Business

City to release internal audit into building division practices complaint

CCCIA requested joint legislative auditing committee investigation into alleged Building Department Fund mismanagement

The city is firing back at the organization that represents its primary economic driver.

An internal audit was performed to address the Cape Coral Construction Industry Association's letter concerning the city's building department financial practices and a detailed response will be released Friday, Cape Coral City Manager Michael Ilczyszyn said, calling the CCCIA's complaint into city practices "deeply disappointing" and without merit.

"Over the past several weeks we have been working on an exhaustive internal review because of the letters sent from an association in our community representing contractors, which contained a series of allegations regarding operations, finances, and regulatory practices in our building division and building fund," Ilczyszyn said. "As of this evening, city staff has concluded a thorough review of every claim in that letter. The documentation that we have compiled demonstrates the assertions made are either baseless or unsupportive and often times a fundamental misunderstanding of our internal processes, state law or standard municipal accounting practices."

The CCCIA sent a letter to State Rep. Mike Giallombardo and Sen. Jonathan Martin on Sept. 25 with the subject line "Re: Urgent request for joint legislative auditing committee investigation of Cape Coral Building Department Fund Mismanagement."

The letter addressed what it said were critical areas of concern - apparent violations of Florida Statute 553.80, questionable interdepartmental transfers, systemic operational issues affecting industry and consumers, and impact on Cape Coral community.

The letter requested an investigation focusing on a forensic accounting audit of the Building Department Fund from 2014 to present, a review of all interdepartmental transfers and service fees charged to the building fund, examination of compliance with the statute and assessment of operational practices for consistency and statutory compliance.

At Wednesday's Cape Coral City Council meeting, Ilczyszyn displayed a stack of papers, stating that the document was a result of several weeks of work by city finance staff, development service staff, city auditor and legal - a response to every assertion made.

Ilczyszyn said it is deeply disappointing that an organization representing licensed professionals in the community would issue a letter of this magnitude without "first verifying the facts - seeking clarification or engaging even in the most basic due diligence."

"Instead, what has been issued is an assortment of uninformed interpretations, misapplied statutory citations, and inaccurate assumptions supported by backup material that frankly is embarrassing and its incompleteness or lack of connections to the assertions targeted at this organization," he said. "These documents came directly from the organization that wrote the letter. This is an AI summary that they submitted."

Ilczyszyn said there were 258 pages in total.

"Of those 258 pages there were 176 individual emails and four emails specifically addressing permitting and inspection issues," he said of the package that was sent to state representatives as grounds for an audit.

Ilczyszyn spent time going through the four emails, which ranged from a September 2025 PDF of the Cape Coral Sun, an email about top talent ready to drive projects forward of two highly skilled construction professionals whose expertise aligns with the city's operational needs and project goals, a business tax receipt sent from the city, an email asking for an additional check for a trade show booth, an introductory credit card with zero percent interest and a permitting issue with an HVAC permit that failed final survey review.

"These are the complaints. These are the backup documents supplied to our state representative. I would be embarrassed if my staff transmitted something to me," he said.

Ilczyszyn said if concerns are raised in good faith, the city addresses them in good faith.

"If they undermine resident confidence, disrupt development activity and unfairly impugn the integrity of my employees, it is important that we respond swiftly with the facts," he said. "This Friday I will be providing a detailed written response. It will demonstrate the commitment to compliance and address each point raised in the letter."

Ilczyszyn also showed Council a binder that he said has the letter with 26 allegations, which are identified by number and accompanied by the statement from the letter and which department is responsible.

"For each one of these there is a cover page that has their assertion, our detailed response and list of all the attachments governing that response. This is what a professional organization looks like," he said.

The city has a Building Industry Oversight Committee and Ilczyszyn said a lot of the misunderstanding came from information they were going over every other month with city staff.

"I directed my staff to make changes of how it operates," he said. "I am sending a recording secretary in those meetings."

There are no more than five individuals allowed in attendance at the meeting.

"No more opportunity for misunderstanding or misclassification," Ilczyszyn said.

The CCCIA issued a statement on Friday in response to the city manager’s comments.

“The Cape Coral Construction Industry Association (CCCIA) issued a statement today regarding the City's recent comments about the documentation submitted in support of the CCCIA's request for a state audit of the Building Division and Building Fund,” the release states. “The CCCIA acknowledges that a small number of unrelated documents were inadvertently included in the materials sent to the Joint Legislative Auditing Committee. This clerical error is being corrected.

“The CCCIA emphasizes that numerous other emails, records, and member-submitted documentation clearly support longstanding concerns about infficiencies, delays, inconsistent plan review outcomes, repeated requests for the same materials, and unexplained financial transactions within the Building Department. All of these issues have been a part of ongoing stakeholder meetings with the City by several committees, over the past several years. These systemic issues have contributed to low morale and a permitting process that is widely viewed as burdensome compared to neighboring municipalities.”

"These challenges make building in Cape Coral increasingly difficult and discourage investment and progress," the organization stated. "Our request for an audit was submitted

in good faith, based on documented experiences from licensed professionals who work within this system daily and we stand by our submittal."

The CCCIA stands by its request for a state audit.

standing by the need for an independent review to restore confidence and improve

departmental performance.

"Our goal is not confrontation--it is improvement. Cape Coral deserves a permitting system that is efficient, consistent, and accountable," the release states.

“We will review the City Manager's report when it is available and we look forward to working with the City and the State as JLAC goes through the audit process.

The city uploaded the CCCIA letter of complaint and related documents to its website in November and added the city’s internal review on Friday.

The documents may be found at  capecoral.gov..

Editor’s note: This story has been updated to include comment received from the Cape Coral Construction Industry Association.