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Career Service Authority wars with Denver Auditor's office: The "Inside Job" documents

"During my tenure as Auditor, I have never had to write a transmittal letter as detailed and scalding as this one," Denver City Auditor Dennis Gallagher wrote in the cover letter to his office's recent audit of the Career Service Authority, the agency that provides human resources for 8,500 Denver employees. And that audit -- which is reproduced below -- doesn't address several of the other incidents outlined in my story about problems at the CSA, "Inside Job."

In the summer of 2009, employees with the CSA's Recruitment Section filed complaints about the behavior of Troy Bettinger, their supervisor. In the past, the CSA had contracted with the Mountain States Employers Council, a local non-profit, to investigate formal complaints. But in this case, CSA Director Jeff Dolan, who'd hired Bettinger, took another tack: He retained the services of Ashley Kilroy, a local attorney who had been on the Career Service Authority Board, the CSA's advisory body, and had also been involved in hiring Dolan. Kilroy's August 12 report, shown below, concluded that "Mr. Bettinger's conduct, while inappropriate and uncomfortable, has not been hostile or intimidating." Kilroy went on to suggest that the employees' concerns about Bettinger might have been due to their resistance to changes in the division, noting that they had "engaged in behaviors towards the leadership that is accurately described as hostile and defiant."

Then-Assistant City Attorney Chris Lujan had asked Kilroy to investigate the complaints, and a few days after he received her report, Lujan was made head of the city's Employment Law Unit. It was a move that didn't sit well with some of Lujan's colleagues. Luis Corchado, assistant director of litigation for the City Attorney's Office, sent a letter to the CSA board, shown below, charging that Lujan's new job with the Employment Law Unit was an "unlawful promotion" that did not follow the competitive hiring process required by CSA personnel rules, and blaming CSA director Dolan for helping to push the deal through.

Lujan continued to be involved in the troubles within the CSA's Recruitment Section: He asked to represent the city when several laid-off employees there appealed their terminations, claiming that they'd been retaliated against, and when the employees dropped their appeals and instead took their complaints of discrimination to the U.S. Equal Employment Opportunity Commission, Lujan personally challenged those charges. Last October, Lujan left the City Attorney's Office to become the CSA's deputy director, a brand-new position in a cash-strapped city. Then in March, when Dolan stepped down, Lujan became the CSA's interim director.

Since 2009, the Denver Auditor's Office has released three audits and an audit alert, shown below, relating to the Career Service Authority; a fourth CSA audit is due out next month. Taken together, these audits outline what Gallagher calls a "recipe for disaster," including a hearings and appeals process that takes twice as long as in comparable cities; a department-wide, 37 percent failure rate for conducting mandatory annual employee performance reviews, twice as high as the city average; and a CSA board that has no minimal expertise requirements, provides little oversight of the CSA director and department policies, and is unable to come up with a consistent definition of what a merit-based personnel system is supposed to mean.

The audits have heightened tensions between the CSA and the Auditor's Office. E-mails between the two agencies, shown below, capture Lujan, while working as interim CSA director, calling the Auditor's Office a "hostile organization," and Gallagher responding by accusing CSA administrators of a "scandalous abuse of power" and having a personal vendetta against the Auditor's Office.

Page down to see more CSA documents: The animosity between the CSA and the Auditor's Office reached a fever pitch last month, when, in a written response to a nearly complete audit of the CSA's hearing and appeal process (shown below), the CSA board suggested that the Auditor had purposely timed the audit to coincide with (and possibly influence) a CSA personnel hearing that involved the Auditor's Office.

A week after the CSA board sent its fiery response, Auditor Gallagher fired back in a cover letter to the released audit (below). He called the CSA board's allegations "completely nonsensical," adding that he believed it was the CSA board, and not his office, that had a conflict of interest regarding the personnel hearing in question.

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Late last month, the CSA board took the fight to another front, appealing directly to the city's Audit Committee, the advisory body for the Auditor's Office. In the letter, shown below, the board notes that investigations by two independent attorneys concluded no laws were violated in the controversial layoffs in the CSA's Recruitment Section. One of those investigations, as it turns out, was the sexual harassment investigation by Kilroy, the former CSA boardmember. (The other was by another Denver employment attorney, Cathy Greer; the City Attorney's Office refused an open records request for a copy of that report, noting attorney-client privilege).

Read more about the CSA in our Calhoun: Wake Up Call archive: "Denver police chief may have fewer cops to police, thanks to Career Service Authority"

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