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State Auditor releases results of investigation of city of Orr and Dill; no illegal activity found

State Auditor Pat Anderson released a letter outlining the results of an investigation into allegations made against former Orr city administrator and current state Representative David Dill. While the review began with allegations about Representative Dill, it resulted in greater concerns about how the city of Orr conducted its business. “Our review did not find illegal activity on the part of Representative David Dill or the City of Orr. We did find some minor legal compliance issues and a general pattern of lax financial oversight in the city,” wrote Anderson.“I was real happy to have the audit report come out,” said Dill. “We cooperated fully, all of the entities I worked for over the years provided the information the state auditor requested.“I’m glad no conflict of interest was found as had been alleged,” said Dill. “It is with some humility that I admit we made some mistakes along the way, during an incredible growth spurt in Orr and we were limited on resources and staff people.”The area of greatest concern involved the city’s role in monitoring and overseeing approximately $130,000 in grant revenues. According to Anderson, the city has an obligation to implement an oversight process to ensure that public funds entrusted to them are well spent. The Auditor’s Office found the following problems with the city’s grant oversight:• Employee time sheets were not maintained. • City staff time spent on grants was not documented. • Grant funds requested for one purpose were spent for another purpose.• City documents were not maintained in accordance with grant agreements. • The city should have entered into contracts with vendors under the grant agreements. • The city contracted with employees as independent contractors without contracts or job descriptions.In addition, other concerns were discovered. For example, the city opened a satellite TV account in the city liquor store under a false name to receive a lower residential rate in 2001. The city also improperly offered discounts to employees and engaged in other practices without the necessary statutory authority. In addition, annual audit suggestions were often not followed by city staff or elected officials.“The city of Orr’s record-keeping was sloppy and some records could not be found,” wrote Anderson. “When public dollars are at stake, it is advisable to keep thorough records and retain important documents so that the public can objectively evaluate, and hold accountable, their elected officials.”The Auditor’s Office did review, among other allegations, whether Dill benefitted from an alleged conflict of interest in his roles as Administrator of the City of Orr and Program Manager for Voyageurs Trail Society Inc., a recipient of city grant funds. The investigation conducted by the Auditor’s Office found no statutory conflict of interest in Dill’s dual roles. A conflict of interest generally exists when a public official is authorized to make a contract from which he would personally benefit financially. The investigation, however, found no evidence that Dill received a personal financial benefit from signing the contract. “While we found no evidence of a statutory conflict of interest, a better practice for public officials in these situations would be to avoid the dual roles to prevent the appearance of a conflict of interest,” wrote Anderson.The Auditor’s Office was also asked to review whether Dill billed both the city and other entities for the same travel. Dill did bill both the city and the Crane Lake Water and Sanitary District for just over $40 of travel expenses on March 19, 2001. Dill acknowledged the overpayment and repaid both entities in April of 2004.Finally, the Auditor’s Office was asked to examine whether Dill was sold discounted aviation fuel at the city airport. It was discovered that a discount was available to all city employees at the airport and at the city’s tourist center. Local government units do not have the authority to pay non-monetary fringe benefits, such as employee discounts, without specific statutory authority. The city discontinued the discount in 2003. However, Dill and others who rent hangar space from the city are still able to receive discounted aviation fuel. The Auditor’s Office recommended that the city discuss and document its pricing and discount policies for the airport. “It’s true the city could have done a better job on bookkeeping but there was no money misappropriated of misspent. It was just a matter of some records not being as detailed as they could have been,” said Dill.“In the end it was a good look back at a very complex and industrious and rewarding time for community and the report should be viewed by our community as a roadmap to the betterment and future success of the community,” said Dill.“I am proud to have served as city administrator and I looking forward to prosperous times for the community of Orr as well other communities in the district,” said Dill.

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