OMAHA, Neb. (AP) – Less than a year into its existence, a state commission charged with helping problem gamblers has been castigated by the state auditor’s office for the awarding of two contracts that appear to violate the state’s conflict-of-interest laws.
State Auditor Mike Foley issued a report late Monday on the Nebraska Commission on Problem Gambling, formed in July 2013 to take over the state’s Gamblers Assistance Program. That program had previously been run by the Nebraska Department of Health and Human Services.
The new commission almost immediately named Jerry Bauerkemper as its interim director. Bauerkemper, the director of the not-for-profit Nebraska Council on Compulsive Gambling, took a nine-month leave of absence as that group’s director, but remained employed by it – even as the public commission awarded two contracts valued at more than $200,000 to that organization without bidding out the work, Foley’s report said. Instead, the commission issued the contracts to manage a problem gambler’s hotline and to provide training services “on an emergency basis.”
Bauerkemper’s organization had unsuccessfully sued the state in 2011 after it was denied contracts to help problem gamblers. When the lawsuit failed, Foley said Wednesday, the group went to the Nebraska Legislature to have a bill introduced to take the program away from HHS and give it to an independent commission, whose members are appointed by the governor.
“Then they were able to get their own guy installed as the interim director of the new commission,” Foley said. “And then one of the first things he did was to write the contracts for his own group, then went back to work for them. So the whole thing is very peculiar and, we think, inappropriate.”
The report also questions whether the contracted work paid for with public money was even fully provided by Bauerkemper’s organization, noting a lack of documentation to prove that the services were fully provided.
Bauerkemper did not return messages left Wednesday at his office and on his cellphone.
Omaha state Sen. Bob Krist, who introduced the bill to form the new public commission, said that move was the right one and is saving state taxpayers money.
“It’s taken a function (of training) that had been costing taxpayers about $100,000 and reduced it to about $5,000,” Krist said.
Krist also said Bauerkemper’s leave of absence from the not-for-profit was, legally, tantamount to quitting the organization, then later being rehired. And Bauerkemper did not hire his organization on his own, Krist said.
“That contract was awarded at the approval of the commission,” Krist said. “If there was a hint of malfeasance, I’d be the first to admit it.”
Foley has referred his report to the Nebraska Attorney General’s Office and the Nebraska Accountability and Disclosure Commission for further review.
Copyright 2014 The Associated Press.
