The Joplin Globe, Joplin, MO

Local News

April 25, 2012

Audit probe under way in Tar Creek cleanup work

MIAMI, Okla. — A contract awarded for cleanup work at the Tar Creek Superfund site is being examined by the Oklahoma State Auditor and Inspector’s Office for possible irregularities.

Gary Jones, state auditor, in a telephone interview Wednesday, said the investigative audit was requested in an April 21, 2011, letter from Oklahoma Attorney General Scott Pruitt. It will be completed in a month or so.

Pruitt, in his letter, said, “I have determined that these concerns are serious in nature such that an investigation of the matter is warranted.’’

The audit was launched shortly after the attorney general’s staff received, according to the letter, “a large quantity of documents gathered and supplied in support of the several allegations’’ from the office of U.S. Sen. Tom Coburn, R-Okla. A spokeswoman for Coburn could not be reached for comment on Wednesday.

“We received a request to look at something,’’ said Jones, state auditor. “There are no details about that request.’’

The Lead-Impacted Communities Relocation Assistance Trust, which has been in charge of the buyout and relocation of residents from the former mining communities of Picher and Cardin since 2006, voted on Nov. 10 to hire the law firm of Lester, Loving & Davies, of Edmond, to represent the trust with its legal matters.

Andy Lester, attorney for the trust, could not be reached for comment on Wednesday. Mark Osborn, a Miami physician who chairs the trust, through an office spokeswoman on Wednesday said he had no comment on the investigative audit.

In addition to the investigative audit, the trust was sued in April 2009 by a group of Picher-Cardin residents who alleged the trust low-balled their federally funded buyout offers. The trust has countered that allegation by saying its average buyout offer was higher than the average offer in the state-sponsored buyout in 2005. That suit is continuing.  

Jones said the audit, when it is completed, will be turned over to Pruitt who will decide whether to release it or give permission to the state auditor’s office to release it.

“The contents of the audit will be confidential until the attorney general releases it,’’ he said, noting that audits requested by the attorney general are not subject to the state’s open records act.

In the letter to Jones, Pruitt identified 17 questions relating to specific activities involving the trust and a cleanup project. In  addition to buyout and relocation, the trust has been responsible for the demolition and reclamation of the communities.

The letter, obtained by the Globe, asked, among others, these questions:

— Were bids solicited, received and contract awarded pursuant to the provisions of the Public Competitive Bidding Act of 1974?

— Is there any evidence of an agreement or collusion among bidders, prospective bidders and/or material suppliers in restraint of freedom of competition, including, but not limited to, whether the winning bidder served as a “straw bidder’’ for an actual other person or entity? If so, was a knowingly false affidavit of non-collusion filed in support of a bid? Were the rights to the contract unlawfully transferred from the winning bidder to another person or entity?

— Is there any evidence of an illegal conflict of interest between the entity awarded the winning bid and any trustee of the public trust or its chief administrative officer?

Questions also were asked about possible violations of the state’s open meeting and open records law.

The buyout

The Lead-Impacted Communities Relocation Assistance Trust was formed to buy out homes and businesses in Picher, Cardin and Hockerville after a report in 2006  by the U.S. Army Corps of Engineers suggested underground mining posed a collapse risk to those communities. The trust spent $46 million buying out those homes and businesses.

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