The Columbus Police Department is investigating whether there is a criminal component to the allegation that a vendor repeatedly overcharged the Muscogee County School District.
In an interview Monday night with the Ledger-Enquirer, MCSD superintendent David Lewis confirmed the police probe concerns the invoices Moseley Auto Repair of Columbus sent the district for servicing school bus air conditioning units this past fiscal year.
Columbus Police Maj. Gil Slouchick also confirmed the investigation Tuesday.
“It’s in the real early stages,” he said. “It’s a fraud allegation. The financial crimes unit is looking into it.”
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Shop owner J.R. Moseley denied the allegation but declined to comment further.
MCSD asked the police to investigate the allegation after being alerted in March, Lewis said.
"We were told by an independent source," he said, "but we were already in the process because of an internal audit being done, part of a routine audit process, so it was the combination of the two."
That "independent source" is Charlie Miller, the lawyer for Truck Air Service of Cataula, which had the contract to service MCSD's school bus air conditioning units before Moseley won the bid. The Muscogee County School Board approved the contract with Moseley during its June 16, 2014, meeting.
Miller gave the L-E copies of MCSD documents he received through two requests under the state's Open Records Act, one in August and the other in February. Valerie Fuller, the district's communications director, verified the documents' authenticity Tuesday.
Miller said his investigation is based on his client's knowledge of the business and an Internet search for prices on parts and labor. He inspected 36 invoices from Moseley and estimated the district was overbilled by a total of at least $12,000 on a contract that caps expenses at $30,000. Only seven of the 36 invoices didn't include overcharges, according to Miller's analysis.
"I don't want to accuse anybody wrongly," he said, "but it appeared to be fraudulent."
The bid from Truck Air Service offered to do the work for $84 per hour in labor and a markup of 32 percent on parts. Moseley's bid, which was accepted in the contract with MCSD, allowed charges of $70 per hour for labor and a parts markup of 12 percent. Miller, however, discovered invoices from Moseley with parts marked up more than 100 percent and labor charges for more than double the time the jobs should take, according to a published guide and invoices from previous years, he said.
For example, a July 29, 2014, invoice from Moseley billed the district $1,715.11, and Miller estimated the charge should have been less than half that amount, $820.65.
In March, Miller said, he shared his findings with MCSD officials. That's also the time frame when the district terminated the contract with Moseley and awarded it back to Truck Air Service, which was the second-lowest bidder, Lewis said.
Moseley and Truck Air Service actually were the only two bidders because the 13 other vendors MCSD contacted didn't respond to the invitation. It also was a rebid because the original one in April 2014 "yielded results that were not acceptable to the Transportation Department," the administration said in the June 16, 2014, agenda item submitted by MCSD transportation director Frank Brown and then-operations chief Myles Caggins, who retired in November.
The Ledger-Enquirer asked Lewis whether Caggins' retirement or the retirement of chief financial officer Sharon Adams, also in November, was connected to Moseley's alleged overbilling.
"Not at all," he said.
Asked whether any MCSD employees are being investigated for impropriety because of the allegation, Lewis said, "Not at this point. What we're turning over to the police department is to determine if there was any criminal activity, and then from there where that leads us, we'll just let them determine that for us."
Lewis added, "We're going to be vigilant in making sure that the taxpayers' money is utilized the way it was intended, and if there is any deviation from that, then we will take any appropriate action that is necessary and warranted."