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Error keeps mayor, city auditor at odds

Gallagher suggests politics in payroll flap; not so, official says

Daniel J. ChacC3N, Rocky Mountain News

Published September 14, 2006 at midnight

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The fiery feud between Denver City Auditor Dennis Gallagher and Mayor John Hickenlooper's administration is still burning strong.

Gallagher is crying foul over allegations lodged by the city in July that 10 employees, including his payroll clerk and four other workers in his office, had been overpaid for a year.

The allegations, which prompted Gallagher to threaten to hire an attorney, proved to be false. But the damage was already done.

"Frankly, we began to think that this was perhaps politically motivated and not something else," said the auditor's spokesman, Denis Berckefeldt, who was also erroneously identified as being overpaid.

But Bruce Backer, a division director for the Career Service Authority, the city's largest human resource agency, said the error was an innocent mistake. He denied it was the result of political maneuvering.

Lindy Eichenbaum Lent, Hickenlooper's spokeswoman, also said the mayor had nothing to do with what went down.

"This matter is between the Career Service Authority and the Auditor's Office," she said in an e-mail.

"It is our understanding that upon discovering the alleged overpayments, CSA - as required by law - notified the City Attorney's Office, which - as required by law - notified the Auditor's Office to enable them to investigate the situation and decide how to remedy it on their own."

Berckefeldt questioned the timing - the mayor and auditor were engaged then in a public debate over a plan to revamp the city's financial structure.

Said Lent: "The timing was purely coincidental as this issue and the proposed financial management reform are completely unrelated, involve different parties and their resolutions have been conducted completely independent of each other."

According to confidential documents obtained by the Rocky Mountain News, Karla Pierce, an assistant city attorney, wrote Gallagher July 5 to tell him that a group of employees had been overpaid "as a result of an error" by the CSA.

The error occurred because the CSA "failed" to change the employees' job classifications last year, Pierce stated in the letter. Pierce pointed out that it was Gallagher's responsibility as the city's accountant to get the money back.

Gallagher fired back his own letter two days later, saying his investigation had found that "these alleged overpayments may not be valid."

The auditor also wrote that the classification change had been made "rather curiously" by the Budget and Management Office when it was the CSA's responsibility.

Pierce responded July 18, saying her original letter "was not intended as a directive for you to collect these overpayments." She went on to write that information about whether employees had been notified about their changes "could not be substantiated" and that "there were no overpayments of wages."

Even though that issue was resolved, the tension between Gallagher and Hickenlooper continued.

But a month later, they announced a compromise over the mayor's proposed financial reforms.

Berckefeldt said he didn't know "what the upshot of all this is going to be," but he had harsh words for the CSA.

"The way they have handled this is just ineptness, incompetence and utter stupidity," he said.