3 fired in cronyism scandal at Iowa communications agency
By RYAN J. FOLEY
Jan. 18, 2018
IOWA CITY, Iowa (AP) — The head of Iowa's state-run broadband network and two aides have been fired after investigators uncovered misspending, cronyism and self-dealing during his tenure, mostly linked to a Christian charity he also runs.
Ric Lumbard, executive director of the Iowa Communications Network since 2014, improperly awarded jobs and contracts to individuals affiliated with Wind and Fire Ministries, a nonprofit religious group where he is the CEO, according to an investigation released Thursday by State Auditor Mary Mosiman. Lumbard and two associates, Jessica Jensen and T.J. Boulet, were fired earlier this month before the report's release.
Investigators searched Lumbard's home, Facebook accounts and other items as part of an ongoing inquiry into theft and misuse of state funds. Investigators say a company associated with Lumbard sold $2,200 of state-owned audio and video equipment on eBay, pulling additional listings off only after state officials inquired. In all, the report cited $380,000 in payroll, travel and other costs that weren't in the taxpayer's interests.
Lumbard was on an extended medical leave before his termination and auditors weren't able to speak with him. He didn't return messages left at the ministry, where he lives on its property outside Cedar Rapids. Jensen and Boulet didn't respond to messages.
The agency, known as ICN, provides high-speed internet, video conferencing and phone services to schools, universities, hospitals and libraries.
Lumbard hired Jensen as his administrative assistant in 2015 even though she had little relevant work and education experience and didn't meet the minimum job requirements, the report said. She knew Lumbard because she's involved in the ministry's operations, which she sometimes performed on state time, the report said.
Jensen unnecessarily accompanied Lumbard on numerous out-of-state trips and received unjustified raises totaling 40 percent over a 2 ½ year period. Lumbard claimed he awarded her one 14 percent raise because she was offered a job by another agency, which wasn't true, the audit said. She considered Lumbard her best friend, telling colleagues she had no work to do when he was on leave because her job was to talk to him.
Boulet also didn't meet the minimum requirements for the legislative liaison position Lumbard gave him in 2016, when he was working for a trucking company. He had a relationship with Lumbard through the religious organization. Auditors said the $96,000 spent on Boulet's position was a waste because he often had no "meaningful work" to do when lawmakers weren't in session.
Auditors launched the investigation in July after employees raised concerns about an unusual transaction in which Lumbard spent $50,000 to buy two old television production trailers and a truck from a California nonprofit on eBay. Lumbard planned to use the trailers to create mobile units to support communications during disasters and promote cyber education, a plan other agency officials opposed.
Both trailers had equipment the agency didn't need and planned to auction. But Lumbard had the trailers shipped to the ministry's property instead of the agency's Des Moines office. The truck never arrived because it wasn't in a condition to be transported but Lumbard didn't seek any refund.
Danielle Steen, Lumbard's assistant at the ministry and a temporary employee for the agency, told investigators that Lumbard directed her to remove equipment from one of the trailers because it had been donated to the charity. Fifteen items were then sold on eBay through a Lumbard-affiliated company. The vendor disputed that it donated the equipment, saying it should have gone to the state.
The investigation uncovered other concerns. Lumbard improperly used a state vehicle to commute 140 miles to and from Des Moines at a cost of $50,000, and billed the agency for overnight lodging costs in Des Moines on several occasions. He and Jensen failed to take vacation days when they were in Belize for charity work.
Lumbard awarded no-bid contracts to a painting company affiliated with his ministry, and to another vendor who had done work for the ministry.
The report blasted members of the Iowa Telecommunications and Technology Commission for failing to supervise the agency as required by law despite being paid to do so.
"This audit exposed a long-standing, significant flaw in the ICN's accountability structure," said Brenna Smith, press secretary for Gov. Kim Reynolds.
Commission Chairman Richard Bruner of Clear Lake said he was surprised by the findings but doesn't intend to resign the $20,000-annual appointment former Gov. Terry Branstad gave him in 2011.
"It's a sad situation," he said. "Ric basically worked behind the scenes and even his senior staff wasn't aware of what he was doing. He bent the rules and in some cases broke the rules."