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Unapproved $650,000 - In Scope of Plan But Not Referred to Council, as Required

Another letter from Mayor Mary Ann Lutz:

I reported to you Wednesday morning that we had discovered nearly $650,000 in change orders for Station Square construction that went forward without approval from the City Council. I want to update you now on what we have done to investigate and remedy that situation.

The Council met in special session this morning to hear a report from City Manager Oliver Chi on how the procedural breakdown occurred. His report satisfied the Council that the change orders were within the scope of plans presented and approved in study sessions (although not presented to the Council for formal approval as required) and that the contractors had proceeded in good faith based on authorizations from two City employees. The Council then voted unanimously to authorize the additional expenditures.

One of the individuals responsible for bypassing formal Council approval is no longer employed by the City and the department involved has since been reorganized and is under new management. I have asked the City Manager to address the matter of the second responsible party in an appropriate manner. I also asked for and received a public commitment that he and his management staff will see to it that this never happens again.

Additionally, I have asked that the Council establish a committee, including two of its members, to oversee the entire Station Square project. Station Square is the largest such project ever undertaken by the City and has come at a time of reduced staff and resources. It is important, therefore, that the Council engages directly in the oversight process.

Mayor Mary Ann Lutz

- Brad Haugaard

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