Police investigate fired agency director’s use of public money

LYNNWOOD — The discovery of one lie at a public agency in Snohomish County turned up much bigger lies, including the apparent theft of public property that may total in the tens of thousands of dollars.

Mark S. McDermott, the former director of the Snohomish County Emergency Radio System, was fired Oct. 8 for lying about his credentials. The way he ran the agency, which oversees about $25 million of public safety equipment, created distrust and a lack of transparency, according to public records obtained by The Daily Herald.

A review of financial records showed that McDermott, 63, also allegedly used taxpayer money for personal purchases that had nothing to do with his job, including about 100 tons of gravel for a road behind his house.

The Lynnwood Police Department is investigating McDermott on suspicion of felony theft.

The emergency radio system serves every city in Snohomish County and more than 2,000 first responders. Known locally as SERS, the agency was formed in 1999 with a board of police and fire chiefs and elected officials. The board president is Marysville Mayor Jon Nehring.

The board didn’t find out about the apparent thefts until two weeks after McDermott was fired, Nehring said. He immediately notified police and the state Auditor’s Office.

“From Day One, our goal has been to be transparent and deal with it swiftly,” Nehring said. “What we’re trying to do is do the right thing and get beyond this.”

Nehring and Lynnwood Police Chief Steve Jensen, who’s also on the SERS board, had asked McDermott multiple times whether he had a college degree and a professional engineering certification. He was using the designation “P.E.” after his name, records show. McDermott’s equivocal answers led them to ask for proof.

After McDermott was fired, the board appointed an interim director, who started going through the agency’s invoices.

On Oct. 23, a Friday afternoon, the interim director called Nehring and they met at 4 p.m., not wanting to wait a weekend.

Some of the invoices listed heavy equipment that never was added to the SERS inventory, Nehring said. Other invoices “didn’t make sense,” Nehring said. “There’s no reason for SERS to buy grass feed” for a lawn.

“I was personally very surprised,” Nehring said.

“We were all surprised,” Jensen said.

On Nov. 11, when detectives arrived to serve a search warrant at McDermott’s Arlington-area home, he was installing a security system. It allegedly had been purchased with public money, according to an affidavit filed in a Snohomish County district court.

Investigators have conferred with prosecutors on potential charges, Lynnwood Police Cmdr. Steve Rider said Wednesday.

SERS, which recently moved from Everett to Marysville, has eight full-time staff. The 2015 budget is about $2.4 million. The most recent audit by the state, published Sept. 24, found no major problems.

McDermott was hired as a technical specialist in 2001. In 2013, the board asked a recruiting firm to search for a new director, and McDermott applied. His resume at that time didn’t list a college degree or a professional engineering certification.

A degree isn’t required for the job, which pays $128,000 a year.

After McDermott was promoted, he started representing himself with electrical engineering credentials. His technical skills lent him credibility, officials said.

No one noticed the lie until a few months ago, when McDermott came under fire for giving staff pay raises and promotions without going through the proper channels. The salary increases were buried deep within the budget.

An Everett law firm conducted an internal investigation for SERS this summer.

The board met with McDermott on Aug. 28. He promised to improve communication and dispel “any pending distrustfulness.”

In September, Jensen and Nehring started asking McDermott about his credentials. The answers varied.

Nehring sent him a letter Oct. 1 saying he was being placed on paid leave, and likely would be fired.

“You lied directly to me,” Nehring wrote.

In the Oct. 8 termination letter, Nehring wrote, “This situation is most unfortunate and disconcerting.”

That was before he learned about the alleged thefts.

By the time police went to search McDermott’s home Nov. 11, they suspected he had substantial property belonging to SERS, and a lot of it had nothing to do with his duties.

The search warrants list a $33,000 tractor, multiple trailers — including one worth $8,500; a lawn mower, cellphones, computers and tablets. McDermott reportedly used SERS-owned generators to power his house during outages.

McDermott later returned a missing aerial drone, the kind used by hobbyists to take pictures. Staff told police they’d heard SERS had a drone, but it had never been used for radio tower maintenance.

The day detectives arrived, McDermott was installing a security system on his 2,700-square-foot house. Another surveillance system already was set up elsewhere on his property. Both allegedly were purchased with taxpayer money.

After the Nov. 11 warrant, McDermott was taken to the Lynnwood Police Department for questioning.

Lynnwood detective Scott Dilworth specializes in financial crimes. He’s a member of the U.S. Secret Service Electronic Crimes Task Force out of Seattle. He pored over SERS invoices.

One bill was for 48 tons of gravel. Dilworth checked Google Earth archives. A gravel road showed up on McDermott’s property this spring.

Between February and August, McDermott used SERS accounts to buy 80 more tons of gravel.

In 2014, he purchased more than 550 yards of topsoil. There is no SERS property that would require topsoil, employees told detectives.

Despite the recent troubles, the emergency radio system remains a reliable and critical communication link for Snohomish County, Nehring said.

“We’ve been spending an extraordinary amount of time on (the McDermott matter) through the last three or four months because it is such a crucial thing for us to ensure the integrity of the organization,” he said.

He added: “The due diligence on the smaller matters led to this.”

Rikki King: 425-339-3449; rking@heraldnet.com.