Ernst & Young auditors join an inquiry that focuses on allegations of wrongdoing at the county agency.
By BILL VARIAN
Published March 24, 2004
TAMPA - Auditors swept into more than a dozen offices of the Hillsborough Water Department on Tuesday, just moments after commissioners approved an emergency investigation of alleged corruption there.
The team from Ernst & Young, accompanied by county technology workers, seized control of computers and papers and stayed much of the day examining them. Participants in the sweep had been waiting outside the buildings and were signaled by phone to proceed immediately after the vote to ensure documents were not removed or destroyed.
County Administrator Pat Bean said the sweep was prompted by complaints from contractors and others who said that for years there has been preferential treatment for certain contractors, consultants and suppliers.
"Nobody has used the word "kickbacks,"' Bean said. "But the allegations, if true, raise the question: Why?"
The unanimous vote by commissioners present - a couple of them were absent - authorizes Bean to spend as much as $200,000 on the investigation. Some allegations have come from contractors. Others have come in anonymous letters from people claiming to be Water Department employees. Among the allegations:
- An unlicensed contractor has received tens of thousands of dollars in painting contracts, a charge previously reported in the St. Petersburg Times.
- The same contractor, Stolc Enterprises Inc., was paid or received supplies purchased through county credit cards in piecemeal amounts so as not to trigger bidding requirements.
- Trees purchased by the county to spruce up a construction site in Apollo Beach turned up at the home of an employee of one contractor, or one of his relatives.
- Contractors are pressured to hire certain subcontractors or purchase supplies from certain vendors, and that the Water Deparment has too close a relationship with its engineering consultants.
- And Water Department project managers unilaterally lowered a 15 percent markup to contractors for unexpected costs to 5 percent, raising questions about what, if anything, happened to the other 10 percent.
Bean said she has forwarded some of the allegations to the Hillsborough County Sheriff's Office and state attorney because of their potentially criminal nature. State attorney spokeswoman Pam Bondi said her office has been examining claims of impropriety at the Water Department for at least several weeks, in concert with the Sheriff's Office.
"We don't want to call it an investigation at this point," she said. An assistant state attorney, Wayne Chalu, has been assigned to work on the case.
Water Department director Mike McWeeny, who is not mentioned in the complaints, is not in the office this week and could not be reached for comment. Celine Hyer, manager of engineering for the department and its acting director in McWeeny's absence, said she did not know the details of the allegations and could not address them.
"There's not much I can tell you other than we're fully cooperating (with the review team)," Dyer said. "Whatever they need, we're cooperating and providing it."
The probe could have broad implications. The Water Department has an operating budget of about $114-million for this year, with another $51.2-million slated for capital projects.
While a good chunk of that operating budget is spent buying water from Tampa Bay Water, much of the overall budget goes to contract work with private vendors.
The allegations also raise the first major test for Bean, who took over as county administrator late last year. Her predecessor, Dan Kleman, was faulted for not quickly addressing workplace complaints in several of his departments.
Bean said she will be delighted if the review shows no wrongdoing. But there's a chance it will show otherwise, she said.
"Then I need to make a statement to the organization that I won't tolerate this," Bean said. "I want people who do business with Hillsborough County, and people who live in Hillsborough County, to understand that we live by very ethical standards here and we're not going to tolerate anything less."
Commissioners praised Bean for her prompt attention to the allegations.
"You can't be namby-pamby about these things. You have to be strong and decisive," said Commissioner Ronda Storms, who initially drew the administration's attention to the Stolc allegation. "Otherwise it's an almost immediate erosion of her credibility and her moral authority to lead, and she can't fritter that away."
Employees with the county's Purchasing Department have already looked at some of the allegations and found enough to lead them to recommend seeking outside help. In one instance, said purchasing director Lu Banks, records raised some red flags.
Her office reviewed statements of credit card expenditures within the Water Department. They revealed dozens of payments to Stolc Enterprises. Many were made within days of each other - and sometimes the same day - and fell just below the $1,000 cap that would have required the county to seek bids for the work.
The amounts also were often in round dollar amounts, with no fractions of dollars.
"Clearly you can see that there are some things that look a little bit funny here," Banks said.
Peter Stolc, who owns the company in question, has acknowledged to the Times that he is unlicensed, but said he was not initially aware he needed a license. When the issue was brought to his attention, he said he sought references for the Water Department that would help him get licensed, but was denied and cut off from any other work.
He said he has done quality work for the county but now, partly because he is a Polish immigrant with little recourse, he is being singled out for punishment by a department eager to deflect examination into more wide-scale problems.
- Times staff writer reporter Chris Goffard contributed to this report.
