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Technology agency blasted by audit

Technology agency blasted by audit

Auditor cites financial, political issues with state-created agency

December 2nd, 2010 in News

State Auditor Susan Montee said Wednesday the Missouri Technology Corp. - a state-created not-for-profit agency intended to help improve Missouri's economy - had a number of record-keeping issues and is "holding a bunch of money that they need to be making some changes in getting out the door."

And, she said, she delayed issuing the report for more than a month "because I didn't want the issues inside the audit to get short-shifted by issues that might have come up in the campaign."

Montee, a Democrat, last month lost her re-election bid for a second, four-year term to Republican Tom Schweich.

During the auditors' exit interview with agency managers, Montee said, "The executive director basically threatened my staff, saying that they had been looking into various jobs that my auditors had worked on, and thought that there might be conflictof-interest issues."

And, she said, that same director - who isn't named in the 29-page audit report, but whom she identified as Jason Hall - "pointed out to my staff members that he was a good friend of Tom Schweich's and had been discussing various aspects (of the audit) with him."

However, Schweich told The Associated Press on Wednesday he didn't recall speaking to Hall about an audit. Schweich knows Hall from their previous work at the same law firm, but doesn't consider him a close friend.

Montee called the MTC audit "a very difficult and unpleasant experience," noting: "We had to limit the scope, because we were not given access to various documents.

"It was a fight to get information at every turn."

And, Montee said, the agency also took a long time to provide its written responses to the audit's findings.

While she delayed issuing the report so it would be reviewed on its own merits, and not as a part of the election battle, Montee said: "Part of the reason I was surprised by the problems that we had with MTC in doing this audit is that most of the individuals involved with the findings that were real problems are no longer with MTC.

"I am unclear as to why we ran into the roadblocks that we did."

Lawmakers in 1994 created the Missouri Technology Corporation to "contribute to the strengthening of the economy of the state through the development of science and technology."

Its board includes the University of Missouri system president (or his designated representative), the state Economic Development director (or designated representative), a state senator, a state representative and 11 residents appointed by the governor, with nine coming from the private sector.

The MTC's director and budget and planning manager are both full-time Economic Development department employees.

"There were a number of problems with conflicts-ofinterest that occurred," Montee told reporters during a news conference that, she said, may be her last as state auditor.

"There were board member conflicts - you had several members of the (MTC) board that were simultaneously serving on boards of non-profit entities that were getting money through MTC."

Although those conflicts likely did not violate state law, she said, "You have a fiduciary duty problem - there's a question as to which entity gets a higher priority."

She and the MTC agreed the agency created a conflictof-interest policy in June 2009, after the audit work began. The agency's response noted the policy was written and approved "after the confirmation of the current executive director" in April 2009.

The audit questioned the process used to hire the Bryan-Cave law firm as general counsel, saying it "was not conducted in accordance with the criteria stated in the RFP."

The MTC noted a new law firm was chosen in 2010, with no challenges from the auditor.

Montee also reported the corporation was negotiating with a consulting firm while "the former executive director," later identified as Rob Monsees, "was seeking employment with the consulting firm while the negotiations were in progress."

She said auditors also found that Monsees approved "extravagant" expenses for the consulting firm, including group meals that, at least in one case, averaged $79 per person, a $2,000 first-class plane ticket and vehicle rental fees in Memphis, Tenn.

Monsees told The Associated Press he did not recall those particular expenses, but said: "My general impression is that (the consultant) was very helpful to the state of Missouri."

The MTC's response also noted it "already produced many outstanding accomplishments" with its state money, including securing $20 million of capital for Missouri-based businesses through an investment of about $1 million.


Auditor's report

Missouri Technology Corp.