Tuesday, December 02, 2008
Manager at Roanoke transit company suspended during investigation
Updated 5:25 p.m.
A manager at Greater Roanoke Transit Company has been suspended after coming under investigation for possible bid rigging.
William "Chip" Holdren was suspended from First Transit, an Ohio company that manages the bus system for the city of Roanoke, said Nicole Jones, a spokeswoman for the company.
The suspension will remain in effect until the investigation is completed, Jones said.
Meanwhile, Diane Holdren released the following statement through her attorney, Matthew Broughton of Roanoke:
"Due to the fact that this is an ongoing investigation, my attorneys have instructed me not to comment at this time," the statement read.
"I have cooperated with the investigation. Once the investigation is complete, I am confident there will be logical answers to any questions that might remain."
Updated 3:55 p.m.
Police are investigating a possible case of bid-rigging at the Greater Roanoke Transit Company, where a manager is suspected of steering funds for an office renovation project to his wife’s furniture business.
According to a search warrant filed today in Roanoke County Circuit Court, fabricated bids were used to obtain a contract for furniture and art work for the city’s bus maintenance garage at 1108 Campbell Ave.
The investigation centers around William "Chip" Holdren, assistant general manager at GRTC, and his wife, Diane Holdren, the owner of Holdren’s Interiors, according to the warrant and a memo sent to city council members today.
Neither of the Holdrens has been charged criminally.
Diane Holdren was the dealer for the furniture manufacturer used for the renovation, which cost $223,301, Municipal Auditor Drew Harmon wrote in the memo.
Authorities believe the Holdrens "have prepared fake bid proposals and had these fraudulent proposals delivered to the City of Roanoke in order to win bids" for the project, the search warrant stated.
The warrant authorized police to seize computers, telephones and paper records from the Holdrens’ home in Roanoke County. Another search is underway today at the maintenance garage, which also houses the administrative offices for the city’s bus system, Valley Metro.
A call to the Holdren home was not immediately returned today. Valley Metro officials also were unavailable.
Councilman Sherman Lea, who chairs the city’s audit committee, said suspicious activities at Valley Metro were discovered during routine audits by city officials.
"It’s another mess. It’s another black eye for the city," Lea said, citing similar cases in recent years, including a conflict-of-interest scandal at the Roanoke Redevelopment and Housing Authority and the ongoing investigation of Alfred Dowe, who resigned from city council earlier this year amid questions about his spending on meals and travel.
"There seems to be a prevailing attitude that people can make money improperly, if not illegally, and get away with it," Lea said.
"These are people who are in a position of trust, and it’s frustrating and it’s something that we as a city council need to think about," he said. "We need to send a message that this kind of activity is not going to be tolerated in Roanoke."
"With the cloud of distrust and deception that’s hanging over this city, everything ought to be audited."
According to the search warrant, Harmon and his staff first became suspicious about the bidding process at Valley Metro because it appeared that one person — Diane Holdren — was winning most of the bids.
An investigation by city auditors found that bids were fabricated from at least four other furniture companies to make it appear there was competition for the renovation project, when in fact the only real bid was from Holdren.
Lea said the contract for $223,301 was about $50,000 more than the fair market value.
"That’s big money," Lea said. "That’s not chicken scratch."
Valley Metro staffers are not city employees; they work for First Transit, a Cincinnati company that operates the city bus system. But the city maintains some oversight of the system, with council members acting as its board.
About 80 percent of the money used to buy the furniture came from federal transportation funds, Harmon wrote in his memo. Federal regulations require competitive bidding for purchases over $100,000, while also forbidding GRTC from doing business with related parties, such as spouses.
A manager at Greater Roanoke Transit Company has been suspended after coming under investigation for possible bid rigging.
William "Chip" Holdren was suspended from First Transit, an Ohio company that manages the bus system for the city of Roanoke, said Nicole Jones, a spokeswoman for the company.
The suspension will remain in effect until the investigation is completed, Jones said.
Meanwhile, Diane Holdren released the following statement through her attorney, Matthew Broughton of Roanoke:
"Due to the fact that this is an ongoing investigation, my attorneys have instructed me not to comment at this time," the statement read.
"I have cooperated with the investigation. Once the investigation is complete, I am confident there will be logical answers to any questions that might remain."
Updated 3:55 p.m.
Police are investigating a possible case of bid-rigging at the Greater Roanoke Transit Company, where a manager is suspected of steering funds for an office renovation project to his wife’s furniture business.
According to a search warrant filed today in Roanoke County Circuit Court, fabricated bids were used to obtain a contract for furniture and art work for the city’s bus maintenance garage at 1108 Campbell Ave.
The investigation centers around William "Chip" Holdren, assistant general manager at GRTC, and his wife, Diane Holdren, the owner of Holdren’s Interiors, according to the warrant and a memo sent to city council members today.
Neither of the Holdrens has been charged criminally.
Diane Holdren was the dealer for the furniture manufacturer used for the renovation, which cost $223,301, Municipal Auditor Drew Harmon wrote in the memo.
Authorities believe the Holdrens "have prepared fake bid proposals and had these fraudulent proposals delivered to the City of Roanoke in order to win bids" for the project, the search warrant stated.
The warrant authorized police to seize computers, telephones and paper records from the Holdrens’ home in Roanoke County. Another search is underway today at the maintenance garage, which also houses the administrative offices for the city’s bus system, Valley Metro.
A call to the Holdren home was not immediately returned today. Valley Metro officials also were unavailable.
Councilman Sherman Lea, who chairs the city’s audit committee, said suspicious activities at Valley Metro were discovered during routine audits by city officials.
"It’s another mess. It’s another black eye for the city," Lea said, citing similar cases in recent years, including a conflict-of-interest scandal at the Roanoke Redevelopment and Housing Authority and the ongoing investigation of Alfred Dowe, who resigned from city council earlier this year amid questions about his spending on meals and travel.
"There seems to be a prevailing attitude that people can make money improperly, if not illegally, and get away with it," Lea said.
"These are people who are in a position of trust, and it’s frustrating and it’s something that we as a city council need to think about," he said. "We need to send a message that this kind of activity is not going to be tolerated in Roanoke."
"With the cloud of distrust and deception that’s hanging over this city, everything ought to be audited."
According to the search warrant, Harmon and his staff first became suspicious about the bidding process at Valley Metro because it appeared that one person — Diane Holdren — was winning most of the bids.
An investigation by city auditors found that bids were fabricated from at least four other furniture companies to make it appear there was competition for the renovation project, when in fact the only real bid was from Holdren.
Lea said the contract for $223,301 was about $50,000 more than the fair market value.
"That’s big money," Lea said. "That’s not chicken scratch."
Valley Metro staffers are not city employees; they work for First Transit, a Cincinnati company that operates the city bus system. But the city maintains some oversight of the system, with council members acting as its board.
About 80 percent of the money used to buy the furniture came from federal transportation funds, Harmon wrote in his memo. Federal regulations require competitive bidding for purchases over $100,000, while also forbidding GRTC from doing business with related parties, such as spouses.
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