AUSTIN (KXAN) — An Austin Water Utility manager is being disciplined after three tough audits of the utility’s communications office that found alleged favors for vendors, “grossly uneconomical” use of city resources and an inappropriate business relationship, according to audits and a utility executive.
Kevin Buchman, a utility marketing services manager, was issued a pre-disciplinary action Thursday. Buchman will have three days to respond. The disciplinary action will be “officially issued next week,” said Daryl Slusher, assistant director of the utility.
Slusher said the disciplinary action against Buchman is related to problems found in the three previous audits, including Buchman’s oversight of a questionable advertisement deal and having a subordinate conduct a real estate evaluation on his house.
In a November audit, Buchman told investigators he had a subordinate employee, Jason Hill, conduct a real estate evaluation on his home. Hill is a licensed real estate agent and a former program manager in the utility’s communications and marketing department. Auditors classified that as a violation: “favor from a direct report.” Buchman also told auditors he is a lease foreman for a ranch and spent time working on the ranch’s lease while at work.
In a letter to the auditors, Buchman said he “took full responsibility for his actions.” Buchman also said the real estate evaluation had no impact on Hill or himself.
The investigations were spurred by allegations made to city auditors in March of 2016 that Buchman accepted a favor from a direct report and misused city resources, according to the audit.
- You can read the January and November audits of Jason Hill and the advertising vendor here and here.
- You can read the November audit of Kevin Buchman here.
The auditor’s office also received allegations against Hill last March that he “steers advertising dollars to his friends and other people with who [sic] he does business outside of work time,” according to the audit.
In a January report, auditors said they found evidence Hill solicited and accepted a favor from a city vendor whose invoices he approved, Austin Water’s public information and marketing office used city resources “in a grossly uneconomical way” to buy ads from that vendor and didn’t monitor the expenditures.
The evidence showed violations for “favor of a vendor” and “waste of city resources.” Hill began working at Austin Water in 2010. He is featured in several utility ethics videos.
In an interview with the city auditor, Hill said he asked a city vendor to assist him in building a website related to his secondary employment, according to the audit. Hill is listed as a real estate agent for Keller Williams Realty, the company’s website shows.
“According to Hill, the vendor provided this service free of charge. Hill described the assistance as a ‘professional courtesy,’” the audit states. “While Hill claimed in his interview with our office that he paid the registration fees for his website himself, Hill failed to provide evidence of this despite repeated requests by our office and Austin Water management.”
Hill told auditors he was not sure if he disclosed his ties to the vendor to his supervisor, Buchman.
And auditors found more problems with the advertisements.
The same vendor that helped Hill with his website provided utility advertising on seven of its own web address. Austin Water paid the vendor $67,000 for work from July 2013 through October 2016. During that time 55 people clicked on the ads and were directed to Austin Water’s website.
“Broken down, this is a cost of over $1,200 per click,” the audit states. In contrast, other city department ads have directed customers at a cost ranging from 87 cents to $6.65 per click.
Auditors called the return on investment “grossly uneconomical.”
Hill called the audit “exaggerated,” “biased” and said he was “disappointed by the tone,” according to a memo he wrote attached to the audit.
Hill said it is impossible, given his various past places of employment, not to have professional relationships with some vendors. Regarding the vendor’s help with website building, Hill said: “This expert decided with his own free will to pass along to me some basic aspects and nuances of website building. No money, promises or expectations were exchanged and there was zero impact to the city, utility or any of its stakeholders or customers.”
In a separate memo, Austin Water Director Greg Meszaros said it was inappropriate for Hill to use utility letterhead in response to the audit, and the opinions expressed in his memo were his own and did not reflect the utility’s perspective or the findings in the audit report.