Following an investigation initiated by Sacramento (Calif.) Public Library Director Ann Marie Gold, SPL filed suit October 30 against a local contractor, asking for more than $1.3 million in restitution and damages and accusing Hagginwood Services of an estimated $650,000 in repair and maintenance overbilling during the past four years. The alleged perpetrator is also under investigation by a Sacramento County grand jury, the Internal Revenue Service, and the FBI.
The suit names Hagginwood Services and two individuals, Janie M. Rankins-Mayle and James E. Mayle, seeking recovery from the defendants for performing contracting services without a contractor’s license, breach of contract, negligence, false claims, and fraud. Mayle was the library’s security supervisor prior to beginning a workers compensation leave in 2005. Rankins-Mayle, his wife, was registered as owner of a subcontractor called All City.
Released September 27, a report on the library’s investigation concluded that, among other things, the overriding effect of the establishment of the relationship with Hagginwood and All City was “to greatly increase the cost of routine maintenance.” The library official in charge of maintenance, Dennis Nilsson, was placed on administrative leave in June and resigned in September, the report says, noting that he “did not appropriately scrutinize the billings even after they had been questioned by accounts payable staff.”
Gold told American Libraries that the library never saw original invoices for subcontracted work at SPL facilities, since Hagginwood did all the billing. She noted that company officials said they shredded original invoices from subcontractors, but the few invoices recovered appear to show a clear pattern of inflating hours worked by the subcontractors, resulting in substantial overpayments by the library.
The Sacrament Bee reported November 1 that Gold had asked her staff “to notify top library officials immediately if grand jurors probing a billing scandal appear at any branch,” adding that librarians and legal experts questioned whether the request was fair or legal. Gold told AL that she had met with branch supervisors and encouraged them to speak freely, but “please let us know.” She said two or three had and that a “good free-flowing conversation” with the administration would “in no way interfere with the investigation.”
Sacramento Public Library officials, including the library’s governing board, have developed and are implementing a stringent set of safeguards to ensure such abuse of a public contract cannot occur at the library again, Gold said, and library officials are cooperating fully with law enforcement agencies. “The sad fact,” she noted, “is that fraud can happen, even in institutions like libraries. I am shocked and regretful that we made this kind of mistake with a contractor. But we’re putting measures in place to get restitution and get the taxpayers’ money back.”
Posted November 2, 2007.