Benji Hardy has provided a longer, detailed account of events at Joint Audit Committee this morning when legislators prevented Brad Choate from giving his side of his firing as head of the University of Arkansas Advancement Division. He begins with the whistle-blowing John Diamond, ousted as the UA’s top spokesman, after what he says were objections to the UA’s resistance to public accountability. Diamond insists he can prove Chancellor David Gearhart supported destruction of material relevant to a recent prosecutorial review that ended with a recommendation for no criminal charges.
“I’m shocked. It’s outrageous,“ said John Diamond of the vote this morning by the Joint Audit committee to prevent testimony from being given by Brad Choate and Joy Sharp, the UA Advancement employees who lost their jobs over that Division’s budget deficits. Diamond, who was formerly the UA’s top spokesperson before being fired earlier this year, has said that Chancellor David Gearhart ordered the destruction of documents related to the audit. It was those allegations in a September meeting of the committee that led Chief Legislative Auditor Roger Norman to keep the audit open and refer the matter to the Washington County prosecutor for investigation.
In September, the committee heard extensively from Gearhart and other UA officials, who painted a narrative that pins the blame for financial mismanagement solely on Choate and Sharp. This morning, Choate was supposed to deliver a statement to the committee that presented his side of what happened in the Advancement Division. But legislators — mostly Democrats — voted to suppress that testimony entirely. Because Choate is legally bound by an agreement to not “disparage” Gearhart, Treasurer Jean Schook, or Vice Chancellor Don Pederson, testifying under oath was the only venue in which he could deliver his side of the story. He’s relocated to Austin since leaving Fayetteville and he says he drove to Little Rock to deliver this testimony today.
It’s not clear whether Sharp intended to testify or not; she left as quickly as possible after the meeting acrimoniously concluded. But given her low profile and avoidance of media, it’s all the more upsetting that the committee didn’t afford Sharp the chance to make a statement. The Washington County prosecutor’s report released yesterday gives the impression that Sharp committed no wrongdoing intentionally, but rather that she was overwhelmed by her job and allowed to take the fall for larger oversights.
The legislators permitted only one person to give testimony this morning: John Goodson of the UA Board of Trustees. He said the Board is addressing any lingering issues associated with the Advancement deficits and their fallout. “We have heard you loud and clear,” Goodson reassured the committee. “[The Board] has accepted every single recommendation made by Roger Norman.”
Immediately after Goodson finished his brief statement, Republican Sen. Bill Sample made a motion to accept the audit as reviewed, which would effectively end the legislative conversation about the entire matter. Sen Linda Chesterfield, a Democrat, seconded. Rep. Nate Bell and committee co-chairs Bryan King and Kim Hammer argued against the motion, but it passed on a roll call vote by almost a 2-to-1 margin. Most of those wanting to allow Choate and Sharp to testify were conservative members. After the motion passed — thus formally closing the door on the audit — Hammer stated that he would still like to allow Choate and Sharp the chance to speak before the committee, though it broke with protocol to do so. Any objections, he asked? Sample loudly voiced his objection, so the committee adjourned.
Why actively prevent the two people at the center of a controversy over millions of dollars of public funds from speaking before the committee charged with auditing public funds? Chesterfield said that once the matter had been turned over to the prosecutor’s office, it was no longer the legislature’s responsibility.
“Our role is not a quasi-judicial body, and that’s what we’ve become,” she said. “We don’t have to hear both sides of a case…we’re not in court. Our only role was to determine whether the money was spent properly or not. It was turned over to the prosecuting attorney. Once it goes to them, we’re really out of it. But we’ve chosen to come back in and deal with things that I don’t think are within our purview.”
That may be technically accurate, but it’s a flimsy reason for refusing to hear testimony on a matter that’s so clearly within the public interest. Legislative committee meetings regularly discuss ancillary topics for hours and hours on end. Again, because of Choate’s binding legal agreement, this was the only venue in which the public could hear his account of what happened with its money. There’s only one motive for so many legislators taking a selectively narrow interpretation of what’s appropriate for a discussion: they simply don’t want to hear it, or don’t want the public to hear it.
Hammer said he was surprised and disappointed by the committee’s vote. “I would have thought that the majority of the committee would have wanted to have heard what was said, but I think the timing of the prosecutor’s report and the fact that there was no illegal activity on their part — I’m speculating — might have influenced some of the committee.”
Choate says he’s going back to Austin and washing his hands of the whole matter. “I think I’m about done with this. People here aren’t interested in the facts,” he said after the meeting. He showed reporters a binder containing his never-to-be-delivered testimony; its front cover was decorated with a printed picture of a man lying under a bus.
John Diamond seems less inclined to drop the matter. In a letter to Roger Norman, Diamond states that the Washington County prosecutor’s report issued yesterday contains a serious error. The question concerns the destruction of a particular document, which the prosecutor says fell outside of the time frame described by the FOIA request made by the Democrat-Gazette of the UA. This document was present at a January 14th meeting of UA division heads, and Diamond says the Chancellor had angrily told the assembled UA employees to “get rid of it.” Indeed, the prosecutor’s report offers an incomplete account of this episode, citing conflicting statements of whether there is evidence of Gearhart issued this directive and concluding that the question is irrelevant because of the FOIA request’s time frame. But Diamond says the request did indeed fall within the scope of the FOIA request and requires further investigation.
In the September committee meeting, Gearhart flatly stated under oath that he never ordered any document destroyed; Diamond said he did. The Washington County prosecutor’s report dodges this question of possible perjury by saying legislative testimony at the Capitol is outside of Washington County’s jurisdiction. Diamond seems confident the record will still bear out his story over Gearhart’s: his letter to Norman also asks that the auditor refer the perjury question to the Pulaski County prosecutor.
Also: the audit itself is “terribly flawed,” Choate asserted. He says this is because the audit was performed jointly between Legislative Audit and internal auditors at the UA.
“There are some massive errors….they were trying to work together and it didn’t work. So the part of the audit performed by Legislative Audit I think is very accurate. The part that deals with me and some other things internal, they relied on some work done by one of the three people I can’t disparage…it’s just flat out in error. And I can prove it.”
“I can prove it up there,” he corrected himself, gesturing to the witness stand in front of the emptying committee room. “I can’t prove it standing here.”
Diamond’s letter follows:
Dear Mr. Norman and Ms. Williams:
A significant error in Mr. Bercaw’s report has a material effect on his conclusion regarding whether or not the budget document Denise Reynolds distributed on Jan. 14 was responsive to a pending FOIA request.
Mr. Bercaw erroneously stated that the budget document fell outside of the timeframe addressed in a Jan. 10 FOIA from the Arkansas Democrat Gazette. To support that conclusion he cited a paragraph in that FOIA pertaining to documents covering Jan.1, 2012 to June 30, 2012. However, it was the preceding paragraph in the Jan. 10 FOIA to which I was referring, and which asks specifically for the following:
“We ask for detailed, complete, line-by-line budgets of Advancement and its units—that go beyond the framework of total salaries, total wages, total fringes, total M&O and grand totals—for Fiscal Years 2011, 2012, and 2013 (as the latter stands now). (e-mail from Dungan, Hammersly, and Cook, Jan. 10, 2013)”
As noted in Mr. Bercaw’s report, the document discussed at the Jan. 14 meeting was the latest budget breakdown of Advancement’s FY13 revenues and expenses—clearly a matter covered in the above-noted FOIA request.
I am hopeful that you will bring this to the attention of the committee chairs and the committee itself during today’s hearing. Furthermore, it should keep open the question of whether or not the chancellor’s directive to “get rid of” that document was a violation of Arkansas’ FOIA law. The prosecutor’s error in applying the wrong paragraph (cited in his report) when reaching his conclusion should result in the committee setting aside that particular finding until it can be revised.
Finally, I also respectfully request that you ask the Pulaski County prosecutor to investigate the conflicting statements made to the Legislative Audit Committee on September 13 regarding what Chancellor Gearhart said to the Advancement Division’s leadership team on Jan. 14. This matter is important to the credibility of the investigation, the management and governance of the university, the taxpayers and tuition payers, and to the reputations of Chancellor Gearhart and me.
John N. Diamond
The University also issued some word salad late in the day. In short: Never been indicted.
FAYETTEVILLE, Ark. – University of Arkansas spokesperson Mark Rushing issued this statement today on behalf of the university:
“We appreciate the work of the Division of Legislative Audit, the University of Arkansas System Internal auditors, and the Legislative Joint Auditing Committee in reviewing the Advancement Division’s deficit, providing recommendations, and completing the audit process. We also appreciate the prosecuting attorney’s office for its independent and thorough investigation of the items referred by Legislative Audit. The prosecuting attorney’s report was consistent with the University’s long-standing findings that the Advancement Division’s deficit did not involve theft, fraud or misappropriation of funds.
“Along with the proactive measures we have taken to strengthen our financial processes and systems, we are actively implementing all of the recommendations provided by Legislative Audit. Chancellor Gearhart asked for the audits and we believe the results will make the University’s fiscal checks and balances stronger than ever.
“We recognize that the University of Arkansas is a public trust and we take that obligation seriously. We have and always will strive to work in the best interests of all Ark