PROVIDENCE, R.I. (WPRI) -- A newly released audit shows Providence likely overpaid a towing company thousands of dollars for work that didn't comply with a city agreement, but officials found no evidence of fraud, misappropriation or kickback schemes tied to the arrangement.

The Providence City Council last year hired consultant CliftonLarsonAllen LLP, or CLA, to investigate concerns over the city's contract with State Towing Inc. The agreement came under scrutiny after the city paid State Towing nearly a quarter million dollars in fiscal year 2021-2022 compared to just $2,600 to a competing firm that same year.

An internal audit later concluded Providence overpaid State Towing by up to $113,000 for work that didn't comply with its agreement with the city, spurring the council to hire CLA for an independent review. The payments took place during the administration of former Mayor Jorge Elorza.

CLA submitted its report last week, similarly concluding the State Towing agreement violated city purchasing rules, along with finding "evidence of possible waste."

"Waste is defined as the thoughtless or careless expenditure, mismanagement or abuse of resources," CLA consultants wrote. "Waste also includes unnecessary costs resulting from inefficient or ineffective practices, systems or controls."

The consultant said Providence showed "potential favoritism" toward State Towing compared to other companies, even when the business wasn't always the most qualified or well-equipped vendor. CLA also found a mismatch between towing logs and billing to the city of nearly $89,000 that went unchecked.

"Various payments and settlements paid to State Towing were for services beyond what was included in their approved bid award, and exceeded bid amounts submitted to the city," consultants wrote.

Contacted Wednesday, State Towing owner Michael Salvatore deferred all questions to his attorney, Michael Kelly, who told Target 12 the owner and company provided all documents and details requested by the city officials "at all times."

"It should be pointed out that this practice was followed by the city for many, many years," Kelly said in a statement. "As is the theme of the entire report, the city's failure to follow its policies, regulations, and ordinances is the sole cause of this issue concerning the payment to State Towing."

Josh Estrella, spokesperson for Providence Mayor Brett Smiley, said the city received the 38-page report on Tuesday and was still reviewing the findings and recommendations.

The city's relationship with State Towing spans back years and expanded in the mid-2010s when the police department agreed to start steering more work toward the company under former Public Safety Commissioner Steven Paré. The work is called "port tows," which involves the towing of abandoned cars, trailers and other large vehicles.

The former commissioner, who was interviewed as part of the independent review, said they tried putting the port tow work out to bid, "but there were not too many tow companies who wanted it because it was a lot of work and did not make the two companies a lot of money," according to the report.

As a result, Paré told the consultants it seemed State Towing was "the only option, so they received the job of the port tows." But Paré said he never remembered being notified there were discrepancies in invoices and payments, and he argued the entire issue was politicized.

"He believed the real issue of the towing contracts was political divide among the councilmembers," consultants wrote. "In the end, there was poor communication and some arguments between the councilmembers and the city, in addition to poor paperwork and invoices, causing the issues with the city and State Towing."

Kelly said State Towing all port tows were directed by city officials, including Pare, and the company charged "reasonable and fair prices," which were all approved by city officials.

"This report quotes the treasurer, who clearly indicates that the issue of costs of port tows is not about the vendor, it is about the city filing appropriate purchasing regulations," he added.

The consultants also examined how tows had been requested in the past by elected officials, including Councilman James Taylor, whose texts with State Towing's owner came under scrutiny as part of a bid dispute in the past.

A text thread included in the audit shows Taylor put in a request for a problematic camper to be towed out of his ward. At some later date, it appears he sent another text invitation to the owner inviting him to a fundraiser and soliciting a campaign contribution.

Taylor defended his texts, telling the consultants he was told to request tows via text, and that sending letters and text messages is typically how he invites people to his annual political fundraiser.

"Overall, CLA does not see any evidence of wrongdoing by Councilman Taylor and believes the texts ... may have been taken out of context or misrepresented," CLA consultants concluded.

Kelly criticized Taylor, however, suggesting Taylor decided to "go after" Salvatore because his brother -- David Salvatore -- was no longer on the council. David Salvatore served on the council for 12 years before losing a bid for state senate in 2022.

Councilman Taylor's text messages to State Towing and subsequent donation request referenced in the report are also telling," Kelly said. "We believe this says it all in regard to the motivations behind this audit and some of the animus toward State Towing."

Despite the various issues tied to the State Towing agreement, the consultants broadly found no evidence of misappropriations or kickback schemes. But they concluded the problems were caused by the "failure to follow procurement requirements, weak correspondences within, and minimal questions being asked and answered internally."

CLA provided a series of recommendations, including doing a better job vetting potential vendors, requiring supporting documents and establishing a clearer process for city officials and employees to request tows.

The firm also recommended requiring vendors to submit monthly invoices, conducting annual audits and creating a whistleblower hotline for anyone "to submit concerns over potential fraud."

The city last year put out a towing contract through a formal bidding process, inviting all companies to submit proposals for the work. Estrella said the city has awarded the work to three companies, including State Towing, and a final contract is being finalized.