Mayor Chris Beutler today announced that the Lincoln Police Department found no criminal wrongdoing in the actions of a golf program employee regarding soft drink contracts.
Golf Manager Dale Hardy signed contracts between the City’s Ager Junior Golf Course and Pepsi without the proper authorization.
The contracts – which diverted a portion of the proceeds from sales into Hardy’s retirement account – were discovered by the city Purchasing Division, and the mayor announced the investigation and audit July 18.
A separate examination of the golf program by a local CPA firm also found no further financial impropriety beyond the inappropriately signed contracts, according to a city press release.
Hardy was an independent contractor for the city until 2001 when he became a City employee. The practice of pocketing a portion of pop sales in his PGA of America retirement fund was acceptable when Hardy was an independent contractor, but not as a city employee because city employees cannot personally benefit from the terms of a city contract. About $800 was deposited into Hardy’s retirement account.
While an independent contractor, Hardy had the authority to enter into contracts with vendors. The city contract approval process requires authorization by a department head or the mayor.
The police investigation found no intent to unlawfully receive funds.
“Despite the lack of criminal charges, this situation represents a serious violation of city policy and warrants appropriate consequences,” said Parks and Recreation Director Lynn Johnson.
Hardy received a suspension with no pay, will pay restitution for the retirement funds designated for him and is required to take training in the city procurement process. He has returned to work. The restitution will be paid into the Jim Ager Golf Marathon Fund in the Parks and Recreation Foundation.
Johnson said Hardy’s supervisor approved signing the contracts and the private retirement fund arrangement. Personnel action was not taken with Hardy’s supervisor because he recently retired.
“I apologize for my part in the situation,” Hardy said in a press release. “I’m glad to put the matter to rest and get back to work supporting the city’s excellent public golf program.”
Johnson said the soda vendor, Lincoln Pepsi, cooperated in the investigation and “did nothing wrong in offering the contracts.