Bay St Louis Mayor Les Fillingame vetoes City Council 7-0 vote calling for Department of Justice Investigation

Slabbed New Media has confirmed that Bay St Louis Mayor Les Fillingame has vetoed two recent City Council Actions including a Council resolution seeking a Department of Justice Investigation into the mishandling of several hundreds thousand dollars in Drug Forfeiture funds by the Fillingame Administration. This City Council resolution was passed 7-0 at the August 18, 2015 City Council meeting. Mayor Fillingame also vetoed giving the Clerk of the City Council online viewing access to the City’s main bank account, which passed at a recess meeting of the City Council on September 25, 2015. That City Council action resulted from the culmination of months of wrangling between Mayor Fillingame and the City Council over the Council’s inability to access basic financial records including cash balance information before being asked to vote on matters involving City finances.

The veto represents the latest sparring between the Mayor and City Council that most recently flared up when the City’s audit firm presented the Council with a draft of the 2013-2014 Fiscal Year audit report in August, which by law was due to the Single Audit Clearinghouse on June 30, 2015 and the Office of the Mississippi State Auditor by September 30, 2015. According to sources familiar with the operations of the City, Mayor Fillingame has thus far failed to deliver the City’s Corrective Action plan to the numerous significant deficiencies identified by the audit firm for inclusion in the report. One of the significant deficiencies noted by the audit firm included the City running naked for Workers Comp insurance for 60 days just months after Mayor Fillingame was re-elected in 2013 due to nonpayment of the policy premium. Fillingame had previously steadfastly denied the City was experiencing any financial problems during the campaign.

This continues a pattern of Mayor Fillingame attempting to stonewall bad audit reports as the Municipal FY 2012-2013 audit opinion was disclaimed by the City’s audit firm after Mayor Fillingame failed to deliver a plan to deal with the City’s financial crisis, which has been an ongoing topic for discussion in the City since 2011 despite Fillingame’s repeated denials of same.  In June 2014 Mayor Fillingame finally admitted to the City Council that the City was on the verge of defaulting on an existing water and sewer bond issue due to a lack of funds. This bond issue was then refinanced at a cost to the taxpayers of over $150,000, which averted the default and resulted in a $13/month surcharge being applied across the board to every municipal water customer.

More recently Mayor Fillingame has diverted the $13/month surcharge that was added to utility bills to the City’s operating bank account, despite being dedicated by both loan agreement and council resolution to the payment of the refinanced Water and Sewer bonds. City financial records show only infrequent transfers from the operating bank account to the dedicated debt service fund despite a covenant in the bond debenture requiring the monthly deposit of these funds to the debt service bank account. This debt service funding is currently comingled with Utility, General and Harbor fund cash. Rumors have repeatedly surfaced that accuse Mayor Fillingame of mishandling these dedicated funding sources in an attempt to cover-up the accumulated deficit in the General Fund caused by repeated spending of tax money on non-budgeted items like free Trolley bus service for Ward 2 at a cost of over $70,000 for 6 months of service. Earlier in 2015 it was revealed Mayor Fillingame was providing City a owned dumpster for use by two restaurants in Old Town Bay St Louis. Continue reading “Bay St Louis Mayor Les Fillingame vetoes City Council 7-0 vote calling for Department of Justice Investigation”

Methinks the cycle has turned to spin….

So here I find myself this Saturday working on the day jobs including trying to arrange the massive amount of information I still have to present on the new Jackson County Adult Warehouse Detention Center when off in the distance I heard a sound (ooops wrong sound this one), which is the sound of the local spin cycle starting.

Rest assured I am paying very close attention to this matter. Even better coming soon Slabbed will do something we’ve never done and that is present an actual audit workpaper because the proof lies in the contemporary documentary evidence, not after the fact spin or self-serving backfill.

The Fillingame Administration has made a major mess. The exercise of finding out who is taking ownership of it is quite enlightening.

Bay City Council votes 7-0 to request DOJ OIG Investigation of City Drug Asset Forfeiture Funds

The City of Bay St Louis has been out of the news cycle here at Slabbed for a few months now but here in the dog days of August last night’s meet produced big news on a couple of fronts the main one being this morning’s City Council meeting headline. There has been chatter about the Drug Asset Forfeiture Funds since the last meeting and it was clear from Chief Denardo’s remarks last night regarding the Bay Police Department’s inability to access the funding source to make undercover drug buys there was a problem in finance. The council request asks for a review of the forfeiture accounts from 2008 forward.

Additionally Slabbed has learned this morning from a source with knowledge of City Hall operations requesting anonymity that Mississippi State Auditor’s office investigators have visited City Hall this morning requesting a meeting with Mayor Fillingame, Chief Denardo and City Clerk Smith regarding problems in the Forfeiture Funds. State Auditor’s Office Investigator Susan Syerson was in attendance at last night’s meeting.

Additionally Councilman Lonnie Falgout questioned the amount of cash currently shown on the City’s financial statements for the 2014 Refunding Bond Debt Service Fund indicating his calculations show a shortage of close to $100,000 in the fund. Mayor Fillingame promised to present a reconciliation of the cash in that fund at the next scheduled council meeting.

Finally, what started out as a dust up over how much Bond Vig would be due City Attorney Donald Rafferty turned into a bidding war between Butler Snow and Jones Walker with Continue reading “Bay City Council votes 7-0 to request DOJ OIG Investigation of City Drug Asset Forfeiture Funds”

Special Meeting of the Bay St Louis City Council Called for Tuesday Evening

Slabbed New Media has learned that by call of the City Council, a special meeting will be held in the Council Chambers at approximately 6:30pm Tuesday April 28, 2015, following the Bay Planning and Zoning Board meeting.

The Council has requested the City Clerk be in attendance as the meeting will focus on City finances and the upcoming bonded debt payment.

The public is encouraged to attend.

Transparency again an issue here in Mayberry by the Sea

How does a City Councilperson properly discharge the duties of their office when they can’t get access to basic financial information?

Bay St. Louis City Council spars with clerk over financial records ~ Wes Muller

And as per usual when inquiries are made by the council of the administration they are met with sneers and snark:

Kolf sent out an email Sunday with a single sentence that inflamed tensions even more:

“I’ll get everyone a key to City Hall on Monday,” he wrote.

Whether his statement was meant to be serious, sarcastic or a simple joke is unclear. Kolf could not be reached for comment at his office.

Its ironic folks because this was covered over on Al.com just last week:

Feud over finances: 5 Fairfield City Council members sue the mayor ~ Kent Faulk

It’s nice to see Councilman Reed show Continue reading “Transparency again an issue here in Mayberry by the Sea”

Dumpstergate Part Deux: Still never a dull moment here in the Bay

Let’s tell the story of last night’s Bay City Council meeting via twitter:

Meantime the lack of general fund claims dockets has not gone unnoticed as Poolman pointed out in comments here. For my part I was glad to see Tony Trapani take himself out of the dust-up: Continue reading “Dumpstergate Part Deux: Still never a dull moment here in the Bay”

I’d give a report about last night’s Bay City Council meeting…..

But I could not find a video of a dog with firecrackers going off behind it. With that set up, despite prior assurances the City would be able to pay off the loan the City took last November to pay past due bills, the Administration informed the Council last night the City would need additional time to pay off the remaining balance, pegged by City Clerk Kolf at approximately $200,000.

In other news, proposals to conduct the 2013-2014 fiscal year audit were opened and tabled. Two of the three firms on the State Auditor’s list of approved firms here on the coast submitted proposals. The lack of more proposals means Winner’s curse is not a factor thus the effective hourly rates implied in the pricing are very good (from a CPAs point of view).

Finally if you got an agenda from Miss Jane and did not see advertising for bids for a major construction project or declaring as surplus several pieces of City property it because those items were not on it. Those official actions did make most of the assembled crowd happy though and that gets back to the dog and firecracker thing. The bottom line is do not count on the agendas you get from the Council Clerk in advance of the meeting because they are not worth the paper they are printed upon when it comes to the business the council actually considers.

Finally since I am a turf and grass aficionado:

Here is the weed in question.

Here is what kills it and here is where you can buy it.

Proposed FY 2015 Bay St Louis Utility Fund budget contains personnel cost reductions: An Editorial

Last night the Bay St Louis Mayor and City Council conducted another budget workshop. A full draft of the proposed budget was presented to the City Council and that draft proposed budget contained approximately $180,000 in direct personnel cost reductions in the Utility Fund, Mayor Fillingame told Slabbed after the meeting that the City is committed to removing all but direct Water and Sewer labor from the Enterprise Fund to the General Fund budget. This is an important step forward.

The overall City personnel budget has not been changed but last night’s actions set up a vital and long neglected public discussion. A few weeks ago at the Ward One Town Hall meeting I told the both Mayor Fillingame and Councilman Seal after the meeting that charging General fund salaries directly to the Water and Sewer Fund cheated the public of the very valid discussion regarding the level of City services which the citizenry should be properly paying taxes to support. It is without question both the Council and the Administration now understand the value in having this discussion as people across this town are making their feelings known to their elected officials.

Bay St Louis has the lowest millage rate of any City on the coast but that only tells a part of the story.  One mil is worth over $100,000 to the City and the value of a mil varies across the Coast. That said having lived and pay taxes in three of the six coastal counties I can also say it is undeniable that Hancock County in general and Bay St Louis in particular are the lowest cost locales of the three counties that I am personally familiar.

None of this is to say raising taxes is a foregone conclusion here in the Bay.  That said a discussion about property tax rates to support vital City services is one that the City has long avoided and frankly is long overdue for consideration.  How the Mayor and Council tackle these issues will depend in large part upon what they hear from the public in the Bay.  The Mayor was clear last night that he as well as the City Council are listening to the concerns of the people and that is a very encouraging sign.

Tomorrow night is another budget workshop that is scheduled to begin at 5:30 PM in the City Council Chambers.  I urge the public to attend and make their views known.

Chapter 9 Bankruptcy: A primer for the Citizens of Bay St Louis

The notion that the City of Bay St Louis was experiencing financial problems is not by any means new. Just over a year ago the citizenry heard lots on the topic during the municipal election with Mayor Fillingame unequivocally proclaiming the City was in good shape financially. The irony is by that time, the City was already using its trade vendors as its financier. You see folks, when the bills don’t get paid the trade vendors become an unofficial bank. Even worse, it is the kind of unofficial bank that must make forced loans that bear no interest. It was a sign of things to come in a fools game where the passage of time is the ultimate enemy.

The warning signs were literally everywhere and yet for month after precious month the City Council did nothing. Worse, it appears certain members of the Council were simply going along with the Mayor because it was easy. Last October the City Council, at the request of the administration, finally took action on utility rates to fix the problems the administration identified in the Water and Sewer operations. The increase was targeted at high volume water users which it turns out was the very segment of the City’s customer base that was in decline. Now the Administration claims the rate increase was insufficient.

Last January Slabbed published a detailed analysis of the irresponsible budget practices that lay at the heart of the City’s financial decline. Since then the City has spent money it was legally required to set aside for debt service on municipal operations. Broke, the city made a loan with a local bank that it lacked statutory authority to make.  The proceeds of that loan, mistakenly called “a line of credit” by the Mayor and Council, was split between the water and sewer fund and the general fund. Despite being at every meeting the City Attorney was evidently checked out MIA allowing the Mayor and City Council to step out making what Councilman Lonnie Falgout now terms an illegal loan. I fear it’s gonna take the elected officials here to have to pay big dollars out of their own pockets before they’ll learn the value of operating within the law.

Unable to make the scheduled debt payment on Water and Sewer debt due in July 2014, the City Council again kicked the can, refinancing debt dating from the 1990s that had already previously been refinanced.  The City, caught in a downward financial spiral incurred hundreds of thousands of dollars of debt issuance costs that could have been used to pay for City operations.  From a financial management standpoint, the performance of the City’s elected officials really can’t be much worse. Continue reading “Chapter 9 Bankruptcy: A primer for the Citizens of Bay St Louis”