Investigators allege that Arizona’s mine inspector broke the law by leasing vehicles without proper authority and spending taxpayer money on personal cell phones, political contributions and parking tickets.
State Comptroller D. Clark Partridge announced the conclusions Thursday following a five-month investigation. He said the department violated laws that regulate how state agencies purchase and account for vehicles, misused federal money and dipped into a fund to pay for personal expenses such as carwashes.
Specifically, the investigation found that Doug Martin, who is serving his last year in office, exceeded his authority by leasing four vehicles worth $103,834.
State law requires him to go through the Department of Administration to pay for the vehicles. Partridge said Martin thought he had the authority to pay for the vehicles because he was allowed to buy them in the past. Martin did not return repeated calls to his office.
The vehicles were bought in 2004 with federal money that was supposed to go toward training. Although the inspector’s office returned the vehicles to Ford Motor Credit in July, state officials said the state could be forced to reimburse the federal government because it didn’t use the money for training purposes.
In addition, the office didn’t report the purchase of the vehicles to the General Office of Accounting, as required by state law.
Kerry Ugalde, Martin’s chief assistant, characterized the 20-page report as mostly fair but criticized some parts as being too harsh. Because the office deals directly with the mining industry, Ugalde said it needs to be treated differently from other state agencies.
She also said the state’s procurement laws are confusing and Martin believed he was acting within the law. She also said there are times when regulations can end up costing taxpayers more money.
“Following the procurement policies is not always the most prudent action,” she said Thursday.
The investigation also found the office operated a $5,000 account with an outside bank in which employees used money for personal reasons. According to the report, employees paid for things such as a $12 parking ticket, a $50 donation to Sheriff Joe Arpaio’s posse members and a personal cell phone.
Martin also used the money to reimburse himself twice for the same $13.25 carwash, the report found.
William Bell, the director for the Department of Administration, will send the findings to the Arizona Attorney General’s Office for further review. But he will not make any recommendations on whether the state should prosecute Martin.
It was Bell who called for an audit of the mine inspector’s office in April after an employee there — on loan from another agency — reported financial mismanagement.