Staff at the Morgan City Housing Authority received improper bonuses and raises tota ling nearly $700,000 since 2007 in possible violation of state and federal laws, according to a state legislative auditor’s investigation released Monday.

Bonuses for administrators and employees of $566,544 were handed out under a policy that never received the required approval from the state Civil Service Commission, according to the investigative audit.

Auditors stated the Civil Service Commission had approved a one-time bonus for a “Rewards and Recognition” program in 2007, but the Housing Authority continued giving bonuses year after year under a policy supported with falsified paperwork to make it appear the commission signed off on continuing the program.

The lion’s share of the bonuses went to four staff members: Accounting Tech Diana L. Pace, Housing Manager Sandra Greene, Housing Manager Tori Johnson and Executive Director Charles E. Spann, according to the audit.

Greene, Pace and Johnson also received a total of $130,418 in raises since 2009 that auditors said exceeded what was allowed under civil service guidelines.

Spann told auditors he left much of the routine administrative duties to other staff members and did not know the employees had received such substantial raises or that the bonus payments were improper.

Johnson admitted altering the bonus policy to support the improper bonus payments but told auditors she did so at Spann’s request.

Spann and Johnson both stepped down last year, said Clarence Robinson Jr., the director of the Berwick Housing Authority who has been brought on as part-time interim director of the Morgan City agency.

Pace and Greene remain on the job, currently protected by civil service laws, he said.

Most of the questionable payments were made without approval from the Housing Authority board or the Civil Service Commission, Robinson said.

“That’s why these things were spinning out of control,” he said.

In a letter responding to the legislative auditor’s report, Robinson offered a long list of recommendations he plans to submit to the Housing Authority board.

Among them: submit the findings of the audit to federal and state prosecutors, explore litigation to recover the overpayments and consider filing charges with the Louisiana Ethics Administration against some staff members.

Robinson said the Housing Authority already has implemented policies to ensure no future raises or bonuses will be paid without proper approval.

“We have procedures already in place,” he said.