- The Washington Times - Thursday, September 16, 2004

The D.C. Office of the Inspector General is investigating whether city contracting officials got kickbacks for selling used firetrucks in auctions at “bargain basement prices.”

The city’s Office of Contracting and Procurement lost more than $1 million in potential revenue in its vehicle auctions over a 27-month period, according to the results of an audit released by the inspector general’s office earlier this month. The Washington Times first reported the audit’s findings Sept. 3.

Assistant Inspector General William DiVello yesterday told The Times that auditors have turned over their findings to investigators within the inspector general’s office.

The office’s investigations division, which targets individuals and handles accusations of fraud and corruption, will consult with the U.S. Attorney’s Office if there is evidence of criminal wrongdoing, Mr. DiVello told The Times.

During a D.C. Council hearing yesterday, council member Vincent B. Orange Sr. questioned whether any contracting officials received kickbacks.

“There is a glaring problem here, and someone is benefiting at the expense of D.C. taxpayer dollars,” said Mr. Orange, Ward 5 Democrat and chairman of the government oversight committee.

The contracting office’s Personal Property Division sold 11 fire engines at public auctions for an average price of $284. The city auctioned 38 ambulances for a total of $121,900 — about one-tenth of the $1.2 million the vehicles were valued at by Internet dealers, according to the inspector general’s report.

In one instance, the Personal Property Division sold for $25 a fire engine valued at $125,000.

Auditors found the city also was losing in excess of $500,000 a year as a result of poor oversight and a lack of internal controls inside the Personal Property Division. The audit said the office, which is responsible for auctioning surplus city property, was costing the city $1.50 for every $1 in property it disposed of.

Officials have not disclosed the identities of employees and individuals or businesses involved in the sales of used emergency vehicles. But Mr. DiVello said a vehicle dealer bought nine of the trucks and a broker purchased two others.

Mr. DiVello said that, while the District cannot use old firetrucks, the vehicles slated for auction often operate well. He said other municipalities are willing to pay competitive prices for them.

Interim Chief Contracting Officer Herbert R. Tillery testified that the contracting office has suspended all surplus-property auctions, effective Sept. 10.

Mr. Tillery took charge of the contracting office after Jacques Abadie III turned in his resignation as chief contracting officer to City Administrator Robert C. Bobb last week. Mr. Abadie’s resignation is effective Nov. 15.

Last week, Mr. Bobb said the contracting office in recent months had been the subject of a top-to-bottom review “coincidental to the resignation.”

Mr. Tillery yesterday said he is “addressing the entire system” within the contracting office’s eight-employee Personal Property Division.

“There is some mechanism that was not available in the system that would cause someone to raise the flag,” he said.

Mr. Abadie has disagreed with some of the findings in the inspector general’s report in a letter to interim Inspector General Austin A. Andersen. He said some of the vehicles needed major repairs.

But Mr. DiVello yesterday said eight of the 11 auctioned firetrucks had working engines and did not appear to have any body damage.

During Mr. Abadie’s tenure, city workers misused government-issued credit cards, making hundreds of impermissible purchases between May 2001 through April 2003, according to an audit by the Office of the Chief Financial Officer. The abuse prompted the temporary suspension of the credit-card program.

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