Deborah Holston, assistant city manager for development, said Monday that the city expects to hire a new community development director in the next six weeks. The job has been vacant since December, when former director Peg Moertl quit after the Empire Theatre and rental rehabilitation program scandals.

"We have a pool of candidates who are going through the interview process," Holston said.

Finding permanent leadership was one of several recommendations that came from an internal city audit that found the agency in chaos. The audit, opened a year ago, examined the community development and planning department going back five years.

Mark Ashworth, internal audit manager, said he found that the department lacked focus and direction, had inconsistent policies and procedures and insufficient supervision. He said the department also suffered by having a series of acting directors in the past year.

"We looked at (three) prior audit reports and found a lot of the same recommendations," Ashworth said. "We found one audit over 10 years old and the problems still have not been corrected."

Retirements and other turnover in key jobs caused caseloads to increase for supervising development officers, Ashworth said. The added workload, he said, kept the supervisors so busy they had no time to monitor their subordinates.

"The supervisor had not been kept in the loop. So when some of these projects went south, they didn't know anything about it," Ashworth said.

The department's most notable and public recent failure was not properly overseeing the renovation of the former Empire Theatre on Vine Street in Over-the-Rhine. The agency also came under fire for mismanagement of the city's rental rehabilitation program.

City Manager Valerie Lemmie said the city would be more careful with development projects. She defended the department's staff by saying, "we have bad systems, but not bad people."

Among planned improvements are:

• Increased staff training and closer monitoring of city loans and contracts.

• Reduction of the number of full-time staff from 77.5 to 57 by 2006 by outsourcing some services.

• Creation of five "strike force" teams that would work with neighborhoods to identify and deliver development projects.

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