Audits fault groups run by Richmond officials

Audits released this week for the cities of Austin, Texas, and Denver have stung two senior members of Richmond Mayor Dwight C. Jones' administration.

The Denver audit is particularly critical of work by Seedco Financial Services, which was led by Peter H. Chapman before he was hired this summer as Richmond's deputy chief administrative officer for economic and community development.

The Austin audit concerns that city's work with the Austin Revitalization Authority, which Byron C. Marshall led before he was chosen by Jones as Richmond's chief administrative officer.

The Jones administration had no comment.

City Councilman Bruce W. Tyler expressed concern about the audit that blasts Seedco for failing to meet contract requirements and likening it to a startup company. Chapman was executive director and vice president of Colorado operations for Seedco.

"I've had very good responses, dialogue with Peter, then I see something like this," Tyler said. "It's like a completely different person. It makes me wonder [about] other factors that we don't know about."

Denver's office of economic development hired Seedco in 2007 to provide funding and technical assistance to small businesses, nonprofits and large commercial projects in low-income areas.

However, Denver City Auditor Dennis J. Gallagher said the company has failed to meet job-creation goals and to comply with its contract. He also concluded that Seedco might have made at least one loan that violated federal requirements. He said the poor performance is hurting other city efforts to lend money.

The Austin audit assesses the city's efforts with the Austin Revitalization Authority to redevelop the corridors of East 11th and 12th streets. Marshall was president and CEO of the nonprofit community-development corporation.

The audit found that the initiative has reduced blight but has been implemented slower than envisioned. Auditors attributed the delays in part to actions by the city and the authority. The authority also was criticized for being too reliant on the city for income, as well as for poor financial planning.

The authority's "financial condition and need to pursue viable projects, combined with delays and market conditions, have resulted in community dissatisfaction with some proposed development and with slow progress in the redevelopment area," the audit said.

Tyler said he's not alarmed if the message is that Austin's revitalization efforts are dragging.

"Heck, look around," he said. "Look at our housing authority, in terms of getting something done. [In Austin], they at least have something going on."

This week's release of the two audits appears to be coincidental.

A spokesman for the Denver auditor said his report was scheduled to be issued later this month but was accelerated at the request of members of the City Council, which is getting ready to vote on whether to renew Seedco's contract. The Austin audit initially was expected late this summer.

Contact Will Jones at (804) 649-6911 or .