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City Discloses DME Investigation Findings

7/27/2017 12:00:00 AM

Todd Hileman, City Manager, has disclosed findings regarding the recent Denton Municipal Electric (DME) investigation into the procurement process for the Denton Energy Center (DEC). 

This initial review focused on the appropriateness of the proposal evaluation process. During the initial review, it was determined that the conduct of the staff and vendors during this process should be investigated. The City Attorney’s Office engaged the law firm of Allensworth and Porter, LLP, to conduct an independent review of the procurement process; and the law firm of Lynn, Ross, and Gannaway, LLP, was hired to independently investigate employee conduct. Findings from these reviews include the following:

  • Due to issues uncovered with the evaluation of proposals, the procurement process should have been restarted to resolve appearances of impropriety, to clarify performance objectives and scoring criteria for all vendors.
  • No “fatal flaws” in the procurement process were identified which would invalidate the contracts to build the DEC facility due to the time that has elapsed and money expended.
  • No evidence of fraud or any criminal activity was found with either employees or vendors.
  • Two DME employees have been terminated for their actions during the investigative process. 

“The City Manager and the Interim City Attorney initiated a comprehensive investigation into several concerns regarding the procurement process for the Denton Energy Center. I am confident the ongoing investigation continues to be thorough and appropriate. I look forward to working with the City Manager, Interim City Attorney, and my City Council colleagues to learn from this experience and develop stronger processes to prevent these types of issues from occurring in the future,” said Mayor Chris Watts. 

City Manager Todd Hileman stated, “I am committed to building an organizational team that is focused on fiscal accountability, transparency, and integrity, and we will not tolerate any actions that are counter to these values. We have made significant strides over the past few months, and our leadership team is committed to building a culture for the City of Denton that demonstrates our values, facilitates public involvement, and provides outstanding customer service. Additionally, the next General Manager for DME will be focused on building a culture of openness and collaboration with the Public Utilities Board, City Council, and residents of this city.”

The Denton Energy Center is currently under construction, and the completion of this facility is expected to occur in the summer of 2018. Over the coming weeks, the City Manager’s Office will focus our efforts to accomplish the following initiatives: 

  • Utilize independent energy experts to help expand the City of Denton’s renewable energy profile.
  • Complete a formal renewable integration plan for consideration by the City Council.
  • Craft a strategic plan for the Denton Energy Center, which optimizes its resources and engines to accomplish the above initiatives.

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