Interim director: Housing authority to take corrective action on improper pay

In a letter to the state legislative auditor, the Morgan City Housing Authority interim director said he plans to take immediate, corrective action regarding the nearly $700,000 in improper bonuses and wages paid to three office workers and the former executive director between 2007 and 2014.
Morgan City Housing Authority Interim Director Clarence Robinson Jr. said in a letter dated Nov. 24 to State Legislative Auditor Darryl Purpera that he will also make and declare suspensions for the classified employees still employed by the housing authority and noted in the investigative audit report in accordance with State Civil Service Law.
The housing authority board called a special meeting at 5 p.m. Thursday, Housing Authority Attorney Robert Duffy said. The only item on the agenda is an executive session for investigative proceedings regarding allegations of misconduct based upon the investigative audit report from the Louisiana Legislative Auditor.
The state auditor’s audit report said the housing authority “improperly paid” employees $566,544 in bonuses between November 2007 and March 2013 based on a reward policy that was altered by Tori Johnson, the authority’s housing manager who handled all Civil Service matters.
The report said another $130,418 was improperly paid by the housing authority to three employees as raises in excess of Civil Service guidelines, according to the news release. The improper raises were paid in six separate increases between May 2009 and June 2014. Some employees received a 20 percent salary increase in a five-month period in 2009, according to the audit.
Johnson, former Morgan City Housing Authority Executive Director Charles Spann, accounting tech Diana L. Pace, and housing manager Sandra Greene all received improper bonuses and wages, the audit report stated.
Pace and Greene are still employed by the Morgan City Housing Authority, Duffy said Monday.
In Robinson’s letter to the legislative auditor, he formally requested the housing authority to authorize the executive director and legal counsel to submit findings and cooperate with the 16th Judicial District Attorney and U.S. Attorney for the Western District of Louisiana for the determination and resolution of any possible criminal violations.
Robinson also requested that the Morgan City Housing Authority may do the following:
—Authorize its legal counsel to file civil suit to recover all funds if no criminal and/or restitution action is taken by either the federal or state prosecutors.
—Investigate the right to take action against State Civil Service classified employees regarding suspension or termination of employment.
—Authorize the executive director to adjust the salaries of classified state civil servants to appropriate allowable levels in accordance with State Civil Service laws until further action is taken.
—Authorize the executive director and housing authority board to investigate the right to file charges with the Louisiana Ethics Administration regarding State Civil Service classified employees.
Additionally, the housing authority should request the legislative auditor to ascertain how the concerns contained within the investigative audit report of the legislative auditor were not discovered by the firm hired by the housing authority to conduct the independent audits during the initial period of concern, Robinson said in the letter.
Kolder, Champagne, Slaven and Company of Morgan City issued audit reports for the housing authority from 2007 through 2013. The authority switched to William Daniel McCaskill of Mandeville for the report issued earlier this year that uncovered the missing funds.
As of Nov. 24, Robinson said the housing authority established the following procedures:
—The housing authority is consulting with counsel and Robinson as to the proper legal requirements to recover funds for the agency.
—The housing authority is now strictly enforcing the adopted Civil Service policy of awarding pay raises as per the planning and performance review for all classified employees annually in the month of October, provided the agency has the funding to pay an annual pay raise. All extra performance compensation must be submitted to Civil Service for prior approval and then submitted to Morgan City Housing Board for final approval.
—All of the current classified housing authority employees have been evaluated as per the State Civil Service guidelines. For the 2013-14 fiscal year, no classified or unclassified housing authority employee has received a pay increase due to the signed layoff avoidance approved by the state office on March 18.
—All of the current classified housing authority employees have been evaluated as per the State Civil Service guidelines with all planning and performance sessions being completed for 2014-15. The evaluations are maintained in the employee’s file. This procedure will be maintained and conducted on an annual basis.
The state auditor said the report was turned over to the district attorney for the 16th Judicial District and the United States Attorney for the Western District of Louisiana, the release stated.