Report documents dysfunctional Department of Neighborhoods

Mayor Michael Bell

A report released to Toledo City Council and the media Wednesday by the Bell administration documents a city department that suffered from a severe lack of oversight that led to misplaced equipment, unaccounted for funds, and apathy and malfeasance by its workers.

The investigation was undertaken by former Toledo city auditor, Dan Hiskey and current Toledo law director, Adam Loukx, at the behest of Mayor Michael Bell after a local newspaper raised serious concerns about possible bid fixing and other improper procuedures in a federally funded program to rehabilitate housing in the city.

In their report, Loukx and Hiskey concluded there were too many conflicting statements and not enough evidence to substantiate any charges of bid fixing. They did, however, note several improprieties and violations of procedure in the bid solicitation and opening process.

The bids were solicted by the Department of Neighborhoods on behalf of HUD. HUD's soliciter general's office and the FBI are conducting an investigation into the bids and bidding process as well.

Some area contractors alleged that certain contractors were given preferential treatment by being allowed to view competitive bids and then to bid lower. The report documents one case where two bids, filed by different contractors, were nearly identical which is highly improbable. Other allegations included being forced to use certain third party contractors in exchange for being allowed to bid on HUD projects managed by the city. While the investigators were unable to substantiate these allegations, they were able to cite at least one instance of a city employee, "suggesting" a contractor which the investigators said was an, "impropriety."

They noted that criminal liability would have to be determined by a separate investigation by someone able to determine if there was criminal wrongdoing.

What is more striking in the report is the lack of management and oversight within the department that led to frequent theft of or misplacement of equipment, convicted felons working in city facilities, and a lack of oversight of city funds.

The report states that the city created a fund from which money accrued from the sale of scrap metal from demolitions was deposited. This money was used to pay small claims for incidents involving demolition and to make small purchases for the department. Expenditures were seldom documented and approximately $5,000 remains unaccounted for. Furthermore, the former director of the Department of Neighborhoods, Kattie Bond, claims she did not know the fund existed. Current city employees dispute this, saying she reviewed and authorized expenditures.

Seasonal employees who were not employed by the city, but by a local temp agency, were allowed access to expensive city equipment -- much of which is missing. In one case, Toledo Police were summoned to the department's barn to arrest a seasonal worker with an outstanding felony warrant.

Another case destined to raise eyebrows is the tale of the "Green Monster." The Green Monster was a forklift utilized by the Department of Neighborhoods. However, nobody is really sure how it came to be in the city's possession or where it eventually ended up. The 5,000 pound forklift was "gleaned" from a cleanup job conducted by the department several years ago. It was used around the Department of Neighborhoods shop on Lagrange St. for several years. Some say it was used frequently. Others say it was junk and was never used. There are some who claim the city's maintenance shop frequently fixed the forklift while others say the city's mechanics refused to work on it because of ownership issues.

What is clear is that the Green Monster is not there now. Some workers say it has been gone for a long time. Others say it was the the Department of Neighborhood barn as recently as November. Some say it was sold as scrap. Others don't know what happened to it. There is apparently no documentation for the notorious Green Monster.

That the department was tripping over itself frequently may have been due to a lack of oversight from the top. According to investigators, staff meetings became so contentious that employees felt it necessary to have union representation present. The report concludes there were serious problems in communication between management and staff within the department and there were "blowups" between management and staff and between individual managers. Department workers felt undertrained and were afraid to bring concerns to departmental leadership. The investigators concluded that it was difficult to document the depth of the management problems within the department.

The investigators note that the individual responsible for overseeing the solicitation and opening of bids was not trained in this process. They conclude that had this person been provided proper training, many of the problems involving the bids and bidding process could have been avoided.

Bond and Housing Commissioner, Michael Badik, were fired from their positions in December. Other employees were disciplined with pay cuts and demotions.

Toledo City Council President Joe McNamara has scheduled a committee of the whole meeting of council tomorrow to discuss the report and receive testimony from the administration regarding the reports contents.

Read the entire report here: DON Report