Thursday, January 21, 2010

State Agency Slams Carmel for Mispending Taxpayer Money

I've long complained about Carmel, led by Mayor James Brainard, overspending, and misspending, taxpayer money. I guess the State Board of Accounts agrees. From the Indianapolis Star:
A state board has admonished the Carmel Redevelopment Commission for spending more than $700,000 on staff salaries and a grant to a nonprofit group, but the board's opinion carries no penalty.

In a letter to the state, Carmel Mayor Jim Brainard refutes the allegations in the Indiana State Board of Accounts audit filed this month. In the letter, he said the city consulted with law firms Barnes & Thornburg and Wallack Somers & Haas and believes the commission acted correctly.

But the state board says the commission did not have the power under state law to pay eight staff members a total of $153,794 with funds from tax increment finance districts. The commission manages those districts to draw commercial property tax funds to pay for projects such as roadwork and erecting buildings.

The board also ruled the commission didn't have the power to give $550,000 to the Carmel Performing Arts Center Foundation, a nonprofit formed to raise money for and eventually operate the city's unfinished $150 million Regional Performing Arts Center. The first phase of that center, a $118 million concert hall, will open in January 2011.

The Performing Arts Foundation drew scrutiny last year because its first three members were Carmel employees, including the mayor, Community Relations Director Nancy Heck and City Attorney Doug Haney.

Brainard resigned from the nonprofit in August, saying he did not have time for that role.

The foundation board has since added Rosemary Waters, a local arts leader; Rollin M. Dick, former chief financial officer of Conseco; Frank Basile, a retired executive of the Gene B. Glick Co.; Ersal Ozdemir, president and CEO of Indianapolis-based Keystone Construction; Eric Stovall, a principle of the Midwest forensic services practice for Switzerland-based KPMG; and John Thompson, president of Thompson Distribution Co.

Steven Libman, the foundation's executive director, last year said he'd like to start a nationwide search to expand the board to 25 to 30 members.

City Councilman John Accetturo, a former redevelopment commission member, filed an ethics complaint in August over the dual roles of Brainard, Heck and Haney as city employees and foundation board members. In September, the Carmel Ethics Board found the three did not face a conflict of interest as members of the foundation board because they didn't have a personal financial stake in decisions being made.

Brainard appoints the majority of members of the redevelopment commission
Apparently the legal advice Mayor Brainard received from Barnes & Thornburg was not very good and overlooked several legal violations. When are these smaller communities going to learn that just paying inflated legal fees to a politically-connected law firm doesn't mean you're getting good legal advice?

This is actually a much bigger story than what it at first appears to be. It could have major repercussions across the state as far as these redevelopment commissions go.


Diana Vice said...

In my opinion, this same law firm gave lame advice to the Educational Service Centers too related to the the AEPA no bid fiasco. Moral of the story: Overpriced attorneys aren't always the best attorneys.

Had Enough Indy? said...

There should be teeth in these laws.