The integrity of Durham city government is once again under fire as questions surface regarding the city manager's contract policies.

Several weeks ago, The Herald-Sun of Durham reported that City Manager Marcia Conner had violated city policy by granting a $30,000 contract to the Marshall Group--a firm hired to organize a $10 million effort to reinvigorate part of North-East Central Durham--without advertising the job or opening it up to bids from other firms. City policy requires that any contracts worth over $10,000 be advertised and bid on by competing firms.

The Marshall Group has also received payments from the city, yet the written contract between the two has not been signed by Conner.

When first questioned, Conner denied she had anything to do with granting the contract to the Marshall Group. The firm is owned by Byron Marshall, who served as assistant city manager of Austin, Texas, a post Conner occupied after Marshall left in 1994. However, at a Nov. 4 City Council meeting, she admitted having a role in the contract decision.

Mayor Bill Bell announced Monday that city auditors would examine every contract initiated by Conner over the past year. Also, the audit will look at a random sampling of contracts granted by other city agencies to ensure policies are being followed elsewhere.

"I think the reason he requested the audit was to look at the contracts that had come out of her office, [and also] to look at other city contracts to make sure the proper procedures were followed," said City Council member Lewis Cheek.

The audit should be complete by next Monday, when the City Council will hold a closed meeting to talk about Conner's performance, and then discuss the Marshall Group contract in particular at the council's regularly-scheduled meeting at 7:30 p.m. at City Hall. The council has the authority to reprimand Conner.

Council members say they will withhold judgment until the audit is completed Monday and more facts surface. "We're just trying to get a feel of the extent to which we have complied with policy," said council member Cora Cole-McFadden. Currently, however, she added that she does not see any explanation for the discrepancies.

"According to policy, in unusual circumstances she might be able to waive contracts," Cole-McFadden said. "But the [contracts] in question are the ones where the policy was very clear."

In a Nov. 10 letter to The News & Observer of Raleigh, Conner admitted to violating policy but wrote that she had Durham's best interests in mind.

"Since I arrived here, my focus has been on 'getting the job done.' And, I must admit, in my zeal to be responsive to the community... I've made some mistakes along the way," Conner wrote. "What was done was done in an effort to complete important projects, improve our city and move toward the future.... The old adage, 'you can be right, but not correct,' is probably appropriate for this situation."

Cole-McFadden said good intentions do not constitute a legitimate reason to neglect procedure. She added the current contract rules are in place both to minimize costs and to provide local businesses the opportunity to get city contracts.

"That's a very distressing piece to me," she said.

Conner began her public service career as a budget analyst in South Florida, before becoming budget director for Arlington County, Va. Conner served as Austin's assistant city manager last year, when she was asked to serve as Durham's city manager.