Vote to bring back utility expansion auditor raises concerns

News-Press.com – Fort Myers, Florida – Southwest Florida
March 2, 2010

Vote to bring back Cape Coral utility expansion auditor raises concerns

By Brian Liberatore

The last time Michael Kessler was in Cape Coral, he kicked up a cloud of suspicion that still hangs over the massive utility expansion project.

His return, some hope, will clear the air.

“It will get cleaned up one way or another,” said Mayor John Sullivan. “Either everything was OK or it wasn’t. It if wasn’t OK than I think we’re owed some money.”

Sullivan and three councilmen Monday voted to bring back Kessler, a New York City-area auditor to finish his 2006 investigation into a decade-old utility project. That 80-page audit brought allegations of bid rigging as Kessler said he was denied vital information that kept him from completing the report.

Opponents of Kessler’s return fear the city is wasting the $60,000 it will cost to bring him back.

Kessler said he wouldn’t pursue an audit unless he could access records he needs.

“Either we have a solid plan before we go down there or we don’t go,” Kessler said. “It would be foolish to just spin our wheels.”

There is no guarantee Kessler will get the information he was denied by the contract manager four years ago or even how much of the data still exists. And even if Kessler finds the city was overcharged, ratepayers might never recover any money. The state sets a five-year statute of limitation on contract discrepancies. The contract Kessler would be examining ended in 2004.

The City Council still needs to come up with the details of the audit. The council Monday approved the money to bring back Kessler but so far hasn’t established the scope of the audit or the time frame.

Kessler said he was still waiting to hear from the city for specifics.

A fast exit

Kessler left Cape Coral in 2006, leaving the podium during a meeting to catch a flight before the council bombarded him with dozens of questions his $130,000 investigation into utility expansions in the Southwest 1, 2 and 3 assessment areas – an area that includes about 8,400 properties. Single-family homeowners in those areas paid special assessments between $9,846 and $10,943 for sewer, water and irrigation utilities.

Kessler’s report alluded to bid rigging, prompting a look from the U.S. Department of Justice and the FBI. After four years neither agency has filed any charges.

“I haven’t had any contact with them in years,” said former City Manager Terry Stewart. “And I’m confident that I never will.”

A dead horse?

Councilman Marty McClain on Monday, blasted Sullivan’s plan deeming it a personal agenda. Sullivan and Deile, who both voted for the audit, have active lawsuits against the city over its utility expansion program. Sullivan pointed out that both suits regarded the Southwest 4 area while Kessler’s audit focused on the Southwest 1, 2 and 3 areas.

Separate audits by R.L. Townsend & Associates, and PricewaterhouseCoopers both showed “MWH has completed work according to standards of business integrity, and contractual obligations,” an official company statement read.

Despite the two other audits and the city management’s insistence Kessler’s claims were bogus, skepticism over the project has continued because of high costs that had property owners in another assessment area paying over $19,000. It was stopped last year.

Former Councilman Tim Day had pushed for Kessler’s return shortly after Kessler left in 2006. But four years later, Day said it’s too late.

“At this point it really is beating a dead horse,” Day said. “It’s time to move forward.”

Kessler gets definitive answers.

Check all your options and you will see that a no-risk consultation could be the best investment you’ll ever make.

Submit a Case