Oklahoma Secretary Of Tourism Denies Auditor’s Claim Of Conflict Of Interest

Oklahoma's State Auditor said she's sounding the alarm on misspent federal dollars dating back to 2020.

After Cindy Byrd released her report, Attorney General Gentner Drummond asked a state secretary to resign. 

Related Coverage: Oklahoma Attorney General Calls For Immediate Resignation Of Oklahoma Secretary Of Tourism Following Audit

Byrd said the state’s Emergency Rental Assistance program had more than $20 million in questionable costs. She also said Oklahoma’s contract process is unfair to taxpayers. If numbers about Oklahoma expenses paint a picture -- Byrd said Oklahoma failed to color inside the lines. 

“Taxpayers should be very concerned,” Byrd said. “We found several issues that we found through some vendor contracts.” 

Byrd issued a federal audit report revealing millions of dollars in questionable costs. Byrd said the Emergency Rental Assistance program through the Office of Management and Enterprise Services produced $21 million in questionable costs – $8 million tied to what Byrd called “excessive management fees”. Byrd said some of that money could have paid for housing and utility bills for people who need assistance.  

“Had that been utilized for Oklahoma's neediest, we could have assisted five thousand more people,” Byrd said. “That’s a lot of people who may have needed help.” 

Byrd’s report also pointed out an issue with Oklahoma Secretary of Tourism Shelley Zumwalt who served in multiple roles with OMES and was the Executive Director of the Oklahoma Employment Security Commission (OESC). “Director Zumwalt did have a conflict of interest and did not disclose that,” Byrd said. 

Byrd says Zumwalt failed to report that her husband worked for a software development company contracted with the state. Zumwalt firmly denied Byrd’s claim. “The auditor’s report is misleading,” Zumwalt said. “I was assured there was no conflict of interest. I have disclosed many, many, many, times to all parties that my husband is an employee of this company.” 

Zumwalt was asked if there was a paper trail proving no conflict. She said her husband was not part of the work contracted through the state. “I don’t know how you prove a negative,” Zumwalt said. “He never worked on state business.” 

Byrd said the contracting process at OMES needs changes. “That is the root of all of these problems,” Byrd said. 

Byrd’s report recommended state lawmakers review the following, 

1. “Investigate the ‘Rolling Solicitation’ process employed by OMES.” 
2. “Investigate the revenue stream associated with the ‘Rolling Solicitation’ process and determine if this has created an incentive for not complying with sound competitive bidding procedures.” 
3. “Review the growing list of exemptions to competitive bidding laws that do not protect taxpayer dollars.” 

Byrd said taxpayers could pay the price the numbers in her report illustrate in Oklahoma. 

“If the federal government decides to claw that back, Oklahoma will be on the hook to repay those funds,” Byrd said. 

Attorney General Gentner Drummond said "patterns of mismanagement" cost taxpayers millions. He said this should lead to Zumwalt's resignation -- but Zumwalt stood by her comments on Tuesday. Zumwalt said she would not step down.