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Posted on 12/28/2007, 5:26:38 PM by Clint Williams
Institutions take on the worst characteristics of the people who head them.
In the case of the Port of Seattle, this means sickening arrogance.
Faced with a damning state audit showing the port to be rife with sloppiness, waste and the potential for rampant fraud, the man long responsible for shaping port culture -- its former chief executive, Mic Dinsmore -- replied with haughty grandeur.
"I have no doubt that there is nothing of substance in anything that has been alluded to," Dinsmore huffed to the Seattle P-I after the audit blast came last week. "Let the process show what I just said to be true."
This much is true: Dinsmore's arrogant tone is dismissive and misplaced.
The warning flags detailed in the audit, which looked at port construction management, didn't just start flapping overnight. They occurred on Dinsmore's 14-year watch as port chief, which ended this year. This snapshot of trouble is a part of his legacy he is reluctant to claim.
The Port of Seattle -- which runs Sea-Tac Airport -- needs to get its act together, and that could begin with an industrial-strength scrubbing of the work culture Dinsmore shaped and left behind.
The audit comes from a solid source -- State Auditor Brian Sonntag, who contracted with the private firms Cotton & Co. and CDR Consultants. A recap of the audit's port lowlights:
# The port squandered nearly $100 million in public funds during construction projects and contracts between 2004 and 2007.
# The port lacks sufficient policies and procedures to safeguard public assets from misuse, abuse and fraud schemes, characterized by bribes, kickbacks and illegal gratuities. Where controls are in place, they're at times ignored.
# Port executive management withheld information and sometimes misinformed port commissioners about key projects.
# Contracts were awarded without evidence of competition -- something that reeks of cronyism. The audit blanched at the overly cozy, buddy-buddy relationships between port representatives and contractors.
# The port cries out for independent, robust oversight when it comes to handling contracts and is spotty about keeping projects on track. One reason? Its records are incomplete, disorganized, missing or not updated.
The meat is in the details.
I spent Christmas reading the 334-page audit and found that when it comes to giving, the port's apparent generosity gives that jolly fat guy with the red suit and reindeer a run.
A port consulting agreement awarded in 1993, involving a third airport runway, for example, mushroomed without competition from $950,000 to more than $30 million, the audit found. Another agreement, in 1998, did the same thing -- ballooning from $10 million to more than $120 million.
I was surprised to read that the port has a knack for letting contractors pass cost increases on to the port by raising the billing rates of consultants. "These approvals appear automatic," the audit said. "We saw no situations where such requested salary and billing rate increases were denied."
Nice. There's money for everyone in the port potluck. It's just public cash -- so, who cares?
(And you wonder where initiative guru Tim Eyman finds rich fodder for his rants about government waste!)
But wait, there's more. The audit alleges that the port altered contractor invoices to pay for work that exceeded the maximum amount set by law, "thus violating state law." And the port appears to have manipulated certain contracts to a small number of preferred contractors -- something that defies the port's "commitment to competition."
The port failed to enforce schedule requirements and price controls for contractors, the audit found, and an internal port auditor lacked critical independence.
On top of that there were apparent conflicts of interest, including a case of a $1.4 million contract being awarded to a former port employee's company without evidence of competition.
Auditors didn't find conclusive proof of fraud.
Then again, this was a performance audit, not an investigation, though auditors said the port put up roadblocks to their access to information.
Why do that if there's nothing to hide?
The port report card, judging from the audit, cries "unsatisfactory" and "needs improvement."
To Dinsmore, such criticism seems a fiction. In his mind he left behind a perfect port with no rats and sunny weather.
Brace yourself -- more is to come.
"This is not the end of our audit work at the port," Sonntag vows. "Next year, we plan to conduct another performance audit that takes a broader look at port operations beyond construction management."
The public can hardly wait.
How in the world am I not on that ping list? Could you put me on it?
I have no doubt that there is nothing of substance in anything that has been alluded to.
On the good side, there’s Ivar’s Acres of Clams.
Keep clam!
schu
One hundred million dollars wasted and no one in any position of power seems to care. This waste of tax collars occurs in DSHS, Dept of Corrections, WDOT and when they fall short due to mishandling, misappropriations or fraud, they simply ask for more taxes. They don't care because nothing happens to them. The system is locked up with arrogant, self-serving, 'rats. It looks like until we can somehow get them out of power this is what we are stuck with.
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