OGDEN -- Ogden's administration spent $434,000 on three capital improvement projects between 2007 and 2009 without the city council's permission, state auditors have determined.
Mayor Matthew Godfrey and the city council were notified of the findings in a report issued earlier this month by Utah State Auditor Austin G. Johnson.
The administration's failure to get permission from the city council for the expenditures is labeled a significant deficiency and does not comply with state law or municipal ordinances, the report states.
"We are concerned about the administration's attitude toward the importance of the city council's approval," auditors said in the report. "The Administration's willingness to ignore internal control processes, state law, and city ordinances indicates a weakness in the control environment and could result in the misuse of funds."
The audit was prompted by a written complaint in March 2009 by local activist Dan Schroeder.
"I filed the complaint because I wanted some accountability," Schroeder said in an email to the Standard-Examiner. "The question now is whether anything will change. The next time the administration spends money without authorization, will the city council hold them accountable or will the council again sit around and do nothing?"
Schroeder's grievance involving a proposed ice tower, a railcar welcome center and the Ogden River Restoration project isn't new and has been reported by the Standard-Examiner and also discussed by the city council, said Mark Johnson, the city's chief administrative officer.
"Dan feels like he has uncovered things, but we have talked about it openly," he said.
The recently released audit deals with three capital improvement projects from June 2007 to October 2009.
The city received a Weber County RAMP grant for the construction of a proposed ice climbing tower downtown and incurred about $36,000 for design and engineering costs only to learn the grant could not be used for those purposes, according to the audit report.
The city continued to incur about $27,000 more in design and engineering costs for the tower that were unallowable under the grant and without city council approval. Local philanthropist John Gullo ultimately wrote the city a $63,000 check in 2009 for the engineering and design expenses.
Also in 2009, the city's administration overspent the project budget to convert a railcar at the Intermodal Hub at 23rd Street and Wall Avenue into a welcome center by $96,000 without council approval, the audit report said.
The city council eventually appropriated funds to cover the overage. Godfrey later admitted to the council that mistakes were made in determining how to fund the cost overruns.
The administration also paid $275,000 for the Ogden River Restoration Project using bond funds originally allocated to storm water improvements without council knowledge or approval, the audit report states.
John Patterson, the city's chief administrative officer at the time, was quoted in the Standard-Examiner as saying he "would do it again" in using bond funds without city council permission, the audit noted.
In a written response to auditors, Godfrey administration officials attempted to explain why bond funds were used for the river restoration project.
"At the time of the expenditure, the Capital Improvement Plan ordinance did not provide an adequate or expedited mechanism for engaging in time sensitive pioneering work of this type necessary to formulate a Capital Improvement Project review," the administration said. "Had city administration failed to act in a timely manner, the city would not have obtained over $3 million worth of grant funding it received for the river restoration project."
The administration also said it has since worked jointly with the city council to pass an ordinance to prevent future issues such as those detailed in the audit.
The new ordinance provides funding of certain expenditures for studies and investigations to determine the feasibility of new capital improvement projects. Those may include market studies, alternative analysis, preliminary design and engineering and grant applications.