Deena Winter: Digging deeper into Antelope Valley

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Councilman John Spatz is considering asking for an audit of the city’s Antelope Valley Project in the wake of the Journal Star’s recent series examining spending on the public works project.

During an informal council meeting Monday, Spatz said an audit could examine how the city is spending Antelope Valley money and what the contracts look like, for example.

The City Council can request audits by the seven-member volunteer audit board the mayor and council established this year to conduct performance, internal and financial audits.

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Councilwoman Robin Eschliman suggested a meeting with representatives of the Joint Antelope Valley Authority board, which oversees Antelope Valley and is made up of representatives from the city, university and Lower Platte Natural Resources District.

She also questioned why the city is not replacing former Antelope Valley Project Manager Wayne Teten, who retired in October.

Mayoral aide Rick Hoppe said a full-time employee was not deemed necessary, because most contracts have been awarded as the project nears the end of the first phase. Instead, several city employees took over his duties.

Eschliman suggested the council compile questions for the JAVA board to get a better sense of what to audit.

Antelope Valley’s balance sheets are independently audited annually and an audit also will be done when the project’s first phase is done in about three years. But State Auditor Mike Foley said those audits differ from the kind of audits he conducts, which often unearth questionable spending.

He said private CPA firms are under pressure to get audits done, get paid and move on to the next audit. Conventional financial audits give an opinion on an entity’s financial statements, not whether the money is being spent appropriately. They don’t have the luxury of going into more detail or digging into questionable issues, he said.

“We don’t have to worry about the next client that’s waiting for his audit,” Foley said.

He said in government, taxpayers don’t just want to know financial statements are accurate — they also want to know whether taxpayer dollars are being spent wisely.

Was money embezzled? Was the system manipulated?

“We focus more on those kinds of questions rather than focusing on the believability (of financial statements),” Foley said.

He said it would be “very, very difficult” for the city’s volunteer audit board and its $100,000 annual budget to do an in-depth audit of Antelope Valley.

“I don’t think $100,000 is going to get you very far,” he said.

His office receives phone calls and tips year-round that sometimes launch unannounced audits in cities. For example, his office recently received an allegation regarding Cedar Bluffs.

“The next day, three auditors showed up,” he said. “The treasurer started crying. Within two weeks, she was fired (by the village board).”

And the auditors hadn’t even finished their work.

He recently received calls and e-mails about Antelope Valley, and could do an audit at the city’s request or on his own volition.

“They can ask me or I could just do it,” he said.

Spatz said he hopes to discuss the matter as soon as possible.

“We need to figure out how to address questions,” he said. “Especially when there’s a vote coming up on an arena. The public needs to know we will make people accountable.”

Svoboda and Spatz question Seacrest

During the City Council meeting Monday, it was the council’s turn to ask attorney Kent Seacrest a few questions.

Last week, Seacrest suggested Republican Jon Camp might have a conflict of interest in voting on two Haymarket redevelopment projects. Camp owns eight buildings in the Haymarket.

Councilman Ken Svoboda addressed Seacrest directly, saying Seacrest has come before the council many times and done an “outstanding job” promoting projects.

But he turned the tables on Seacrest in a long-winded question:

“When you do come forward, I as one council member, always question if you’re coming before us as a consultant or representative of (the) city and Antelope Valley, or the city and West Haymarket Park, the city and DLA (Downtown Lincoln Association) or whomever it might be and then at the same time representing the 2015 Vision group, and then here today … presenting yourself in a private capacity, representing some developers that are solely a part of this whole concept of not only 2015 but the West Haymarket and DLA and everything that goes along with this. And when we talk about conflict of interest … it kind of hit me over the weekend that — is there a fuzzy gray line when it comes to your public testimony, when it comes to who you are actually representing when it comes to these matters?”

Seacrest said that was a “good and fair question” (if not exactly eloquently asked) but said he doesn’t believe he’s violating any of the Nebraska Supreme Court’s rules of professional conduct for attorneys.

He said his work on the Haymarket projects hasn’t kept him from continuing to give the city his “full professional advice and range of options and strategies” on the Antelope Valley Project, for example.

Councilman John Spatz also questioned Seacrest’s decision last week to give the council a letter outlining his concerns about Camp’s possible conflict of interest.

Spatz said Tuesday he didn’t have a problem with Seacrest raising the issue, but he thought it “odd” that Seacrest “sprung” the letter on the council during the meeting, rather than contacting council members before the meeting.

“He didn’t have to do it during the meeting,” Spatz said. “I thought he could’ve handled it better. … What can we do about it at that point?”

He said it

“We can never find a state senator brave enough to introduce it.” — Kerry Eagan, chief administrative officer for the county, on the county’s longtime desire to get a lawmaker to introduce legislation that would change the state rules dictating how public employees’ salaries are set. State law requires employees’ salaries be comparable to their peers in similar-sized cities, regardless of budgetary woes.

Reach Deena Winter at 473-2642 or dwinter@journalstar.com.