(July 31) It was his hiring of an investigator to look into the details surrounding financial irregularities in the public works division that had been uncovered during an audit of that department’s operations that led to Stephen Compton’s suspension as city manager, the Sentinel has learned.
The audit, which Compton commissioned last fall after his routine oversight of public works department operations raised questions, brought to light poorly documented and questionable financial activity in the department. Recently a complaint filed against the public works department by Colton citizens which showed some  questionable projects in that division appeared to have involved work done to benefit members of the city council, documents obtained by the Sentinel show.
Compton’s subsequent hiring of an investigator to look into these matters was done without consultation with the city council. As that investigation was proceeding, the council caught wind of the matter and moved to relieve Compton of his authority. In so doing, the council shut down Compton’s original investigation.
The council hastily arranged to appoint police chief Steve Ward to act as acting city manager in Compton’s absence and then tasked the city attorney, Cristina Talley, to investigate Compton’s actions. While Compton remains on paid administrative leave, public statements by some members of the council suggest that Compton’s termination is likely, pending the outcome of Talley’s investigation.
Nevertheless, despite a shroud of secrecy that has been placed over the matter, ostensibly in compliance with the confidentiality that normally attends any personnel action relating to public employees, an independent inquiry that in some respects parallels the ground that was covered by the original audit and the follow-up investigation Compton initiated thereafter has churned up documentation implicating Colton Public Works Director Amer Jakher in ordering his department’s employees to carry out “off the book” assignments that utilized city materials and equipment  on work that had not been officially authorized by the city council. One of those projects involved repair work to property owned by city councilwoman Susan Oliva. Another project was one that provided improvements to the street upon which councilman Frank Gonzales lives.
Compton’s first line of expertise is in the field of municipal finance. He was the finance director and former assistant city manager in Ridgecrest, at one time the finance director for Omnitrans and was most recently before coming to Colton the accounting manager for the city of Fountain Valley.   Last year, Compton became concerned with what appeared to be at best sloppy bookkeeping and at worst the misappropriation of city resources and funds in the public works department. In looking over the department’s books, he noted inconsistencies and omissions with regard to tasks performed, equipment and manpower utilized and material involved.
Concerned that something was amiss in the department, on October 1, 2013 Compton retained  for $25,000 the services of Imperial Beach-based Government Staffing Services, which was to include an arrangement with  Benjamin Miller, described in the purchase order as  a “principle accountant,” to perform “long term financial plan modeling.”
Miller’s audit confirmed Compton’s preliminary conclusions that some work in the public works department was not being properly documented and had not been properly instigated through the service order process which entailed proposals from public works staff being formalized into a report that was then signed off on by a vote of the city council. It appeared that at least a handful of public works undertakings over the last four years existed as “off the books” ventures.
Among the off-the-books projects was the construction of a set of speed humps in the 700 block of Canary Street, where councilman Frank Gonzales resides. The only documentation relating to that project was a service request dated September 24, 2008 by then Second District Councilman Richard DeLaRosa seeking the speed bumps and a subsequent endorsement of the project by city’s traffic safety committee on August 12, 2009. All of the other formal requirements for the project’s approval requested by citizens through a Public Records Act request  were not contained in city files. One such requirement is a petition seeking speed humps signed by 70 percent of the homeowners in the area. No such petition was on file. Neither was there indication that the city had billed the affected residents for their share of the cost of the project, which is required for speed humps to be installed, or that those payments had been received. Nor was a required traffic engineering survey of the speed of vehicles on that stretch of Canary Street conducted, leaving the city with potential liability issues.  There was no work order for the project, no invoice for materials used and no time sheets for the time city employees spent installing the speed humps.  There is no record of the project having been presented to the city council for approval as required. Violated in the carrying out of the project were rules contained in a City of Colton Engineering Department Document entitled “Policy of the City of Colton Relative to the Use of Speed Humps for Traffic Speed Control on Public Streets,” which was authored by Jakher himself and recorded as an official city document on December 18, 2007.
The Sentinel, in connection with an inquiry into Colton Public Works Department operations that was independent of that undertaken by Compton but which traced much of the same ground, has learned of another “off-the-books” public works project was work on a wall behind councilwoman Susan Oliva’s home in the 800 block of Edgehill Drive that was carried out in July 2013. At that time, the Colton electric division was engaged with a properly ordered and documented removal of an abandoned city of Colton utility pole from an easement on Oliva’s property. The electric department service request contains the language “Amer will be making repairs to the block wall.” On that authority alone, the public works division with no description of the wall repairing project on private property, which in this case is owned by a member of the city council, and with no other work orders, no invoices for materials used and no time sheets for time city employees spent building the portion of the block wall on Oliva’s property, the work was undertaken and completed.
The full range of “off-the-book” and other questionable activity uncovered by Compton in the public works department is not publicly known at this point. Compton did not respond to the Sentinel’s request for an interview this week. One knowledgeable source told the Sentinel that Compton’s inquiry had uncovered the matter relating to the unauthorized Canary Street speed humps construction but had not delineated the off the books wall construction on Edgehill Drive.
Compton, in following up on the information gleaned from the audit, utilized his authority as city manager to make expenditures of up to $25,000 without prior city council approval to retain, at a cost of $7,700 an investigator to look at the circumstance in the public works division. Given that the matter being investigated touched on improvements to or enhancements to the street around property owned by a council member, Compton elected not to inform the council of the investigation until the probe was completed.
As the investigation progressed and inquiries were made within the public works department, the existence of the investigation became known to at least some staff members. Moreover the substance of the investigation could be readily surmised. By May, word of the investigation had reached at least some of the members of the city council. This spring, the council had scheduled a routine evaluation of Compton’s performance as city manager.  Normally, the city manager typically sits in on the executive sessions of the city council, which are held behind closed doors and out of the view of the public for the purpose of discussing issues such as litigation or pending litigation, negotiations, the proposed or actual purchase of real estate and personnel matters, all of which are deemed confidential. City managers are excluded from those closed sessions where their performance is a subject of discussion. At the April 1, May 23 and June 3 regularly scheduled meetings of the Colton City Council, closed session “public employee performance evaluation [s]  pursuant to Government Code Section 54957 Title:  City Manager” were part of the agenda. The council adjourned into each of those three closed sessions and then returned from them without giving any indication of reportable action. Two days after the June 3 meeting, however, toward the end of the business day, Compton was informed that he was being placed on administrative leave. He was then abruptly and ignominiously walked out of City Hall by a plain clothes police officer.
A terse announcement that Compton had been suspended, pending  a review of “certain personnel actions taken “was provided to the press. Compton’s right to confidentiality was cited  when request for substantive details were made.
The city council assigned Cristina Talley, the city attorney, to carry out a review of Compton and his action.  Simultaneously, Ward, the police chief, was tapped to fill in for Compton.
Expectations that Talley might report back to the council and the public quickly were not met.  Little in the way of substantial information about why Compton was not in place was provided. Some of the more vocal members of the community expressed dismay over the wisdom and timing of the suspension, given Compton’s financial expertise and the city’s dependence on his guidance in formulating and meeting the late June deadline for the city’s 2014-15 budget, which corresponds with the governmental fiscal year running from July 1 to June 30.
It then emerged that the council that suspended Compton had been sharply divided, with Mayor Sarah Zamora, and council members Frank Gonzales, Susan Oliva and Isaac Suchil favoring the suspension and council members Frank Navarro, David Toro and Deirdre Bennett either opposed to it or skeptical about its reason and justification.
With Compton yet slowly twisting in the wind, in early July, the council brandished documentation at a public meeting some of the members elliptically suggested related to the “certain personnel actions taken” by Compton that led to his suspension. It was further indirectly suggested that Compton had exceeded his authority by micromanaging operations in the public works department and had engaged in expending $81,851 relating to the public works department he was not authorized to spend. Of that $81,851, $75,000 of that total was identified as the $25,000 purchase order with  Government Staffing Services for Benjamin Miller’s audit; $12,000 worth of work by Fullerton-based Revenue & Cost Specialists, Ltd. for a development impact report; a $25,000 contract with Lancaster-based Passantino Anderson Communications LLC  for work on the Colton and Grand Terrace Wastewater Project and $13,000 worth of work by the Carlsbad-based firm of BW Research Partnership also on the Colton and Grand Terrace Wastewater Project. Suchil also mentioned the $7,700 Compton had used to retain the yet-unidentified investigator to look into public works operations.
Ensconced in his home in Redlands and forbidden from returning to Colton City Hall at least until Talley’s review is completed, Compton was unable to respond or otherwise defend himself. Nonetheless, some familiar with the situation noted instantly that any accusation of misappropriation or misapplication of money could not hold up, given that as a condition of his hiring as city manager Compton had been given the discretionary authority to sign contracts for $25,000 or less without needing prior council approval. Moreover, the need for the Passantino Anderson Communications and BW Research Partnership consulting contracts had been discussed during staff meetings and in negotiating sessions between Grand Terrace and Colton in which Jakher was involved.
Those within a select circle of knowledge at City Hall recognized a discrepancy between representations and suggestion emanating from City Hall relating to Compton’s suspension and information they possessed.
On July 13, a group of Colton residents – Steve Cade, John Anaya, Donna Lawrence, Ron Lawrence, Gary Grossich and Linda Tripp – signed a letter of complaint to the Colton City Council, Ward and Talley in which they cited the circumstances relating to the unauthorized Canary Street improvements and the unauthorized construction work on the wall at Oliva’s home.
“We are asking for an immediate investigation into the city of Colton Public Works Department and their handling of these two situations, as well as investigating what role and level of involvement council members Frank Gonzales and Susan Oliva had regarding these violations,” the letter states. “It is our understanding that city manager Stephen Compton was investigating potential wrongdoing within the public works department just before Compton was placed on administrative leave. Our complaint  may or may not be part of the original investigation Mr. Compton initiated, but we want to make sure our complaint stands on its own merits and is investigated as such.”
Roughly a week after the complaint letter was sent, Ward tendered his resignation as city manager. Before doing so however, he assigned Talley to carry out an investigation of the complaint letter’s accusations.
Talley has not returned numerous phone calls from the Sentinel seeking her input.
With respect to the action taken against Compton, councilman Frank Gonzales this week told the Sentinel, “We put him on admin leave. We are looking into things that happened that we are unhappy with.”
Gonzales said he anticipates that the city attorney will provide documentation of the action Compton took that will delineate how he exceeded his authority.  “It will be another week before we get the results,” Gonzales said.
The problem was that Compton went off on his own, initiating action that had not been directed or even discussed by the city council, Gonzales said. “There was an accountant hired by him,” Gonzales said. “We never approved anything like that. The council never knew about an investigation  and never knew what the investigation was about.  I can’t say any more because it would be likely to jeopardize the outcome.”
As to whether there had been any improper action by Amer Jakher, Gonzales said, “To my knowledge, no. If there was anything being done wrong [by Jakher], we would have authorized him [Compton] to look into it. At least, that is my opinion.”
Jakher, who is now serving in the role of city manager as well as public works director, told the Sentinel, “I am so sorry but I can’t say anything about that because we are not allowed to. This involves things that are a personnel matter and it involves attorney client privilege. Once things come out and we can disclose it, we will.”
Cade told the Sentinel, “It appears that Mr. Compton has acted within his legal authority as the city manager when he signed contracts and initiated audits/investigations into possible wrongdoing in the public works department. And it is only common sense that with that authority already in hand, he would not advise the council of these investigations since it appears that several council members directly or indirectly received benefits from these actions in the public works department.”
Cade continued, “My question to the city council is this: ‘Why have you placed Mr. Compton on administrative leave, yet you have done nothing with Mr. Jahker when there is already enormous amounts of evidence indicating wrongdoing? Is it because of the personal relationships Jahker has with many council members?’
“This has the appearance of favoritism and must be addressed at once,” Cade said.
Grossich told the Sentinel, “I’m surprised Councilman Gonzales continues to put himself out as the mouthpiece for the Council. In reality, he should be recusing himself from any comment or involvement in this situation until his role in the investigation into the unauthorized speed humps installed on his street is determined.”
Grossich said, “It appears Mr. Compton’s big mistake was looking into potential wrongdoing by a department head who it appears had performed favors which benefitted certain council members. It’s pretty obvious when you look at the way the two investigations are being handled and the two individuals in question are being treated, that something is seriously wrong. The city council placed Compton on admin leave while appointing Mr. Jakher acting city manager. At the end of this embarrassing episode, I hope ethical judgment and fair decision making will prevail over personal favors and friendship.”