A three-month police probe into Salt Lake City's business license office found no evidence of criminal conduct, but suggests the office is fraught with poor management practices.

And Salt Lake Mayor Palmer DePaulis is calling for in-house and independent policy reviews of the license office following a police probe of alleged improprieties there.The investigation began in March following complaints of possible criminal misconduct and lax enforcement of penalties for businesses that don't pay license fees on time.

DePaulis, emphasizing the probe found no evidence of criminal conduct, called the incident "a management issue" and downplayed the fact that it happened during his tenure.

The mayor called for an in-house review by Finance Director Lance R. Bateman, who oversees operation of the license office. Bateman said he will recommend a "new management style" for the office.

DePaulis also said his executive assistant and auditor Scott Bond will conduct what the mayor called an "independent review" of procedures in the office.

The police probe, released by the mayor's office Wednesday, focused on business license office supervisor John Katter, who personally received two cash payments from George Owens, the license applicant for Salt Lake Pawn Co.

Owens told internal affairs investigator Lt. Ken Thirsk that in April and June of 1987 he paid $150 in cash toward the $225 balance for his license fee to Katter, who apparently did not deposit the money with the cashier.

Nearly a year later, Owens paid the balance to Katter at the business license office, giving the money directly to the cashier. Katter then took $150 in cash, the amount paid the previous year, from a file folder and gave it to the cashier, the report said.

"At the very least, such practice of collections of city revenue is very poor," Thirsk wrote in the report.

The business license office said Katter was not in his office Thursday morning. He did not return phone calls to his office and could not be reached at home.

The investigation also shows that 11 outstanding debts totaling $6,272 from businesses delinquent in paying license fees since July 1986 cannot be traced through the office's accounting system. Receipts for the same transaction often indicate different businesses paid the debt, the report said.

Additionally, the report said the office poorly enforced licensing ordinance regulations calling for late penalties of up to 50 percent of the license fee. Frequently, three late notices are sent, and no penalties are issued against non-complying businesses, he said.

The report criticized the office for an incoherent accounting system, lack of procedural guidelines and lax enforcement - all of which "invite abuse," Thirsk said.