A bitter feud that began more than a decade ago in West Covina City Hall fueled a searing State Controller’s audit that one former councilman called an affirmation of cronyism and corruption.

Almost five years and two levels of government removed from the city, Assemblyman Roger Hernandez, D-West Covina, is still fighting an old battle. On Friday, he appeared in front of the building where his political career gained traction to condemn his former colleagues and staff for creating atmosphere of fear that led to instances of fiscal mismanagement and underhanded deals.

“I was disturbed, and I was troubled by some of the findings,” said Hernandez, who once called a special meeting that no other council member attended. “Sadly, I was not surprised.”

The State Controller’s Office audit, requested by the current City Council and Hernandez last year, found the city misused taxpayer money, violated state public contracting laws and inappropriately hired former City Manager Chris Chung and other employees.

At the forefront is a 2009 lawsuit brought by Chung against Hernandez and the city that accused the former councilman from 2003 to 2010 of creating hostile work environment that at one point peaked with Hernandez allegedly chasing Chung from the building.

The audit found the city waived its right to recover more than $1 million in legal costs associated with the lawsuit it won at trial in January 2012 when Chung still served as the city’s community development commission director.

Eleven months later, Chung was appointed to the top executive position at City Hall.

“Chris Chung would brag to (other department heads) that even if he lost the lawsuit the City Council would have his back,” Hernandez said.

Hernandez, the odd-man out in a Republican-run council, said Chung was “coerced” to file the lawsuit by the council members Hernandez butted heads with for years, specifically council members Steve Herfert, Michael Touhey and Shelley Sanderson.

The promotion was Chung’s reward, he said.

Chung, who received a $440,000 buyout to retire early in December, vehemently denied any outside influence in his decision to sue the city and Hernandez.

“That’s completely untrue,” he said. “Why would I risk my whole family, my reputation on that? The reality is that I filed the grievance to get him to stop — he wouldn’t stop.”

Chung said he will be sending a letter to the State Controller’s office to ask for corrections to several findings he found incorrect.

Touhey denied any collusion between the council and Chung.

“I already testified on this, my answers are on the record,” he said.

A lawsuit filed against Chung and the city last year by Deborah Dominguez, who oversaw claims against the city, echoed Hernandez’s claims. Dominguez said she faced retaliation from Chung and the council when she spoke out against Chung’s lawsuit against Hernandez. She left the city after claiming she was bullied for nearly two years. “The city must be held accountable for its inexcusable tolerance and approval of City Manager Chris Chung’s outrageous conduct toward Ms. Dominguez, now forced rudely into retirement for speaking out against the city’s cronyism, corruption and gross mismanagement of funds,” the complaint states.

Among the financial misdeeds outlined in the audit, Hernandez pointed to findings that showed city administrators increased a street rehabilitation contract by nearly $1.4 million to include two streets near the home of Councilman Herfert, at his request.

“I think it’s unfortunate that past West Covina management and administration allowed an atmosphere of fear and hostility,” said Shannon Yauchzee, the city’s former public works director and now chief executive officer of Baldwin Park. The audit indicates Yauchzee issued the change to the rehabilitation project, but Yauchzee would not comment on the contract. The council gave final approval to the matter.

State Controller Betty T. Yee’s office considered the increase a violation of California Public Contract Code, but said in a statement that the statute of limitations had expired.

Other dealings included an attempt to sell public property near city hall to a developer looking to build medical offices that a judge later ruled unlawful. That case cost the city $900,000 when the developer later sued.

Touhey, who served on council during the tail-end of the audit’s review period, called the inquiry into the West Covina’s finances a “witch-hunt” orchestrated by Hernandez.

“I believe that there was political pressure put on them by a certain assembly member,” he said. “Roger can blame me, Roger always has.”

He said the audit was “disingenuous” and took issue with the way the state controller’s office handled the city’s responses. He pointed to $32,219 in credit card purchases for expensive meals and hotel stays that auditors called “questionable.” The city provided the justifications for the purchases to the auditors, but the responses were buried in the report, he said.

In response to findings that questioned the City Council’s oversight, Touhey said it wasn’t the council’s fault that it received inaccurate information.

“The budget numbers that were given to us that were not correct were done by city staff,” he said. “There’s not a city council you could find in the state of California who would not rely on the documents we were given.”

During a news conference Friday, Hernandez said he would put pressure on the Los Angeles District Attorney’s Office to pursue criminal charges.

Current City Councilman Mike Spence said he expected his colleagues to also support forwarding the audit to prosecutors.

“There’s elements of people not acting in the city’s best interest,” Spence said, referring to past employees and elected officials. “I think our city employees have a duty to report things that are wrong. … Their fears cost the taxpayers of West Covina money.”