Bay Council member alleges misuse of funds
By Stacey Cato
Dec 27, 2016, 18:30
Members of the Bay St. Louis City Council have alleged there has been “financial malfeasance” at city hall – an allegation which Mayor Les Fillingame vehemently denies.
In one instance which councilmen say bolster their allegations, records obtained by the Seacoast Echo show a supporting clerical administrative position within the city of Bay St. Louis has recently been eliminated from the city’s current annual budget.
According to city records, the administrative position was once within the city’s fire station but was removed from the fire department's payroll at budget time and added to the police department. It has since been eliminated in its entirety by city council members, in a 5-0 vote, from both department's budgets, but the unnamed employee still apparently works for the city.
“It’s one story after another,” Ward 5 Councilman Joey Boudin said. “It just keeps changing. We just can’t keep dealing with it!”
Boudin said the majority of the council decided to take action by eliminating the position after numerous the mayor to have the employee physically move departments failed and the person was working “outside the budget” by staying within the fire department with supplemented pay from the police department's funds.
Fillingame said last week that he, in fact, did not understand why the position was removed, either.
"That was done after an executive session at the very end of a meeting that I had just left," Fillingame said. "I vetoed that because there was no clear reason why they did it. It suggests at face value that there was possibly even a particular position just targeted to be removed. It was a police department position. In the police department there's no budgetary reason for it, because the police department is running almost 15 percent under-budget right now in the personnel cost.
"They did that in the final budget which, of course, they didn't adopt until September the 29th which was the ultimate very last hour of the opportunity to adopt the budget this year. They typically do it by September 15th, but they kind of held it out until the 29th, and that was really the only position that was significantly changed.
"They need to clarify what their intentions are and what the motivation to do that was, because otherwise, I have no real direction to what they got in the minutes to adjust that. And even if they did, they can eliminate a position but they can't eliminate a person. That's completely up to the mayor in our form of government. Who fills what position. The position right now is up for discussion, the person is not. … That position is still there until they override my veto. I vetoed that action."
“We (the city council) control the purse strings,” Boudin said. “He (the mayor) wouldn’t put them in the appropriate place that we all agreed to put them in, so we defunded the position.”
That move reportedly came amid an investigation into more possible payroll fraud on the city’s books as well as more allegations of misappropriated funds and malfeasance, a city leader said.
Turmoil began heavily brewing after the late Police Chief Mike De Nardo blew the whistle on the misappropriation of Department of Justice Equitable Sharing program funds, also known as the "forfeiture" funds, sparking a detailed series of audits and reviews through local, state and federal agencies, Boudin said.
"Police Chief Mike De Nardo met with a few of the council members to discuss the DOJ funds," Boudin said. "Within 24 hours of that meeting, we had notified the proper authorities of the situation."
That issue has been a continuing point of contention between the mayor and the council, with arguments continuing as late as last week's council meeting. According to the OSA, for a number of years, the city co-mingled the DOJ funds with the general account.
In an internal email that the Echo has obtained, Councilman-at-Large Mike Favre took city attorney Trent Favre to task for his comments in last week's meeting.
"After tossing & turning all night I still sit here in shock & disbelief that you put the blame squarely on the shoulders of the council for misspending the DOJ Forfeiture Funds," the councilman said.
"By stating numerous times on-record that the council approves the docket and spending, you totally put the blame on the council."
Favre point-by-point, explaining why he thinks that's the wrong determination, including allegations that "The mayor signed 5-6 false affidavits stating a certain amount of DOJ funds were accounted for," that "the mayor and his administration Illegally spent federal funds," and that "the mayor and his administration misappropriated federal funds."
"Now the mayor has made statements that he didn't know about the amendments sent in 'til after the fact," Favre continues, "not true. Discussed in meetings. Now the mayor states his signature was forged on those amendments and no investigation on this or nothing said before now?"
Another official responded to the email by saying:
"I disagree with him that we spent the DOJ money, which puts us in a position to refund it from the reserve account. That the citizens benefited some how. We were never told we were using DOJ funds. It never appeared on our docket coming from the DOJ account. … I feel each false affidavit is a crime of perjury.
"The DOJ money was mismanaged and sworn statements were falsified. … I think it would be premature to repay anything until the investigation is completed on malfeasance at city hall."
Fillingame said there were some amended reports sent in to the DOJ, but he thought "the intentions were good," he said.
"Actually, before I was really brought into the conversation about the DOJ funds," Fillingame said, "there were some reactions to the initial awareness of the fact that the funds … had not been spent as they (should have been in accordance with) the guidelines. I think what happened in those amended returns is that (the police department) had gone back and tried to recapture some of those expenses and report them, that really could have very easily qualified for those types of expenses, but (the DOJ) very quickly turned those amended returns back. Dismissed them, basically, because the actual expenses they considered in those amended returns had already been included in the budget. …
"Those amended returns were filled out and sent in electronically and part of that electronic transmission process was to electronically sign the same names that had typically been signed manually on the other reports and I hadn't participated in that but evidently they had just sent it in electronically."
Fillingame said he wasn't quite sure how his electronic signature was forged.
"It was evidently that was something that didn't require a whole lot of personal information for them to click on my information," he said, but "they were dismissed and really not used in the process. I didn't make, really, that big of deal about that. Had it caused the city some issue, I would have made a big issue, but it really didn't."
A final report from the Department of Justice is pending.