BRADENTON, Fla. — Miami’s former budget director, Michael Boudreaux, on Monday filed a whistleblower lawsuit claiming he was fired for “telling the truth and reporting about malfeasance” by former and current city hall officials.
Boudreaux was fired March 8 after a city auditor late last year questioned some interfund transfers to balance the budget, some of which had occurred over several years. Boudreaux said no transfers were made without first being approved by his bosses and city commissioners.
The Securities and Exchange Commission later launched an investigation into city’s finances, apparently to determine if Miami properly disclosed its financial condition to investors in bond documents.
City police also have an ongoing probe into missing computer files from Boudreaux’s office, which occurred the day before he was fired. The files were recovered but it is still unknown who tampered with the city’s computer.
Boudreaux’s suit said the city “intentionally and maliciously” fabricated false allegations that he had deleted the files.
“This complaint concerns the actions of city of Miami officials to punish, smear, and even concoct false allegations of criminal conduct against this dedicated city employee who dared to tell the truth,” Boudreaux’s whistleblower suit said.
The eight-page complaint said Boudreaux was “terminated in order to discredit him, to silence him, and to prevent him from cooperating in ongoing investigations.” Boudreaux is asking the court to reinstate him as the city’s budget director. He is seeking lost wages and to have his legal costs paid.
City officials did not respond to a request for a comment by press time. It is not clear if the whistleblower suit could affect the SEC investigation.
Miami hired Morgan, Lewis & Bockius to represent it in the SEC matter. Christian Bartholomew, a partner at the firm, had no comment about the suit yesterday.
Boudreaux told The Bond Buyer in December that all expenditures and transfers were approved by city commissioners. He welcomed a probe into Miami’s finances and said, “We’ve always been honest and open about the finances of the city.”
Late last month, city officials learned that Miami would close out fiscal 2009 with a $53.6 million deficit caused by declining revenue, overspending, and transfers between accounts to maintain reserve requirements. The loss was covered by reserves.
Miami last week released its 2009 audit and resumed plans to sell $120 million of revenue bonds to build four parking garages and refurbish existing parking for a new baseball stadium being built for the Florida Marlins. The deal was put on hold last year due to the financial problems.
Two weeks ago, Moody’s Investors Service placed a negative outlook on Miami’s A2 general obligation bond rating because of the city’s weakened financial position. Fitch Ratings had placed a negative outlook on its A rating last October. Miami’s GOs are rated A-plus with a stable outlook by Standard & Poor’s.
Analysts from all three agencies have cited concerns about the city’s finances because of the recession as well as rising pension and health care costs. Moody’s, in a recent report, also said the city had “poor budgetary practices that have made adherence to established financial principles unsustainable.”
The lawsuit was filed in the 11th judicial district circuit court in Miami-Dade County.