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Audit: Austin music official failed to report employee’s bogus invoice


Highlights

Auditor: City’s top music man, Don Pitts, failed to report employee’s filing of fake invoice.

Controversy stems from effort by city employee to recoup travel costs for ‘no-cost’ trip.

Pitts says city auditor failed to consider he discovered the problem and ensured repayment of the money.

Auditor filed complaint over actions of Pitts’ employee to Ethics Commission.

Austin City Hall’s top music official, Don Pitts, failed to report a subordinate who billed the city $2,500 for work her boyfriend apparently never performed as part of a scheme to be reimbursed for unauthorized travel expenses, an investigation by the city auditor found.

Additionally, the auditor’s office filed an ethics complaint against the now-former city employee Pitts failed to discipline, charging she misused her position and filed a fraudulent report in an attempt to recoup the costs of a 2014 work trip to Europe to promote Austin’s music scene.

“We found evidence indicating that Don Pitts was aware that his direct report appeared to have planned and committed fraud and Pitts did not report this employee to the appropriate authority,” the auditor’s office wrote in the summary of its report, released Friday.

The money was repaid in June 2015 and the employee later resigned, the report states. The initial complaint to the auditor’s office was filed in January 2016.

“What the situation boils down to really is that I didn’t follow stated City protocol,” said Pitts in a statement. “I fixed what I thought was a mistake and insubordination, but I didn’t report it correctly. I have nothing to hide.”

In a separate statement, Pitts attacked the auditor’s report, writing that the report “goes out of its way to bury key facts I pointed out in my response; that I specifically ordered the (employee) not to do it, that I ordered the review that discovered it and that I demanded she fix it.”

The auditor’s report focuses on Pitts’ handling of the incident as a supervisor, not the conduct of the former employee now facing the ethics complaint.

Pitts stepped down Tuesday from his position running the city’s Music and Entertainment Office, though the city announced Thursday he would stay on through April 29 to help with South by Southwest events and other duties. He had been on leave since January while the auditor investigated.

A ‘zero cost’ trip

The report, released Friday, found emails that suggest Pitts knew the employee, Ashley Buchanan, sought to recoup the $3,500 she spent on the trip after being denied reimbursement through formal channels. Buchanan couldn’t be reached Friday for comment.

The trip was originally reported and approved as being at “zero cost to the City.” According to the auditor’s report, Buchanan said Pitts instructed her to file the trip as a no-cost sojourn to ensure the travel was approved in time for the trip and assured her the costs would be covered.

However, upon return, she was unable to claim the expenses because the trip had been filed as “no-cost.” Buchanan later suggested two alternative methods of reimbursement, the auditor found.

First, the report said, she suggested filing a fictitious $3,000 advertising invoice, which would “sneak through without getting noticed because it is ‘advertising’” and doesn’t need a purchase order number. According to emails included in the report, Pitts replied: “Let’s discuss. I will work with you on this but this can never happen again.”

Pitts told investigators he discouraged Buchanan from proceeding with this plan.

Second, Buchanan suggested — and said Pitts approved — creating a fictitious $2,500 invoice for work performed by her boyfriend for a program under Pitts’ purview, the audit said. Pitts denied ever telling Buchanan to submit the invoice.

Pitts emailed Buchanan to let her know management didn’t want to hire her boyfriend as a sound engineer. However, Buchanan didn’t retract the purchase authorization request, which was approved in late May 2015.

Leaving the bureaucracy

In his written response to the audit, Pitts said he ordered the review that uncovered the $2,500 purchase order, verbally reprimanded Buchanan, changed the process to ensure it couldn’t happen again and made sure all the money was returned.

In the resignation letter he submitted Tuesday, Pitts described himself as a poor fit for the city’s bureaucracy: “As a music industry person, I realize I work differently,” he wrote. “I understand why protocol is important in the life of a city bureaucracy, and I realize it is time for me to not work within a bureaucracy any longer.”

Pitts had held the job since 2010, making $97,000 a year.

Over his seven years at the helm of the city’s music office, Pitts pushed for the creation of one-stop permitting for venues and an “agent of change” rule, which if enacted, would better shield longtime venues from noise complaints filed by new developments.

He played a key role in commissioning a first-of-its-kind census of the Austin music industry in 2015, which found rising costs were squeezing venues and artists, and helped develop a pilot program to extend curfews for venues along Red River Street, which the City Council approved in January while he was on leave.



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