The city of Dallas employee who allegedly steered nearly $1 million in HUD money to a Fort Worth pastor continues to draw his paid leave salary, records show, even as the feds have demanded the city repay the money.
Records obtained by The Texas Monitor show that Carl Wagner, a housing department employee, received his most recent $2,977 payroll check on May 11. Wagner has received his salary via direct deposit every two weeks, minus contributions for pension, medical benefits and taxes since being placed on administrative leave in March.
The Inspector General’s office of the U.S. Department of Housing and Urban Development on May 8 released an audit claiming that the city had failed to vet Dry Quick Restoration, a Fort Worth-based contractor run by Kenneth W. Williams, a preacher and former business partner of Wagner.
Wagner was placed on paid leave in March after the city discovered Wagner allegedly gave the contracts to Williams and Quick Dry.
Wagner and Williams were childhood friends who had joined in business ventures since the 90s, according to reports.
According to a newspaper report in March, the two worked together at the city of Fort Worth, where Wagner was an employee before coming to Dallas. As in Dallas, Wagner gave Williams hundreds of thousands of dollars in contracts.
“They had previously worked together in Fort Worth. When Wagner was a city employee there, records show, Williams got hundreds of thousands of dollars in city business,” according to the story. “But a legal dispute ensued, and Williams agreed to never again seek federal funds through Fort Worth’s housing department.”
Keeping Wagner on the payroll even as the HUD probe found evidence of improper contracting “is extremely troubling,” council member Scott Griggs said. “Because of his actions, the city of Dallas is on the hook for excess of $1 million and a damning public report from the investigator general of HUD, implicating this individual. The OIG report is a roadmap for termination.”
City manager, T.C. Broadnax, did not respond to an email and his chief of staff, Kimberly Tolbert, did not return a call.
Wagner’s Facebook page links to a company he calls Wagner Consulting Group, where he claims to be a former owner and a “certified lead supervisor and lead project designer” with the state.
State records show a Carl E. Wagner of Fort Worth was formerly certified but his license lapsed in 2009.
Wagner did not respond to a message or call seeking comment.
A large part of the HUD inspector general’s investigation deals with the city’s troubled contract with Dry Quick. Before enlisting the services of Dry Quick, there were indications that it had “limited financial capacity,” the audit states.
Dry Quick failed in numerous capacities, blowing deadlines and delivering shoddy work, the audit alleges.
“Dry Quick exceeded the contract completion date on all of its reconstruction projects by 9 to 18 months,” according to the report.
“…Further, the City did not take appropriate action to mitigate capacity issues or enforce contract terms. In addition to poor contract administration, the delays caused a hardship for the homeowners that the program was designed to help.”
The report included five pages assessing the shortcomings of the city’s deal with Dry Quick, which it says failed to provide warranties for its work, withdrew over the allotted amount of money for materials and left debris in yards where it worked.
“…The City tried to avoid its responsibility by including clauses in its contracts stating that it was not responsible for the contractor’s failure to carry out work in accordance with requirements…as a result, the City paid Dry Quick almost $700,000 for seven reconstruction projects that were completed late and not in accordance with contract terms.”
Williams did not respond to a message seeking comment.
Housing director David Noguera, did not respond to an email. Noguera, a former analyst in the U.S. Government Accountability Office, was hired in June 2017, and was not on board when the agreements in question were signed.
Records show that last payment to Dry Quick was for $18,952 in September 2017. The city contends it does not need to repay the $1.3 million that HUD says was misspent.
Despite the fact that “mistakes were made, construction was delayed and documentation was deficient,” the money was spent appropriately, the city said in its written response to the edit. Instead of repaying the money, “the city will allocate non-federal funds to address needed repairs to the homes…”
Steve Miller can be reached at [email protected].