Town Council Closes Out Lakeview Avenue Bridge Project

The New Canaan Town Council on Wednesday unanimously approved two appropriations to effectively "close out" the controversial Lakeview Avenue Bridge project, which was completed in 2009 after being delayed more than a year due to arbitration.

Specifically the Council approved $1,554,888 that was already spent on the project, but not formally appropriated due to improper procedures in the finance department, as well as $24,176 to cover the remaining amount owed to BL Companies for engineering services and related arbitration costs.

In addition the Council voted unanimously to give First Selectman Robert Mallozzi III permission to apply for state reimbursement for the project.

Town Council member and secretary Kit Devereaux explained that the total cost to the town for the bridge replacement project is $3,087,482. She said the town is expecting to receive about $1.5 million in reimbursement from the state.

"I think most people in town are sick to death of hearing about this," Devereaux said, adding that the Council's approvals that evening should "finally" put the project to bed.

Following state reimbursement, the town's share of the bridge project, Devereaux said, will be about $1,531,000 — about $902,000 of which is for legal expenses associated with the arbitration.

Town Council members were shocked to discover last year that an arbitration settlement of about $650,000 had been paid out of the town's capital budget for the project without first getting approval from the proper town bodies, including the Town Council.

Town officials have credited new Chief Financial Officer Dawn Norton with discovering the procedural errors — altogether she identified more than $1.5 million in funds that were spent on the project without being properly appropriated.

The discovery of the financial missteps — which occurred during former First Selectman Jeb Walker's administration — has prompted Mallozzi to call for a "forensic audit" of all the town’s capital projects during the previous four years.

Town Council member Tucker Murphy explained that the $1,554,888 is to cover all of the expenses associated with the project which had not been approved by the proper town bodies previously. She said Norton made the calculation "after going through all the invoices, all the expenses, and determining what had been appropriated and what had not..."

Town Council member Roger Williams commended Norton for meticulously going through all the past transactions to arrive at a figure.

Prior to disovering that the funds for the bridge project were not properly appropriated, Norton reportedly noticed that funding for another capital project in the 2010-2011 town budget — $400,000 for a new chiller at East School — had also been spent without proper approval.

Meanwhile the town is working to establish an Audit Committee that will be responsible for auditing town financial transactions and ensuring compliance with procedures. Providing the committee is established via town charter, all third party auditing entities would report to it. Currently the Town Council's Ordinance Committee, headed by Council Vice Chairman Stephen Karl, is working on the details, including how many seats the new committee will have.

During wednesday's meeting Town Council member Kenneth Campbell said he wanted to know if and when the Council would be acting on the recommendations of the Lake Avenue Bridge subcommittee, which was formed last year to conduct a review of the abitration settlement, as well as the procedural missteps.

A Sept. 2011 draft report from the subcommittee goes into detail about what occurred. It concludes that "over the course of the project, procedures were breeched, errors were made, and unwise choices were too common."

"However, despite this disappointing record, there is no evidence that personal gain or corruption played any part in the proceedings. Instead, a lack of foresight, a lack of control, and lack of communication ruled the day," the draft report states.

"I'd like to have some kind of discussion either tonight or in the future about lessons learned from this... " Campbell said. " ..the recommendations from [the] committee, where do they stand... and some discussion about what can we do to have better controls, better reporting, better communication between the finance department and the town bodies."