Top OP staff grilled by board

Trustees decide on 3rd party 'evaluation' of overpayment to software consultant

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First posted 1/13/2009 9:48 a.m.

While most Oak Parkers were asleep Monday night, the village board was figuring out next steps in an expanding dispute over whether top village staff acted improperly in making $200,000 in payments to a software consultant - payments allegedly not authorized by the board.

During a two-hour grilling Monday, trustees expressed frustration and anger at the actions of Village Manager Tom Barwin and Chief Financial Officer Craig Lesner in cutting a series of checks to a software consultant. Each check was just under the $25,000 mark at which Barwin needs board approval.

"I am deeply disturbed and share some of the outrage with people that I have heard from today," Trustee Ray Johnson said at the meeting. "Tonight, my concerns aren't alleviated, and frankly, I have more concerns."

Trustee Colette Lueck, who is up for reelection in April, was the first trustee to suggest an outside investigation into the matter. "I think that it's a very serious situation that we find ourselves in," she said.

The board entered executive session at 11 p.m. Monday. On Tuesday morning, Village President David Pope issued a statement on behalf of the village board saying "an outside evaluator" would be brought in "to look into these areas of concern." According to the release, the review will be overseen by an ad hoc board committee of trustees Johnson, Jon Hale, Greg Marsey and Jan Pate.

Mid-morning on Tuesday, the village also issued an announcement of a 7:30 a.m. committee of the board executive session on Thursday, Jan. 15, to discuss personnel.

When reached by phone Tuesday morning, Barwin said, "We obviously made a mistake in interpreting the policy and, in my end, in not catching it. And we feel awful about it. We've apologized to the board and the community about it, or would like to, but I can only say it was from a desire to try to really correct and improve some of our internal operations related to finance, accounting, bookkeeping and get this software to do what it's capable of doing.

"I'm completely convinced there were no ill-gotten gains here. Craig has worked his tail off since he's been here, and we erred in having tunnel vision in trying to fix a problem that had been lingering here now for over five years."

At the center of the concern is how to get hand-holding for a $1.6 million package of accounting and human resources software that the village bought in 2003, well before Barwin became village manager. The software is typically used by Fortune 500 companies and universities. Governments on the scale of New York City and large counties have this software, which has come to be known for the extensive outside support needed to use it.

At the time, PeopleSoft was being marketed to smaller communities, Barwin said.

The village board, back in mid-2007, green-lighted a contract of $75,000 to a company called JCG Corp. Lesner recommended the firm of Jennifer Grochowski, a PeopleSort consultant in Chicago.

Village officials, including Lesner, recommended paying Grochowski another $180,000 in 2008 to continue consulting on PeopleSoft. However, trustees sliced that item out of the budget, as part of more than $3 million in cuts going into 2008.

But the village ended up paying JCG Corp. another $204,000, at a cost of $125 per hour. Rather than going to the board for approval, village staff cut several checks to the consultant in small increments.

Barwin and Lesner said Monday they were doing what they believed the board wanted. Some trustees, though, questioned how staff allowed a contract to almost quadruple past its approved limit.

A review by the Journal of financial news reports shows that PeopleSoft consultants often charge as much as $190 an hour and work on multiyear contracts.

The board learned of the overpayments in August from an anonymous source, trustee Greg Marsey said in an interview Monday. Discussion on the matter was held off on until completion of the 2009 budget.

In an Aug. 15 confidential briefing to the board, obtained by Wednesday Journal, Barwin told the board that staff considered hiring Grochowski full-time, but that her consulting in Chicago on PeopleSoft was "too lucrative."

Barwin said that when he started work here in August 2006, he found "very serious issues" with Oak Park's accounting and finance processes. In some cases, he said, third parties were being paid twice; other times the village was not invoicing for work it had done.

PeopleSoft was only being used to a small fraction of its capacity, about 20 percent, and staff was having "considerable internal difficulty" operating the software, Barwin said. So the village set out to find a consultant to help get the expensive software running up to speed.

Lesner was hired as chief financial officer for Oak Park in March 2007 replacing Greg Peters, who retired the previous May.

Allegedly, Lesner had several conversations looking for a PeopleSoft consultant in the months following his hiring with no success. He got the lead for Grochowski through his wife's book club. The village did not seek a competitive bid for the work. Lesner said that he disclosed the consultant's relationship with his wife from the start.

In the August confidential briefing to the board, Barwin explained why the overpayments were allowed to continue on his watch.

"I think it is fair to say that I, the board, and Craig after his arrival, were simply just gut sick about the prospect of watching a $1.6 million purchase just five or so years ago, to be declared nearly a total waste and failure, and watch the effort flow down the drain," Barwin said in the memo.

The board approved the first $75,000 contract in August 2007. That was for a "gap analysis" to find holes in how the software was being used. Lesner said Grachowski succeeded in making that assessment, but further consulting was needed.

"Jennifer, when she came here, really closed these gaps," Lesner said. "Everyone on my staff will testify that her value was immense."

In an interview Monday, Marsey questioned Barwin's response to the situation.

"My problem with that at the time, and what has continued to bother me is that there was no recognition of what was done was wrong and borderline illegal, and some procurement needed to be put in place," he said. "I'm glad that this story is finally seeing the light of day so we can put the process in place so it doesn't happen again."

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