Karen Walsh

After months of bickering, a questionable bonus and three resignations from the McKamey Animal Center board, Chattanooga has asked its city auditor to put the nonprofit animal shelter under a microscope.

One question City Auditor Stan Sewell will ask is whether Executive Director Karen Walsh got a $10,000 annual bonus without a vote by the Chattanooga's Animal Care Trust board, McKamey's governing body. Later, Chairman Bruce Baird asked board members to approve the bonus retroactively by electronic vote. A state official said that likely violates Tennessee's open meetings law.

Since September, some board members have tried to force out Carol Goodman, a member who questioned Walsh's salary, and three others have resigned.

The letter that Chief Operating Officer Andrew Kean sent Wednesday asks Sewell to examine the board's governance and structure, financial controls and management compensation decision practices.

"We want to ensure that taxpayer dollars are appropriated as efficiently as possible and subsequently managed appropriately," Kean wrote. He said the auditor's office could start work in the next 10 days.

Walsh said in a telephone interview Wednesday that the bonus was in line with those of past years. Including her bonus, she is paid nearly $120,000 a year, only a few thousand dollars less than Chattanooga Police Chief Bobby Dodd.

"Nothing was any different than any other year," Walsh said. "As far as I'm concerned we're an extremely transparent organization. We have an audit every year. There's nothing we do that the board's not aware of."

Goodman said the city, which provides $1.5 million of the center's $2.2 million annual budget in exchange for animal control services, needs to conduct more oversight of the shelter. The former city representative on the board, Marie Chinery, left in May and no one has replaced her, Goodman said.

"I'm the only one voting in the city's interest," said Goodman, who was named to the board in 2008.

Baird could not be reached by phone Wednesday, but he sent the following statement late in the day via email:

"I have the utmost faith in the business practices of the McKamey Center," he wrote. "Any scrutiny of our organization will certainly result in a report of which we can be proud. Our annual independent audit and our last audit from the city both reflect an organization with detailed financial records and fiscal responsibility."

Board members whom the Times Free Press attempted to contact either could not be reached or referred calls to Baird.

Goodman started asking questions in May, when the board approved its 2014 budget.

In an audio recording of that month's board meeting, Goodman asks several times whether Walsh was getting her annual bonus. She wasn't given an answer.

Instead, Walsh asked Goodman: "We have employees that make eight dollars an hour, you don't think they need a raise?"

Treasurer Kevin Lusk tells Goodman the budget included $50,000 in salary increases for the staff, but that would require the city giving McKamey a 3 percent funding increase.

That didn't happen. Kean said the city administration felt that McKamey's funding level was appropriate.

The board didn't meet in June. Goodman said she learned after the July meeting that Walsh had been given the bonus.

On July 16, Baird emailed other board members saying the six-member executive committee had approved the bonus but he had forgotten to place the item on the July voting agenda. The Times Free Press obtained a copy of the email in which Baird asked the board members to vote by email whether to award the bonus.

"I apologize for this error and I want to ensure all board members that it was not done with any illicit intent to undermine the board," he wrote.

Goodman objected, along with members Jacqueline McNair Hamm and Ryan Picarella, citing Tennessee's open meetings law. Then Baird called a special board meeting on July 31 to vote on the bonus. Goodman was the only dissenting vote.

Elisha Hodge, director of Tennessee's Office of Open Records Counsel, said McKamey appears to be subject to the state's open meetings law and if so, the board wouldn't be allowed to vote electronically.

After Goodman filed an open records request for the center's financial records, other board members at the September meeting pressured her to resign.

"You mistreat all the board members," Secretary Nancy Dunlap told Goodman. "I felt attacked, I have felt personally attacked by you. If you don't want to be part of the team, then get off the team."

Goodman refused, but Hamm, Picarella and member Gene McGee resigned. Picarella declined comment Wednesday. Hamm and McGee could not be reached for comment.

Walsh didn't return calls seeking comment after the administration requested the audit Wednesday afternoon.

Contact staff writer Joy Lukachick at jlukachick@timesfreepress.com or 423-757-6659.