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Unified Fire Authority punts on decision of whether to sue to seek recovery of hundreds of thousands of dollars in allegedly misused public funds

(Francisco Kjolseth | The Salt Lake Tribune) New Fire Chief Dan Petersen for Unified Fire Authority discusses changes he has made to correct past problems during an interview on Thursday, Sept. 13, 2018. A 196-page investigative report by the Utah Attorney General's Office illuminated a pattern of past administrative abuse of public positions for personal benefit and yearly bonuses in the tens of thousands of dollars. The UFA board will likely consider whether to take its own legal action against the former fire administrators at its meeting next week.

  | Sep. 18, 2018, 6:38 p.m.
| Updated: Sep. 19, 2018, 2:02 p.m.

The boards of the Unified Fire Authority (UFA) and the Unified Fire Service Area (UFSA) punted on the decision of whether to attempt recovering hundreds of thousands of dollars in public funds that state auditors last year concluded were misused by UFA’s top administrators.

A civil lawsuit would likely be the only way to go after that money because a more-than-yearlong investigation by the Utah Attorney General’s Office, released last week, ended with no criminal charges.

“I think it’s appropriate to say that our board is disappointed that they didn’t feel like it reached that bar” for criminal prosecution, UFA Chairman Robert Dahle said at the boards’ joint meeting on Tuesday.

The comments of Dahle, who is also mayor of Holladay, came after board members met in a 45-minute closed session with legal counsel to review the investigative report and to determine their next course of action.

But because of the volume of information included in the report, Dahle said the boards need more time to make a decision. They’ve directed their legal team and staff to review all the available information about the case to decide how to proceed civilly, with a decision expected at their October meeting.

The Unified Fire Authority operates fire and emergency services throughout most of Salt Lake County under contract with individual cities. The Unified Fire Service Area is a separate but related taxing district made up of municipalities that levy property taxes to build fire stations operated by UFA.

The money the boards would seek to recover includes at least $370,000 in public funds that the audit concluded chief Michael Jensen and ex-Deputy Chief Gaylord Scott had improperly received.

The payouts included sizable severance checks to the two — $93,000 to Jensen and $42,000 to Scott — even though they resigned abruptly in 2016 under a cloud of suspicion. Additionally, Jensen and Scott, along with Chief Financial Officer Shirley Perkins and Chief Legal Officer Karl Hendrickson, received more than a combined $400,000 in bonuses, or “incentive pay,” between 2011 and 2015.

(Christopher Cherrington | The Salt Lake Tribune)

The state audit and the 196-page investigative report from the Attorney General’s Office found the agency’s top administrators had received exorbitant bonuses, been reimbursed for personal vacations attached to official travel, purchased electronic equipment for personal use and hired close family members outside UFA rules.

The UFA board has worked through about 100 of the 126 recommendations included in the state auditor’s report.

Among the changes since the audit brought a number of leadership and cultural issues to light, Chief Dan Peterson, who took over in January 2017, says he and the board have been making changes to remedy that culture, such as eliminating the agency’s bonus program altogether.

And now that state investigators have verified “troubling” behavior first identified by auditors and painted a sharper picture of the culture that allowed those abuses of power to thrive, UFA can proceed with implementing the rest of those recommendations, Dahle said.