Legislative committee declines to forward NDSCS audit information to attorney general
BISMARCK — A state legislative committee declined to forward information regarding a negative audit of the North Dakota State College of Science to Attorney General Wayne Stenehjem's office Wednesday, July 17.
Rolla Democratic Rep. Marvin Nelson cited a state law requiring the Legislative Audit and Fiscal Review Committee to present information to the attorney general when it has reason to believe a state officer or employee has broken the law related to the use of public funds. The law allows the attorney general to commence an investigation and prosecute state officials.
"This is the process that's laid out," Nelson said. "We're not the jury, we're not the judge, but there may be a law broken here."
Included in Nelson's motion was a recent audit of the Indian Affairs Commission that found the agency misspent $7,800 in state funds on gift cards for youth conference attendees. The committee narrowly voted against forwarding the information near the end of its daylong meeting, but the issue is expected to resurface later.
"I think voting on it today is a little premature," said Bowman Republican Rep. Keith Kempenich.
Earlier in the day, NDSCS President John Richman disputed some of the audit findings in a presentation to state lawmakers but said his institution is making changes in response to the report.
State auditors said in April that a college administrator was directly involved in hiring a consulting firm that employed his wife and didn't adequately disclose the relationship. They also reported that college officials failed to provide information they requested regarding the procurement process, which they said may violate state law.
Richman told the committee that "there was no policy violation" on the first issue because Tony Grindberg, the college's vice president of workforce affairs, didn't recommend or select Flint Group, where his wife works as chief financial officer.
"The employee was fulfilling their job duties as a courier of information," Richman said.
Grindberg, who's a Fargo city commissioner and a former state lawmaker, previously said he "probably" should have disclosed his wife's work affiliation on a statement of business interest form. Richman previously said Karen Grindberg's work with Flint Group was known by college administrators and others.
Further, Richman told lawmakers that college officials didn't "obstruct or mislead" the auditor's office because they "never received a specific, written request for emails." State auditors ultimately obtained the emails through a records request to the North Dakota University System office.
"Our interpretation of the two questions that came to us were very subjective and open to interpretation," Richman said Wednesday. "We interpreted that as documents that pertain to the selection of the company. And again, that selection process was done over the phone with myself and the owner of the company."
State Auditor Josh Gallion disagreed on that point, highlighting for legislators emails included in the audit report showing a NDSCS official agreeing that there were "no email correspondence regarding a proposal or procurement of services for the Workforce Career Academy between NDSCS and Flint Group."
"I feel that the auditors were very thorough in their requests," Gallion, a Republican, told lawmakers.
In an interview during a break in the committee meeting, Richman said he and the auditor may have to "agree to disagree."
But Richman told lawmakers the college has revised its business interest form because it was "somewhat confusing" for employees and tasked a procurement employee with more thoroughly tracking the documents. He said they also made conflict of interest training a standalone feature rather than part of their overall guidance.
Regarding the dispute over emails, Richman said college officials realized they needed to ask better clarifying questions of auditors. To that end, he said they've established a "communication plan."
The State Board of Higher Education, which oversees the public campuses in the state, late last month called for an "action plan" for the college that was still being finalized as of early Wednesday afternoon.
Also in late June, the board approved Richman's contract for two years and a salary of $204,296, a 1.2% increase from last year.