Independent auditor Gayle Botley delivered a negative audit of the Port Arthur Economic Development Corporation to Port Arthur City Council this morning, for the third year in a row.   Among other issues in the audit, Botley said the EDC has not enforced compliance with contracts.

"During our compliance review of the above contracts, we noticed several instances of non compliance," Botley said, listing problems that were mentioned in the previous two audits and not corrected.  "Billings were incurred from third parties by PAEDC before Council approved the contracts; and then PAEDC did not manage the contracts in the proper manner to maintain the budget discipline approved by the council."

EDC President Ike Mills said that some members of the city council and city staff have worked to influence the audit.  Listen    Download

"There is a concerted effort to put the EDC in an awkward position," Mills said.  "There is a concerted effort by some council members, staff members, to actually take over the EDC."

Council Member Michael Shane Sinegal agreed that some members of the city council have singled Mills out for criticism, but sought direction from Botley. Listen    Download

"As council people, we have eliminated the EDC attorney, our city attorney is acting as the EDC attorney, that's one thing we tried," Sinegal said, adding the city council has also made changes on the EDC board.  "I don't see anything left.  You see anybody else to eliminate?"

"I'm standing here giving you the independent auditor's report today," Botley said.  "I'm trying to answer your questions to the best of my ability, but I will not get into your personnel issues."

Mayor Oscar Ortiz complained that the EDC continued to operate without changes despite the past two audits. Listen    Download

"As we have been told by the auditors, adding additional policies and procedures for control purposes would not be effective as long as the internal control environment, which is the foundation for all components of internal controls, is ineffective," Ortiz said.

The city council was visited by Jennifer Walker of the Sierra Club, who presented the "Bays in Peril" report, which seeks legislation to protect the freshwater inflow to coastal bays and estuaries, including Sabine Lake.  On Monday Walker made the report to Jefferson County Commissioners Court.  Listen    Download

"It has been really positive," Walker said, adding that the reaction has been the same in other coastal communities.  She said that she expects coastal legislators to prevail in passing the legislation.