FORT SMITH (KFSM) -- State Senator Jake Files and his business partner Lee Webb are under scrutiny after an auditor for the City of Fort Smith told city leaders contractor bids submitted by their non-profit may have been falsified.
The River Valley Sports Complex, a 1.6 million dollar project was approved by city leaders to be developed by RVSC, operated by Files and Webb.
The project has been in the works for years. City of Fort Smith leaders said they terminated their contract with RVSC when the development was met with several delays.
According to city leaders, Sen. Files applied for a General Improvement Funds grant to pay contractors to lay electric and water lines.
Three contractors are on file with the City of Fort Smith as though they put in a bid to win the work. City Administrator Carl Geffken said the city auditor found a discrepancy in those bids.
"Our internal auditor went out and spoke with one of the bidders and that was Lego. They said they did not submit a bid. Williams Lighting and Electric,over the phone, did not get a chance to meet with them but spoke with them several times but they too say they did not submit the bid," Geffken said.
A contractor listed as Dianna Gonzalez won the bid and the city leaders said they paid her through a wire transfer.
According to city emails, this is a contractor that Files has employed in the past.
"Our attorney has prepared a draft letter for me to review. I am currently reviewing, that is a formal request to return the $29,945 that we had wired into Ms. Gonzalez's account," Geffken said.
5NEWS spoke to Mr. Webb who referred comment to Files. Files was not available for an on camera interview but did want to comment on the issue.
"I want to be extremely clear. There is no fraud. No falsifying bids," Files said.
He also went on to say he is in the process of obtaining phone records that will prove he spoke with the construction companies in question.
How this controversial issue will play out is still to be determined, but from the city's standpoint Geffken said they want construction of the sports complex to move forward.
"How we move forward will be determined by the final results we get from the firm we've hired to review the plans, review the construction that's been done to date," Geffken said.
Fort Smith city leaders said contractors are starting to come forward with unpaid invoices. The invoices are from the companies who claim they provided work at the sports complex but have not yet been paid.
City leaders said there are currently three contractors on file that have submitted invoices to the city offices.
City administrator Carl Geffken responded to one of the contractors, B&A Electric in an email:
"The city of Fort Smith contracted with the River Valley Sports Complex for this project. The fact that the city terminated its agreement with the River Valley Sports Complex does not extend to the city's assumption of liabilities incurred by the River Valley Sports Complex. All outstanding liabilities or amounts due remain the responsibility of the River Valley Sports Complex, and not the Cit of Fort Smith," Geffken said in the email.
Geffken also sent a letter to Jake Files and Lee Webb on the matter:
"It has come to my attention that one or both of you, as representatives of the River Valley Sports Complex entity, have directed vendors or subcontractors to submit any outstanding invoices to the City of Fort Smith. Please allow me to remind your that the City of Fort Smith does not have a relationship, contractual or otherwise, with the vendors or subcontractors enlisted for goods or services provided for or on behalf of the River Valley Sports Complex. The city has and will continue to inform all such vendors or subcontractors that any outstanding liabilities or amounts due remain the responsibility of the River Valley Sports Complex entity and/or whichever one of you may have enlisted their services on that entity's behalf," Geffken said in the email.