Durango plans to hire a new auditing firm to scrutinize city spending, adding to a growing list of remedies sought to understand and resolve what appears to be a host of accounting irregularities.
The Colorado Bureau of Investigation is three months into a criminal investigation into alleged misappropriation of public funds, and the city has sought assistance from the Colorado Department of Local Affairs to review the proposed 2020 budget – both moves come in addition to hiring a new auditor.
Few specifics about the scope of the city’s budget problems have been made public. Officials have not made clear how far back irregularities may extend; how much money, if any, was lost, stolen or misappropriated; who might be responsible for past errors; and a timeline for when the budget numbers will be verified and the criminal investigation might be finished.
Part of the uncertainty is because city officials aren’t yet certain of such details. And part of it is because public officials and criminal investigators are not at liberty to discuss pending criminal cases.
But public officials say Durango residents can have confidence necessary steps are being taken to find answers and fix past mistakes.
“The community can have confidence that we are taking proactive steps to address the situation to the best of our ability, and we will continue to do so until we feel very confident,” Mayor Melissa Youssef said in an interview.
The Durango City Council directed staff to search for a new firm to audit city spending “given the issues that we’ve uncovered – especially allegations of misappropriation of public funds,” Youssef said, referring to the Colorado Bureau of Investigation inquiry.
The search for a new auditor is an attempt to get “a new set of eyes looking at our (finance) department and verifying and providing checks and balances,” Youssef said.
She added: “Given that we are in a situation with a criminal investigation ongoing, the new set of eyes outweighed any benefit of continuation (with the previous auditor). We don’t want continuation, we want new.”
The city also recruited the Colorado Department of Local Affairs to review the proposed 2020 budget for accuracy and best practices.
The city sought a DOLA review as “a resource to create a better, more transparent, more easily understandable budget document that is accurate and timely and easy for the public to understand,” said Interim City Manager Amber Blake.
But a full accounting of how the city plans to spend its money is unclear and will remain that way until at least the end of January as city staff wait for the state to complete its review, she said.
Once the proposed budget review is complete, staff plan to bring any corrections and amendments to proposed spending to City Council for approval, Blake said. Staff recommended the city send its budget to DOLA for review, Youssef said.
“We need to have confidence in our budget book, we need to know that it’s accurate,” she said. “Budgets are all interrelated, and we want to know that the 2020 budget is completely accurate so that when we go into 2021 we know the base is accurate.”
The CBI is focused on criminal conduct, but the bureau declined to release the number of people being interviewed, how far back investigators are looking for misconduct and any clues as to how much money may have been misappropriated.
It is a “very meticulous” investigation and involves “interviews, reviews of documents and other financials,” said Susan Medina, a spokeswoman with the agency. The agent leading the investigation “is performing interviews at this point,” she said, but CBI has not announced a timeline for how long its investigation may last.
“Part of the reason we don’t comment on timeline, you never know what happens in the course of an investigation,” Medina said. “We just don’t want to provide information that would be inaccurate at some point.”
The City Council expects CBI will inform it of any important updates in the investigation, but Youssef said, “We are all anxious for information.” The investigation may take months, and she said, “I understand the importance of conducting a thorough and accurate review of a criminal investigation with people’s lives at stake.”
But some sort of insight into the investigation is in the public’s interest, she said.
“Information on the timeline would be very helpful so that we understand a bit more about the process,” Youssef said. “Understanding what’s taking place helps all of us to have confidence in the system itself.”
bhauff@durangoherald.com
