CRA Chief Cleared of Misusing City Funds : Contracts: The agency failed to follow proper procedures in the hiring of two PR firms, a review concludes. But it says John Tuite did not mishandle public money.

John Tuite, executive director of the Community Redevelopment Agency, did not misuse public funds in hiring two public relations consultants, but his agency failed to follow proper procedures in awarding the contracts, a city review has concluded.

“In our opinion, allegations that the administrator contracted with public relations consultants for personal gain are unfounded,” City Administrative Officer Keith Comrie wrote in a report Wednesday to Mayor Tom Bradley.

In July, Bradley had asked that city officials explore allegations that Tuite had mishandled contracts with two public relations firms, the Lippin Group and J.B. Duff & Co.

Questions had been raised over the hiring of outside publicists even though the CRA employs a full-time public relations staff.

A whistle-blower alleged that Duff & Co. was hired without competitive bidding, that the work involved personal promotion for Tuite rather than agency business and that documents involving the Lippin Group’s contract were backdated.

In a statement Friday, Tuite, who has held his $136,000-a-year post since 1986, said, “I trust that the report by the city administrative officer will finally put to rest the groundless allegations that had been leveled against me.”

In a letter to CRA board Chairman Jim Wood, Bradley noted that “the report generally supports the findings made by the CRA Board” on Aug. 3. The board determined then that Tuite had not improperly retained the publicists, but it also ordered a management audit of agency practices involving contracts for less than $25,000.

“I look forward to working with you . . . and Mr. Tuite as the CRA embarks upon its mission for the 1990s,” Bradley wrote.

In his report, Comrie concluded that the “CRA used funds appropriately” to hire the publicists because “the public information workload is greater than the staff can handle.”

But the 2 1/2-page report also said that in awarding the three contracts--two to J.B. Duff & Co. and one to the Lippin Group--”some CRA actions deviated from basic purchasing rules or good business practices.”

Duff had obtained two contracts totaling almost $50,000, according to previous reports, and Lippin one for $25,000.

Although the Comrie report did not directly state that the agency failed to use competitive bidding in awarding the Duff contracts, he wrote that in the first Duff contract two other bidders “were reportedly contacted only for price comparison. Selection of the highest-priced vendor was not justified.”

“The vendors’ qualifications were not verified independently,” Comrie wrote. “There was no evaluation of service quality.”

Although the Comrie report did not say documents involving the Lippin Group contract were backdated, it said the justification for hiring Lippin and the contract document “were prepared nearly three months after the contractor started working.”