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Seattle port legal bill over state audit findings passes $1 million

Seattle port legal bill over state audit findings passes $1 million

Repercussions from last year's Washington state audit that found issues with contracting at the Port of Seattle continue to mount, with the port's legal bills related to the audit's findings passing the $1 million.

   The 350-page state audit, which covered port operations from 2004 to 2007, reported nearly 50 indications of financial and contracting irregularities. In addition, the state auditors said the port wasted nearly $100 million in taxpayer money through improper construction contracting. Released in December 2007, the audit led to an ongoing U.S. Justice Department investigation into the accusation of fraud at the port. The state auditor's office was unable to determine fraud due to state regulations putting the collection of substantiating evidence outside the legal mandate of the office.

   Most of the legal bills racked up by the port have been paid to two Seattle firms hired by the port — Danielson Harrigan Leyh & Tollefson and Yarmuth Wilsdon Calfo. The two were hired to examine the state audit and identify flaws in the auditor's findings and potential areas of focus by the Justice Department.

   According to the Seattle Post Intelligencer, the port's legal bills from the two law firms have mainly covered interviews with port staff and elected officials, preparation of documents for federal investigators, responses to media requests for documents relating to the federal investigation and conferences with the port's spokesperson.

   The accusations in the state audit being looked at most closely by the Justice Department focus on the way contracting procedures were followed, what these violations of state and port policy cost taxpayers, and how port staff kept the information from the elected port commission.

   The state auditor found most of the $97.2 million in alleged taxpayer money squandered by the port stemmed from two contracts related to the construction of a third runway at Seattle-Tacoma International Airport, which the port authority manages in addition to the port.

   One of the contracts, awarded to consultant Parsons Brinkerhoff, ballooned from an original estimate of $10 million to $120 million without competitive bids. The audit found that port engineers could have done the job much cheaper and saved taxpayers $60.5 million.

   The second contract, awarded to construction firm TTI, came in $32.5 million higher than the port's original estimate. The audit found that numerous violations of state laws covering contracts by public agencies were violated.

   In addition to the state law violations, the audit also found port officials did not follow proper port contract bidding procedures and in some cases allowed vendors to make decisions reserved for port officials. The audit also claimed that some port staff members impeded audit investigators and refused to certify the accuracy of the information that was provided. In some cases, the audit investigators found that records were altered before being turned over by the port.

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