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Reval Rumble Redux – UPDATE: County Officials Say Nothing To See Here – UPDATE: Open Your Eyes

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Just when you thought Mecklenburg County’s flawed 2011 property tax revaluation Big Heist couldn’t possibly get any more criminally incompetent and professionally bungled, we learn that yet another shoe might be about to drop.

It starts with an email that Commissioner Karen Bentley received from a constituent expressing concern over the county’s recently hired new revaluation manager, Kimberly Horton, and possible “baggage” from Horton’s past – specifically, that Horton had resigned from her former job as tax administrator in Alamance County after being accused of “bid rigging” and conspiracy. The accusations related to – wait for it – Alamance County’s own property revaluation.

This from a 2009 WFMY News report:

Graham, NC — Alamance County is owed hundreds of thousands of dollars due to “bid rigging” and “conspiracy” by the former tax administrator and an appraisal company, according to documents filed by Alamance County Attorney Clyde Albright.

The documents were filed on Nov. 5 in an effort to dismiss a complaint from RS&M Appraisal Services, Inc. in which the company wanted $13,750 from Alamance County.

Albright said in court papers that the overpayments might not have been made, and RS&M’s bid might not have been accepted had McCarthy and former Tax Administrator Kim Horton not withheld information.

The county said the contract was obtained by “fraud and misrepresentation.” The county attorney said the contract should be declared “void ab initio” by the court.

Horton resigned in May amid controversy over the revaluation process.

Horton worked for RS&M and county simultaneously

Kim Horton presented RS&M’s bid to county commissioners on May 30, 2007 and recommended the county enter into an agreement.

The county attorney says Horton made the bid presentation without disclosing that at the time of the presentation and for six years prior, she was an independent contractor/employee of RS&M.

In court papers, the county alleges Horton did so ”with knowledge and intent to deceive” the commissioners.

The county attorney said in court documents that the “concealment was calculated to deceive” and that under the circumstances McCarthy should have disclosed his “business and personal relationship” with Horton.

In deposition testimony, Horton admits she had a business relationship with McCarthy and RS&M, which began in 2001.

She admits in her testimony that she received monthly paychecks from RS&M while employed as tax administrator.

RS&M was not the lowest bid. Horton and Ronald McCarthy allegedly knew this and “intentionally withheld this key information” from the commissioners in order to ensure the bid would be accepted by the board, according to court papers.

Horton’s alleged deception goes back even further, according to the documents.

She admitted in testimony that she failed to disclose her employment with RS&M during her job interview process for tax administrator, even after the interim tax administrator suggested to her that she should disclose the information.

Horton and McCarthy allegedly conspired to overcharge

Alamance County and RS&M entered into contract on June 4, 2007 with a base fee of $275,000 to be paid in 20 equal installments of $13,750,000.

In court documents, Alamance County’s attorney alleges that RS&M President Ronald McCarthy and Tax Administrator Kim Horton “engaged in a plan” in which extra contractual monthly invoices were prepared by McCarthy and sent to and approved by Horton.

The county attorney said McCarthy and Horton’s actions “constitute bid rigging, conspiracy, combination, or unlawful act in restraint of trade.” Under the law, any person who engages in that shall be guilty of a felony.

The invoices submitted by RS&M to Alamance County and approved by Horton were higher than estimates for comparable jobs or previous bids on similar jobs in other counties, according to documents filed.

Alamance County’s attorney said RS&M’s bid might not have been accepted by commissioners had they received full disclosure of Horton and McCarthy’s relationship. And, the overpayments to RS&M would never have been made without Kim Horton’s involvement in the invoice approval process.

Mecklenburg County hired Horton last June as its new revaluation manager. Potential red flags about her history in Alamance County, however, have apparently been flying under the radar for several months, according to an email that Bentley sent this week to County Manager Harry Jones, General Manager Bobbie Shields, and Commissioners Chairman Pat Cotham, and copied to board members:

Good morning, Bobbie and Harry.

I have been made aware this situation on several occasions, but have not pursued an inquiry about it to staff until now.  Please review the attachment and provide the rationale used in the hiring decision of Ms. Horton.  My intent is not to get into the minutia of County operations, however, given what we have just been through with the Assessor’s office I feel an obligation to follow up on this.  Please copy the entire Board on the communications related to this matter.

Thanks,

Karen

Jones was unavailable for comment and calls to Horton at the tax assessor’s office were not returned. From court records it appears the dispute between Alamance County and Horton, including counterclaims filed by Horton, was voluntary dismissed with prejudice in 2011.

But Horton’s history alone has raised concerns, as evidenced by Commissioner Bill James’ response to Bentley’s email:

Wow !

I agree with Karen that we need to determine the veracity of the allegations and (if true) determine why County management would have hired her. If it is false, we need to clearly indicate that the allegations were reviewed at the time of hiring and determined to be false.

“I understand that the board doesn’t do the hiring, but we (commissioners) have a duty to make sure that the county is being run well,” James said in an interview. “I don’t know how we do that if we’re kept left in the dark.”

“You’d think after all that’s happened with the revaluation, all the problems and controversy it’s created, Harry (Jones) would have given us (commissioners) some background about this,” James said of reports about Horton’s history. “But I swear I can’t remember anybody, any time, talking about any of that. Maybe it’s just me and I missed it. But I can’t believe all nine of us (commissioners) would’ve been so brain-dead that we either don’t remember hearing anything about it or having any concerns.”

This isn’t the first time commissioners have crossed paths with Jones over what many contend is the manager’s failure to adequately keep the board informed about county business and key decisions. (ring any bells?) The most recent example comes from the controversy swirling around how Jones and his executive management team handled a decision by the state to reassign the oversight of millions in Medicaid money from Mecklenburg County. Several commissioners say Jones and staff left the board in the dark about the switch.

“It’s become like walking through a minefield,” James said of the ongoing tumult between commissioners and the manager’s office. “You think one problem is resolved and you turn around you step right on another one.”

UPDATE: County officials responded to Commissioner Bentley’s concerns. The reply? Nothing to see here; move along. From General Manager Bobbie Shields’ email:

This is old news and was known and vetted by the County before Ms. Horton was hired.

Shields includes relevant emails from last year (below), when the question of Horton’s history apparently first popped on the radar, including discussions with General Manager John McGillicuddy and former Mecklenburg Tax Assessor Garrett Alexander (last seen resigning in the wake of the 2011 reval debacle Big Heist, only to keep a cushy job on the county’s payroll for $98,500).

From: Alexander, Garrett

Sent: Friday, August 10, 2012 8:52 AM

To: McGillicuddy, John

Cc: Saul, Cary

Subject: RE: Kimberly Horton, newly hired by the County

John,

Kim had the position of Tax Administrator in Alamance County. The County alleged accusations of overpayment of invoices, but contractually the County was committed to work beyond the initial scope and the accusations were later found to be false and the County dismissed both the suits against the revaluation company and Ms. Horton.

Documentation attesting to mutual settlement was reviewed in advance of the interviews of all the candidates. A panel interview was conducted by the real property division and Kim was recommended by the panel as being the most qualified and experienced candidate. The panel also reviewed the issues related to the previous employment and found them to be politically motivated and unsubstantiated by Alamance County, and that Alamance County sought the settlement of a counter suit by Ms. Horton.

The panel recommendations were discussed with Cary prior to getting his approval for the hiring.

Regards,

Garrett

The latest development, though, doesn’t appear to have eased Commissioner Bill James’ angst or concern; instead, it raised more questions. From the response he sent to Shields, after learning of the county’s vetting of Horton:

Bobbie -

That is interesting however I can’t find where the specifics of what the settlement was is outlined.

Did the appraisal company pay back the County? Did the County accept payment because they were reimbursed and just dropped the issue? Did the County make a payment to Ms. Horton because her allegations about the County were correct? Were there any referrals to the District Attorney or any agreement to not refer as a part of the final agreement?

The thing about this is that while the issue may be ‘old news’ it doesn’t seem to be complete news.

If the County assessed Ms. Horton’s role in this as being benign (meaning she wasn’t at fault and wasn’t a participant in any irregularities) then the County would need to have the actual information on the settlement. Saying it is ‘settled’ doesn’t really answer the particulars of the charges or whether the appraisal company reimbursed the County who then agreed to move on.

Did the County obtain this and review the documents associated with these allegations?

This looks like one to watch, folks. Updates to follow as they become available.

UPDATE II: The uptown paper’s editorial board follows up with some interesting revelations from an interview with Alamance County attorney Clyde Albright, who refutes Mecklenburg officials’ assertions that the issues involving Horton were “politically motivated” and “unsubstantiated.”

And get this – according to Albright, nobody from Mecklenburg County, throughout what officials claim was a thorough vetting of Horton, even bothered to contact the Alamance County attorney:

If someone had called, Albright could have said that although the lawsuit between RS&M, Alamance and Horton was settled, Alamance stands by its accusations against Horton. Albright said Wednesday that he showed Horton pay stubs for work she did for RS&M while employed full-time by Alamance County. RS&M’s owner confirmed the work in depositions. Neither told Alamance commissioners about that relationship when presenting RS&M’s bid.

That alone might’ve been enough to give Mecklenburg County officials pause, had they bothered to give Albright a call. But Albright also told the editorial board that the Alamance revaluation Horton oversaw was deeply flawed, with property owners appealing half of the 64,000 values. “We’re still working through them all,” he said of the appeals.

So, yeah, in the sage words of wisdom from Mecklenburg General Manager Bobbie Shields, “This is old news and was known and vetted by the county before Ms. Horton was hired.”

Nothing to see here, folks; just business as usual, with our elected officials again left clueless and in the dark.

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