EXTERNAL AUDIT – GO! Shreveport City Council

by Elliott Stonecipher

The City Council voted 5-2 in yesterday’s meeting to move ahead with an external audit of the services, billing and payments between the Glover administration’s Finance Department and financial adviser Grigsby & Associates.  Media reports of the vote were filed by Nick Caloway of KTBS Television (here), Kristi Johnston at the Shreveport Times (here), and Fred Childers of KSLA Television (here).

For those who attend City Council meetings or watch them on television, Mayor Glover’s long-winded dressing-down of the Council for considering this action was no surprise.  For those who have read my reports of the matter, neither is it surprising that Council members Sam Jenkins and Rose McColloch are the only two who spoke and voted for the Mayor.

The five councilmen who voted for the audit – Michael Corbin, Ron Webb, Joe Shyne, Jeff Everson and Oliver Jenkins – are the same five who voted recently to prevent Glover’s attempt to pass the $94,000,000 bond issue for “streets.”  Aspects of that attempt by Glover greatly increased questions about his and the city’s relationship with its financial adviser.

An Example of Designed-In Abuses at Issue

While some media reports assert that is audit is only about Grigsby & Associates, it is actually about the way the city has structured and interpreted the consultant’s contract, as well:  it is about the relationship between Glover (and city departments he controls) and the firm.  The audit must look not only at how the firm performed under its contract, but also how the contract may have been written to suit the firm and its “friends” in City Hall.

For example, while Glover and some in the media assert that the contract for Grigsby & Associates does not require itemization of travel and other out-of-pocket expenses, not only is that not the case, it may also be a contract defect which has been designed-in for illicit purposes.  Here is the precise Contract language:

“The monthly invoice should include the following

1) Monthly accounting of working days devoted to City matters, core servcies and/or special services performed; and
2) A detailed list, and where applicable, verification of out-of-pocket expenses being requested for reimbursement
3) Copies of original receipts, where applicable

For those of us who have ever billed for out-of-pocket expense reimbursement, not only do we know that it is the “usual and customary” practice to bill for any such reimbursements only with attached receipts as back-up, but we also know that this contract language suggests precisely that.  But, in the “up is down and down is up” Glover world – as opposed to the real one – he and his followers and partners interpret this mean that no detailed itemization and/or receipts of expenses are required by the contract.

If, as some believe, the words “where applicable” were purposely and illicitly chosen and inserted (by Glover and/or the city finance department and/or the city attorney) as a way to allow over-billing in that category – over-billing which generates money for the benefit of yet unidentified parties – then an external audit provides some hope for a remedy.  There is, clearly, no other hope for a remedy from and within this administration and its “friends” on the Council side.

Another of the Many Whoppers From and By Glover & The Gloverites

It has also been head-snapping to hear Dale Sibley, Glover and others contend that “all that is necessary” in this matter is to take the internal “audit,” and give this bunch “time” to repair all related accounting / ethical / legal defects.  This hokum is often accompanied by the twin hokum that the folks in the mayor’s office “didn’t know” about the internal audit until relatively recently.

As to the first assertion, many, many Shreveporters know that Glover and his team were alerted to these problems months ago, and not one finger was lifted by them to do anything about anything until the past week or so.  It was also months ago when the city finance department “disappeared” some key checks for payments to Grigsby & Associates.  It was also months ago when Glover first hijacked the Audit & Finance Committee to postpone its push for an external audit until after the Tarver-Jackson election.  (The second hijacking was when Glover crashed a later A & F Committee hearing to which he brought Rose McCulloch as the fourth vote necessary to prevent the Committee’s vote for the external audit.)

On the second assertion, it might be worthwhile to note that if the internal “audit” requested by two Councilmen had been handled properly, no one in the mayor’s office would have been told about its findings and process until after the report was presented and analyzed by the requesting councilmen.  Rather, a full and complete review of all related e-mails between the internal auditor and any and all personnel in the mayor’s office will prove not only that the mayor’s bunch were in on the “audit” from early on, but also that the internal “auditor” contends such was appropriate.

The Necessary First Step

Yesterday’s vote is the necessary first step in the effort to have an independent external audit conducted.  It is not, however, the end of Glover’s fight to kill it.

In coming days and weeks, Glover will use every inducement (?) available to peel Council votes off any and all procedural steps along the way, e.g., who the audit team will be, how much this will cost, etc.  In fact and in truth, Glover has no say – none at all – in any of that.  For him to succeed in controlling the audit, therefore, he must turn 2 council votes to his side.  If Glover, his city attorney, his finance director, his outside attorneys, Grigsby’s attorneys, etc., etc., etc., find their way into this process – carefully and exclusively reserved for the Council in the City Charter – it’s because 2 of yesterday’s 5 Council votes switch sides. 

This is now the Council’s – exclusively – to get done … period.  It doesn’t take a wartime consigliere to tell us who is coming to subvert the public interest and promote their own, or how they will come.   

Elliott Stonecipher

For any reader who may not know, this and all other such analysis and commentary I forward to you has been done strictly in the public interest.  No compensation of any kind has been solicited, offered or accepted for this work. 

Evets Management Services, Inc.
6658 Youree Drive
Suite 180, #367
Shreveport, LA  71105
Phone:  318-424-1695