According to the report, Vaudt said CDBG guidelines indicate projects are only supposed to be charged for the expenses incurred.

The matter was originally brought to state officials' attention by a lawsuit filed by a former Area XV RPC housing director. But the Courier has also learned that three former RPC board members, including Mike Petersen, Dean Kaster and Denny Ryan, began looking into the issue further and eventually made their concerns known to the Attorney General’s office.

“The people on the board are good people, but they didn’t know what was going on,” Ryan told the Courier Wednesday.

He said once he, Kaster and Petersen discovered inconsistencies over billing issues, they tried to get answers from RPC administration.

“We [resigned] from the board when we couldn’t get any answers from anyone,” Ryan said, singling out Foudree. “We were concerned and I’m glad this report finally brought something to light.”

Area XV RPC Board Chairman Lawrence Rouw told the Courier Wednesday that there’s a possibility that he and other board members will call for a special meeting between now and the next regularly scheduled meeting on April 22.

He said he wants to speak with all board members before any decision is reached.

Rouw also said he has spoken with Foudree about the state auditor’s findings but declined to specify what they discussed.

Foudree told the Courier late Wednesday that she had seen the auditor’s report but was not able to comment at this point due to confidentiality issues with the lawsuit from a former employee and pending the board’s findings in the audit.

“I’m not able to offer any official comments at this time,” she said. “But this will be an ongoing process.”

Scott Niles can be reached at (641) 683-5360 or via e-mail at sjniles@mchsi.com.