himself a former public works department employee when parks and recreation was in public works.
City officials — who hired Bellevue attorney Richard Kaiser to follow up on the Port Angeles police probe — also are reviewing the two law enforcement investigations.
Human Resources Director Abbi Fountain said Tuesday the city plans to take action against employees based on the investigations that could range from corrective counseling to termination.
“The city is not going to do nothing,” she said.
Fountain said the city is reviewing “all the information.”
“We acknowledged that four things have happened,” Fountain said Tuesday.
Those things were outlined in a city statement authored, Fountain said, by Heidi Greenwood, senior assistant city attorney, and released late Monday afternoon.
City employees “may have used city tools and equipment in their off-hours for personal projects,” according to the city’s statement.
In addition, “city employees had taken, for their own use, city power poles that would have otherwise been sent to the landfill,” the statement said.
Employees “had an account at a local bank that was, at least in part, funded by proceeds from recycling spent fuses that would otherwise have been thrown away,” according to the statement.
“Fourth, the report found that some employees propagated rumors that the account had funded the education of an employee’s children.
“The State Patrol discovered that the rumor may have started as a ruse or joke.”
The State Patrol investigation found no evidence that the money was used for that purpose.
The report also concluded that “some city employees were evasive and misled the investigators,” according to the statement.
The State Patrol investigation also included interviews with employees who were critical of Public Works supervisors.
“Statements made by many indicate that policies were not always adhered to or were generally lacking, or upper management was aware of employee conduct but looked the other way,” according to the investigation summary.
The electric utility department, which has a $39 million budget in 2016, falls under the purview of Craig Fulton, Public Works and Utilities director.
“From what it looks like, nobody profited personally, and most of the materials were things that most people would have thrown in the garbage,” Fulton said Tuesday.
“That upper management knew about it and looked the other way is not a true statement,” he added.
“The policies that were out there were vague in some areas.’
“We immediately updated our policies with regards to scrap materials and waste materials.”
Delikat confirmed Tuesday that he approached Police Chief Terry Gallagher in April 2015 with concerns over the light poles that resulted in the police department investigation.
Delikat said employees were taking 220 light poles a year “and they were doing it on city time,” with many using the poles for firewood.
It had been going on for about 10 years, said Delikat, 42, who started work with the city as a seasonal employee 25 years ago.
“Just because it’s cedar does not mean it couldn’t benefit people who need to heat their homes,” he said.
The bank account, listed in bank records as “City Light Slush Fund,” had existed since 1995, was closed on Jan. 1, 2015, according to the State Patrol’s summary report.
The value of the recyclable material could not be determined because bank records could not be obtained for earlier than 2012 and the proceeds were given to employees in small cash amounts, State Patrol Detective Krista Hedstrom, who conducted the investigation, said Tuesday.
Lineman Greg McCabe said the fund was jokingly referred to as the “copper fund” and paid for “several extravagant barbecue events” attended by upper management senior staff, according to Hedstrom’s report.
Hedstrom said employees were open about the fund’s existence.
“They weren’t hiding it, that’s for sure,” she said Tuesday.
“The only thing that changed was the type of account and the main signer on the account.”
Hedstrom also said employees told her they would take city-owned hand tools for their own use.
“They would kind of check them out over the weekend and take them back,” she said.
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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 5060, or at pgottlieb@peninsuladailynews.com.
