Records detail allegations against former Sauk County Highway Commissioner

Retired Sauk County Highway Commissioner Steve Muchow's former work truck sits outside the agency's West Baraboo headquarters Friday. Employees alleged Muchow manipulated financial information to ensure the cost of the truck did not exceed his $30,000 purchase authority.

TIM DAMOS/News Republic

Documents show government employees alleged that their boss, Sauk County’s former highway commissioner, repeatedly misused his position to benefit himself and friends at the expense of taxpayers.

The documents, recently obtained in response to a public records request, outline the allegations that prompted a personnel investigation of Sauk County Highway Commissioner Steve Muchow.

Officials dropped the probe in April after Muchow gave notice of his intention to retire. Details of the employees’ complaints have remained murky until now.

The clearest summary is contained in an April 25 report that Madison accountant Marty Mathias, who specializes in fraud investigation, provided to Sauk County Administrative Coordinator Alene Kleczek Bolin. Mathias was hired to look into the matter, but he never finished his work.

The report outlines Mathias’ interviews with six Highway Department employees. It details allegations that Muchow repeatedly used county property for personal reasons, misrepresented financial information, manipulated bids, misused his relationships with private businesses and falsified timecards.

Muchow, who became highway commissioner in 1992, has denied any wrongdoing and said he was not aware of the investigation when he decided to retire April 27.

Personal pit

Three employees reported that the Highway Department has stored equipment and inventory, such as topsoil and gravel, at a pit Muchow owns in the town of Ironton. They said county-owned material has disappeared from the property, and they suspect Muchow may have used it himself.

A highway patrol superintendent who provided officials with a dated log of allegations said Muchow had two buildings from a decommissioned county nursing home moved to his pit in 2011.

Kleczek Bolin, the county’s administrative coordinator, confirmed in a June 16 email that the buildings were indeed moved to Muchow’s pit, but she said the county didn’t want them any more.

“This does not follow the proper county procedures for disposal of unwanted property,” Kleczek Bolin said. “It is not property that has any value to the county.”

The employee’s log outlines numerous other instances in which Muchow allegedly used county equipment for personal reasons, or had county employees do work for his friends.

Financial manipulation

Two employees who worked directly under Muchow and had access to financial records suspected that he manipulated financial information to keep expenses from exceeding a $30,000 limit on his purchase authority.

One employee pointed to a pickup truck Muchow purchased for his on-the-job use as an example.

County policies dictate that the Sauk County Board’s five-member Highway and Parks Committee must seek approval from the full board for purchases over $30,000.

Meeting minutes show that on Jan. 11, the committee authorized Muchow to purchase the truck for just under that amount. The panel approved spending $29,525.

But expense reports show that a month later, the Highway Department paid Ewald Motors of Oconomowoc $30,154 for the Chevy Silverado.

In a June 15 phone interview, Muchow said the cost of the truck itself was under the $30,000 limit. It was after he purchased the vehicle, Muchow said, that he decided to buy a bed cover for it, and that’s why reports show a higher cost.

“That was a totally separate purchase,” he said.

Documents show the auto dealer billed the county for the truck and the bed cover on two separate invoices. But the invoices are both dated Feb. 3 and include the same transaction number.

Misuse of vendor relations

One employee provided Mathias with documents that reportedly showed Muchow made personal purchases from a company that does business with the county. The purchases looked as though they were made for the Highway Department, but the items were to be sent to Muchow’s home address.

Muchow allegedly paid for the items with his personal PayPal account. However, the employee said the business provides a discount to the county, for which Muchow may have received an inappropriate benefit.

Mathias, the accountant, who declined to comment for this story, also reported that two of the invoices suggest Muchow did not pay sales tax.

In another instance, the employee alleged, Muchow contacted at least four companies that do business with the county to ask for their assistance in getting tickets to a Las Vegas NASCAR race he wanted to attend.

Bid manipulation

The same employee alleged Muchow manipulated bid processes to ensure that deals went to businesses he was friendly with.

The employee told Mathias that the county recently awarded a bid for the purchase of oil to a company that employs Muchow’s friend, even though it was not the low bidder. Muchow allegedly told his oversight committee that the losing bidder had liability issues regarding the transport of oil, even though that was not the case.

“The losing bidder allegedly had no such issues and was never asked to comment on this when providing the bid specifications,” Mathias wrote in his report.

The employee alleged the Highway Department has purchased tractors from a business owned by another Muchow friend since 2014, even though the tractors “did not meet bid specifications that the losing bidders appropriately included in their bids.”

One of the two employees with access to financial records described an incident in which the county took an unexplained $10,000 loss on a $50,000 batch of seal coating chips.

The chips were maintained at the business that sold them to the county. In 2014, the employee said, the county learned that $25,000 of the inventory was gone, but the business only refunded the county for $15,000 worth.

“(The employee) questions why the county would have to recognize a loss for these seal chips,” Mathias wrote in his report.

Another allegation included in Mathias’ report details an already-substantiated claim that a $136,000 budget overrun on a construction project Muchow managed was never reported to his oversight committee.

The Baraboo News Republic requested records related to the highway commissioner investigation on May 19. Two months later, on July 19, Sauk County Principal Assistant Corporation Counsel Deb O’Rourke provided 97 pages of documents that did not include Mathias’ report.

The newspaper followed up, asking in a July 21 email why no records generated by the private accountant were included. O’Rourke emailed a copy of the report 10 days later, saying she thought she had included it in the initial batch of documents.

Follow Tim Damos on Twitter @timdamos

Reporter for the Baraboo News Republic.