Story behind the story: Tiffany Couch’s resignation

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I had a weird day Wednesday.

It started with a note alerting me that forensic accountant Tiffany Couch had resigned from the Clark County Audit Oversight Committee. You can read my story here.

My day ended with a call from Councilor David Madore.

I’ve rarely spoken to Madore, and almost always in the context of him telling me he’s not going to talk to me. Madore proceeded to tell me he would be emailing me some thoughts on Couch. About an hour and a half later, he sent me a statement.

Madore then called to follow up, and that’s where the day got really weird. Madore asked if I would post his entire email along with the story. I told him I couldn’t promise that. I added the relevant part of his comments to my story, turned it in, and left the office.

About two hours later, I saw that Madore had posted his full comments—which are, of course, public record because he sent them to me via his county email—on his campaign website, saying he agreed to comment to The Columbian under the condition that we post the entire statement, and that we had “betrayed that trust.”

For the record, journalists don’t make these kinds of promises, and we certainly don’t agree to terms and conditions upon which statements—and especially not those made using public resources—are used. Not to political candidates, sitting politicians or to anyone. Part of my job is to synthesize pieces of information into a coherent story. That’s Journalism 101.

Meanwhile, after the story was posted online, Auditor Greg Kimsey (no friend of Madore’s, though both are Republicans) sent an e-mail asking for three minor changes to clarify some of the facts in the story. We made those changes.

That said, I’m all for a little more transparency. Here, therefore, is Madore’s email to me, Couch’s resignation letter, her email to Kimsey regarding her concerns with the county’s audit of the fee waiver program, and Kimsey’s email to me about the errors in the story.

Couch’s resignation letter

Couch’s concerns with the audit

From: Tiffany Couch [mailto:TCouch@acuityforensics.com]
Sent: Thursday, November 13, 2014 4:34 PM
To: Kimsey, Greg; Grady, Matthew
Subject: RE: Report #14-02 DRAFT Comments/Observations

Sounds great. Just an FYI – my schedule gets kind of difficult next week, so we should get something on the books ASAP. I have time tomorrow or Monday.

Tiffany R. Couch, CPA/CFF, CFE

Principal

P:  360.573.5158
M: 360.601.4151
E: tcouch@acuityforensics.com
www.acuityforensics.com

‘Whenever you see a successful business, someone once made a courageous decision.” – Peter Drucker

From: Kimsey, Greg [mailto:Greg.Kimsey@clark.wa.gov]

Sent: Thursday, November 13, 2014 4:14 PM
To: Tiffany Couch; Grady, Matthew
Subject: RE: Report #14-02 DRAFT Comments/Observations

Tiffany, thanks very much for your thoughtful comments.  Matt will be inviting you to meet with the primary author of the report, Larry Stafford, to discuss them.

Regards,

Greg

P.S.  I’m sorry I was a “no-show” at the commissioners’ meeting yesterday.

From: Tiffany Couch [mailto:TCouch@acuityforensics.com]
Sent: Thursday, November 13, 2014 11:50 AM
To: Grady, Matthew; Kimsey, Greg
Subject: Report #14-02 DRAFT Comments/Observations

Greg and Matthew –

Now that I’ve documented my questions/observations, I want to preface it with this: I like your writing style and the easy to read nature of the report. I hope you will understand that the nature of my comments are sincerely meant to protect you and your team from what will be a critical look at this report and my only intention is for my comments to be taken in the spirit of collaboration with you (and not against you!).

My biggest concern is the lack of sufficient, relevant evidence supporting the conclusions. I’m a big data person and I’m not seeing a lot of data in the report. However, that being said, in my estimation you will likely come up with a similar conclusion, albeit one that might “split the baby” so to speak….based on what you already have here, the data may show that in some cases the fee waivers actually make sense, while in others it really does not…and thus, it might make sense to retract it back similar to previous iterations of the program rather than getting rid of it all together.  Perhaps not? But allow the data to make the determination.

I’ve taken a look at the report and the Resolution in question. Here are my questions/observations (in no particular order of importance!):

1.     There are a lot of references to “National Research Studies” – specifically:
a.     What studies do you refer to?
b.     What are their dates?
c.     What data do they provide?
d.     What Portland/Vancouver studies did you rely on, if any?

2.     The resolution speaks to more than just jobs, specifically:
a.     Rates of development
b.     Sales and Real Estate Taxes and other forms of revenue
i.    How did you measure the data on these factors of the resolution?

3.     Under Section 5, the Resolution indicates that Public Works staff shall calculate the TIF waived and monitor & track these projects
a.     Are they doing that?
b.     If not, what recommendations do you have to ensure that this data can be collected?
c.     If yes, where is that data in the report, your review of their reports to the BOCC, etc.?

4.     Page 5 of your report:
a.     You mention a 2011 survey
b.     Did you conduct a confirmation process or some other survey to get more up to date data?
c.     I’m concerned about the length of time and # and amount of projects that have occurred since the original survey.

5.     Page 6 of your report:
a.     I’m concerned that the data you provide in Figure 2 might be misleading due to the lack of information you identify on Page 6. If the data you need is not available and it showed a different outcome, would it/could it change your audit outcome?
b.     If yes, then consider omitting the Figure and/or stating that more prominently in your conclusions throughout the report.

6.     Page 7 of your report:
a.     I’m losing you here or perhaps am not understanding:
i.    Am I correct in reading Figures 3 and 4 as follows:  6% of fee waivers were for health care, but the job growth in Clark county is 11% – is that how these correlate? And if so, for those other industries and manufacturing, would it be correct to assume the fee waivers are working for those types of industries (i.e. there are small amounts of fee waivers for a net positive growth in jobs)? If yes, then perhaps your recommendation could point to this fact and this data as basis to amend the program.

7.     Page 8 of your report:
a.     How did you come up with your range of percentages?

8.     Page 8 of your report:
a.     You indicate that most commuter jobs are related to construction, manufacturing and wholesale trade.
b.     However, 26 percent of the fee waivers provided are related to Wholesale Trade (12%), Manufacturing (7%) and Other (7%). Perhaps this supports #6 of my recommendations above that this data specifically speaks to why/how the fee program can be changed?

9.     Page 9 of your report:
a.     You make references only to the 2nd quarter of 2014 of fees not sufficient to cover operations.
i.    What about between 2010 and 2014 as a whole?
1.     I’m a fan of data, so I’d be interesting in seeing over time what’s been going on.
ii.    Did anything else happen in 2nd quarter 2014 that could contribute to this?
1.     Your chart on page 5 shows a steep decline in construction overall – could this be contributing to the deficit?
2.     Anything else?

10.   Assuming the fees waived had been realized, what % would have gone to the general fund, what % to reserves, etc.?

11.   Throughout the report there is reference to “delayed” or potentially unfunded future projects.
a.     Be specific on what projects you are concerned about.  In my audit experience, local governments have long range planning for such projects and so expected revenues vs. realized revenues could potentially be matched against projects on that long range plan.

12.   Page 10 of your report: you talk about best practices.
a.     What specific best practices do you refer to?
b.     I might list those out and reference the source in the body of the report to support the conclusion in the back.

13.   Data Collection Recommendations
a.     Consider being more specific in how the County can better collect data pertinent to this program, specifically what’s called for in the Resolution

As you can see in my comments, I’m a big data person. What do the numbers tell us? It is likely that you will have similar conclusions, albeit that perhaps it makes sense for a partial retraction of the current system and not a full one….or perhaps it will stay the same as it is now. Nevertheless, just make sure you’ve got enough data and supporting documentation to support this.

Good first draft. Don’t be afraid to put a little more teeth in it to support your conclusions.

PS – Just curious, did the BOCC give a reason why they didn’t respond? Not understanding why they wouldn’t…or why they wouldn’t at least give a reason. Assuming they did, perhaps that could be included in the report.

Best regards,

Tiffany

Tiffany R. Couch, CPA/CFF, CFE
Principal
P:  360.573.5158
M: 360.601.4151
E: tcouch@acuityforensics.com
www.acuityforensics.com

‘Whenever you see a successful business, someone once made a courageous decision.” – Peter Drucker

Madore’s response to The Columbian

“Madore, David” <David.Madore@clark.wa.gov> 7/8/2015 6:17 PM >>>

On November 12, 2014, Tiffany Couch, founder of Acuity Forensics, accepted the appointment to the Audit Oversight Committee (the AOC), a public agency subject to the Open Public Meetings Act and the Public Records Act. Members of the AOC have the following responsibilities as defined in ccc 2.14.070(3):

(b) Review and analyze all audit reports.

(c) Ensure that management has initiated appropriate action to resolve exceptions or weaknesses noted in audit reports.

(d) Apprise the board of county commissioners of activities and result of audits.

Section (1) specifies the purpose of that committee as follows:

“The audit oversight committee’s function is to assist the county auditor and the board of county commissioners in fulfilling their fiduciary responsibilities, and to facilitate a direct line of communication between auditor and the board. The objective of the committee is to promote the effectiveness and integrity of audit processes.”

http://www.codepublishing.com/wa/ClarkCounty/clarkco02/clarkco0214/clarkco0214070.html#2.14.070

The three member AOC was made up of County Auditor Greg Kimsey, County Commissioner Chair Tom Mielke, and Tiffany Couch. Couch’s first task as a new AOC member was to consider Report #14-02, Greg Kimsey’s document titled “Audit of Clark County’s Job Creation – Fee Waiver Program”.

At the November 25 meeting, the Auditor’s staff presented the report to the County Commissioners with all three members present.

Although Kimsey was given the written Commissioner Response ahead of the meeting and was asked that the Response be presented onscreen along with the Auditor’s report, he announced during the meeting that the Commissioners did not have a response. Before the meeting ended, Madore reminded the staff that there was, in fact, a Commissioner Response. But Kimsey concluded the meeting and left the room before that Response could be presented.

Couch participated but did not provide any feedback to the Commissioners following the meeting. County Commissioner David Madore called Couch at a subsequent date for her feedback. She indicated that she did not support the Auditor’s document, but would not make any public statements regarding that report. Citizens naturally presumed that the Auditors report was credible and authoritative due to Couch’s respected position as a well-known Forensic Accountant.

County Commissioners published Kimsey’s document along with his Power Point Presentation and the Commissioner Response on November 25 entry of The Grid along with an audio recording of the meeting. Kimsey published his document on a webpage controlled by his office but refused to allow the Commissioner Response to be included. The report was quoted publicly as proof that the County Fee Waiver program was a failure, unsustainable, and should be discontinued.

http://www.clark.wa.gov/thegrid/

The Fee Waiver program has been in play now for more than two years and the evidence continues to reaffirm the success first documented by the Commissioner Response. In July 2015, the Columbian ran a story that cited Kimsey’s document as proof that the fee Waiver program was a failure.

To refute the claim, Madore published the history on a Fact Check webpage. The following quote included the reference to Couch:

“Clark County Commissioners approved the appointment of Forensic Accountant Tiffany Couch, founder of Acuity Forensics, to the Auditor Oversight Committee after Kimsey nominated her before he presented his Fee Waiver “audit”. Mrs. Couch is beyond reproach, is unwilling to compromise on any ethical issue, and of course, disagrees with Kimsey’s Fee Waiver “audit”. Couch deserves our highest respect.”

Couch then published a public letter discrediting Kimsey’s, confirmed her non-support of his document, and verified the truth of the story told in the Fact Checks page. That letter also objected to anyone referencing her name and faulted Madore for using her name in the above quote. However, the AOC is a public agency and the activities of that public agency are a matter of public record. It is appropriate to reference her role as a member of that public body.  Couch announced her resignation from the AOC. We are thankful for service and wish her the best.

David Madore
Clark County Councilor

This e-mail and related attachments and any response may be subject to public disclosure under state law.

Kimsey’s follow-up email to The Columbian

Hi Katie, below are three statements in today’s article regarding Tiffany Couch that I believe are inaccurate.  I would appreciate it if you would make these corrections.  If you want to discuss this, please call me at 360-521-6685.

Regards,
Greg

“Councilor Jeanne Stewart, chair of the oversight committee.” – the county  auditor is the chair of that committee. (County ordinance 2.14.070 Audit oversight committee.)

(1)    Purpose. The audit oversight committee’s function is to assist the county auditor and the board of county commissioners in fulfilling their fiduciary responsibilities, and to facilitate a direct line of communication between auditor and the board. The objective of the committee is to promote the effectiveness and integrity of audit processes.

(2)    Membership. The committee shall be composed of three (3) members, as follows:
(a)    The county auditor (chair);)

“ At the time the audit was released, the report concluded it had only created 115 jobs “  The audit report simply reports that businesses that received fee waivers created 115 jobs, it does not say that the Job Creation/Fee Waiver program created these jobs.  From page 7 of the audit report “Data from the State of Washington confirms that 115 jobs have been added by businesses that received fee waivers under the current program and completed their projects.”   This is very different from saying that the Job Creation/Fee Waiver program created 115 jobs.

.  http://www.clark.wa.gov/auditor/audit/documents/2014Audit_CC_Job-Creation_Fee_Waiver_Program.pdf

“The commissioners, Madore notes, posted a response to the audit on county website The Grid on Nov. 25, about two weeks after the official deadline to respond.” – This is not correct, the Board of County Commissioners have not provided a response to the audit.