Is City Administrator Deborah Edgerly Corrupt?

That's a question the U.S. Attorney could be called on to answer pretty soon.

The San Francisco Chronicle has a damning article in Friday's paper about a whistle-blower lawsuit filed by a former Oakland city Controller Larae Brown. According to reporter Chip Johnson, who deserves a Pultizer for his fearless local reporting, Brown said she was fired last year after she informed her superiors and elected city officials of potentially disastrous flaws in the city's bookkeeping.

The HarriOak News doesn't usually publish extended excerpts, but you have to read this (then please go renew your subscription to the Chronicle).

"Brown, who turned down a settlement offer from the city, is asking for $1.5 million in damages and compensation. She is suing the city for retaliatory discharge, emotional distress and violations of the right of free speech.

"She was fired in March 2007, four days before she was scheduled to meet with newly elected City Auditor Courtney Ruby and an outside financial auditor about her findings.

"The trouble began in 2006 when Brown completed a reconciliation of more than 100 city bank accounts, a task she alleges had not been performed since 1999 - and what she found was extremely troubling.

"In her review, she discovered the city's cash balance was overstated by $172 million and 77 of 111 city accounts showed negative fund balances. By her estimates, all that was left in city coffers were bond funds, whose use is restricted by state law.

"When she raised concerns with her superiors, the suit claims, she was told that City Administrator Deborah Edgerly had devised a 10-year repayment plan to cover a half-dozen negative fund balances. Brown claims she also discovered the city had commingled bond funds with various city general business funds, which also constitutes a serious violation of a public employee's fiduciary responsibilities.

"Edgerly denied Brown's version of the accounts and said the lawsuit is without merit, said Karen Boyd, a spokeswoman in the city administrator's office. Boyd pointed to the outstanding credit rating the city recently received from both Moody's and Standard & Poor's, two of the nation's largest bond-rating concerns.

"That may well be, but if even one of the numerous allegations made by Brown has merit, it means that Oakland City Hall is either inept - or something worse - when it comes to maintaining clean financial records and holding the public trust.

"And even as Edgerly's office denies the claims in the lawsuit, Brown alleges that city Budget Director Jim Smith and two budget analysts went over Brown's accounting work, came up with the exact same conclusions and took that information to Edgerly.

"According to the lawsuit, Edgerly would neither address the issue nor inform the City Council of the problem.

"Brown also pointed to accounting errors in the Police Department that allowed some employees to receive overtime pay for holidays they didn't work.

"Between 2003 and 2005, Brown found more than 950 city employees who were paid 22,000 hours for time they never worked. When city officials tried to correct the problem, Edgerly rejected it and said the money awarded would be recategorized as a "beneficial past practice," the suit claims.

"Edgerly also took advantage of the city's ineffective internal monitoring to grant herself a big payday, according to Brown.

"Between 2000 and 2006, Edgerly cashed in $183,000 in vacation, sick pay and management leave. Separately, she awarded herself an additional $60,000 in bonuses during that period. According to the lawsuit, no other city employee has been allowed to cash out benefits in such a manner.

"Burris said he did not enter into the case lightly and investigated his client's claims before moving forward because of the potential damage it could cause to the reputation, standing and the integrity of local government.

"'It wasn't like we did this willy-nilly,' Burris said. 'We did a lot of checking before we brought this lawsuit because this is a very serious matter.

"'I understand the city is playing hardball and denying the claim,' Burris added, 'because the allegations are serious. But it's our view that this woman was fired for simply trying to bring forth items of concern to her superiors.'

"Before she lost her job, Brown was transferred out of her position in the controller's office and reassigned in an effort to muffle her complaints, Burris said.

"My guess is that Brown's lawsuit will never see a courtroom because the city stands to lose too much. If there is a kernel of truth to any of the claims made by this former city employee, it would sink careers and maybe even launch a criminal investigation.

"On behalf of all Oakland residents, I want the case to be heard and the truth exposed, however ugly it is.