Tri-Cities port hires lawyer after WA state auditors claim $49,000 payment broke the law
After a reprimand from state auditors, Kennewick port leaders plan to hire their own attorney to decide if a former board member needs to repay $49,000.
Port of Kennewick commissioners voted this week to move forward with retaining a lawyer to review whether they violated their own policies in reimbursing the legal fees of former Commissioner Don Barnes, and whether he broke the law when he joined in the vote to reimburse himself.
The port recently received a “management letter” from the Washington State Auditor’s Office with the results of a recent audit. A management letter contains the official findings of an audit, and recommendations for responding to those findings.
The Jan. 19 letter said that when commissioners voted last April to reimburse Barnes for his private attorney fees, they may have violated their own rules.
And, auditors believe Barnes, who was president of the commission at the time, broke the law by voting on a matter which would personally benefit him.
The legal fees were related to a retaliation complaint and sanctions against Barnes and Commissioner Tom Moak.
The complaint alleged that Barnes and Moak retaliated against Port CEO Tim Arntzen after he refused to block the sale of land to the Yakima Farm Workers Clinic at Vista Field.
The two were later reprimanded and sanctioned. Moak accepted the punishment and apologized for yelling at Arntzen, but Barnes decided to fight to overturn the ruling.
To date the matter has cost the port close to half a million dollars in investigation and legal fees.
The port’s policies allow the port to spend money on the legal defense of commissioners for port-related matters, however Barnes chose to defend himself with his own attorney, which port’s policies say is not eligible for reimbursement.
Steve De Julio, an attorney for the port, later said that it was ultimately up to commissioners to decide if they should reimburse him.
Moak moved for a vote to reimburse in April 2021.
Skip Novakovich, who filed the initial retaliation complaint, abstained from voting, while Barnes seconded the motion and voted to reimburse himself.
Barnes did not run for a new term in 2021. He left office in December, but not before calling for Arntzen’s termination during the CEO’s annual review in November 2021.
Arntzen recently filed a tort claim against the port, demanding to have the unfavorable performance reviews removed from his record.
Kennewick Police Chief Ken Hohenberg, who is scheduled to retire from the city next month, was elected in November to Barnes’ former seat and was sworn in at the beginning of the year.
Legal review
Port of Kennewick CFO Nick Kooiker said last week’s auditor letter was a blemish on their otherwise spotless audit record.
“Everything else cleared the audit with flying colors. Our internal controls and procedures are strong,” he said. “However, as your CFO I can say I’m not surprised we received a management letter for the actions last spring. I did everything I could to defend the port, but there’s nothing I can do to defend an action they deemed illegal. I reiterate, I had concerns with the process. I didn’t think the process was legal.”
Novakovich, the board’s current president, said he was extremely disappointed, but also was not surprised by the letter.
“It appeared to me that the two commissioners were not concerned with ethics, perception, conflict of interest, or state laws,” Novakovich said, adding that had policies and procedures been followed he would not have objected to the reimbursement.
However, he said he was concerned the board was approving “redacted invoices that didn’t show what we were paying for.”
Hohenberg said while he was not a member of the board at the time, he believes the port should take the action suggested by state auditors.
Moak said that his vote to reimburse Barnes was based on legal advice from the port’s attorney that led him to believe the reimbursement was allowed.
Novakovich responded saying that De Julio had made it clear at the time that the port could still land in hot water over the decision.
Later in Tuesday’s meeting, Novakovich moved to approve annual committee assignments but gave none to Moak. Novakovich said he felt the decision was appropriate given the reprimand and sanctions Moak received in the past year.
Moak moved to challenge the decision, but failed when neither Novakovich or Hohenberg would second his motion.
After consulting with the port’s legal team in a closed-door executive session, the commissioners voted unanimously to approve hiring another attorney to review their options based on the audit findings.
The review could lay the groundwork to pursue legal action to recover the money.
Friend of the Port
In unrelated business, the board awarded former Kennewick Mayor Don Britain with it’s Friend of the Port award for 2021. He was honored his work fostering a partnership with the port that led to renovations of the port’s Oak Street Industrial Park buildings, creation and development of the Columbia Gardens Wine & Artisan Village, restoration of the Clover Island’s shoreline, and redevelopment of Vista Field.
