"Sound Off": Do we need an assistant town manager?

On Aug. 4, about 50 protesters marched on Mooresville's town hall, demanding in part the resignation of Assistant Town Manager Erskine Smith.

Some people believe commissioners should have disciplined or fired Smith while he was interim town manager -- not only because of his actions during the Cops for Kids fiasco, but for his role in every major town scandal since 2002.

“Everything this man has touched has been mud,” said one Mooresville resident to Commissioners Chris Carney and Miles Atkins at the town-hall meeting on Wednesday. “In a private industry, he would not have survived five years.”

Smith was interim town manager for seven months, from February to September 2008 -- a period of time, we've come to learn, when he had a tremendous amount of job security. Why? Because even if commissioners would have fired him, Smith would have simply reverted back to being the town's assistant manager. And commissioners have no authority over the assistant town manager position; only a town manager can take disciplinary action against the assistant manager.

In the month from Aug. 4 until Town Manager Steve Husemann came on board Sept. 2 -- and thus Smith reverted back to assistant town manager -- commissioners took no disciplinary action against Smith.

But we learned on Wednesday that at least two commissioners -- Carney and Atkins -- did look into it. What did they learn? "There was nothing we could do," Carney said simply.

After realizing that their hands were tied, Carney said he and Atkins compiled an "extensive report," detailing several years of questionable activity by Smith as assistant and interim town manager. “We’ve placed it in the hands of our (town) manager,” Carney said.

“We might not have any say” regarding Smith's employment, Carney added, “but it was the right thing to do.”

The Town of Mooresville pays Smith almost $106,000 a year. The question was asked on Wednesday: does the town really need an assistant town manager?

Atkins said he ran that question by Husemann, who indicated that the position is valuable because of the manager's workload.

However, Husemann did not have an assistant when he previously managed a town similar in size to Mooresville, said Atkins. Instead, he had "extremely strong department heads" that mitigated the need for an assistant.

Now it's your turn to "sound off." Does the Town of Mooresville need an assistant town manager? Why or why not? How do you feel about the way our assistant town manager handled the Cops for Kids fiasco this summer? Do you believe he should have been disciplined for his role in the matter?

"Sound Off": Are town officials too cozy with developers?

What is the town's position on staff and elected officials fraternizing with, being entertained by, or accepting gifts from developers and other professionals who do business with the town?

That was the question asked "right out of the gate" at Wednesday's town-hall meeting.

Article V Section 7 of the town’s personnel policy states: “An employee of the Town shall not accept any gift, favor, or thing of value that may tend to influence such employee in the discharge of the employee’s duties, or cause the employee to give someone a favor, service, or thing of value.”

Commissioner Chris Carney called the policy “grayer than it should be.”

When it comes to fraternizing with developers or other professionals who do business with the town, Carney said he believes "there's a difference between commissioners and town staff members." Why? Primarily, he said, because commissioners can recuse themselves from voting on matters involving developers with whom they may have friendships or histories.

Carney recalled one issue that he recused himself from because it involved a developer who has gone with him on mission trips. Town staff, he said, can't exactly remove themselves from such a predicament.

Carney said being friendly with developers is one thing - allowing friendships to cloud judgment is another.

“I have business with developers, and I’ve had wine with developers – I’ll be the first to tell you," Carney said. "A glass of wine doesn't buy a vote, and if (it does), that's a bad thing."

Carney said he has also played golf with developers, but that he always pays his own way.

But that wasn’t the case for three town staff members, including Assistant Town Manager Erskine Smith, who played in the 2008 Cops for Kids/DARE golf-tournament fundraiser earlier this year – compliments of a Mooresville engineer.

According to the tournament records, Smith (who was interim town manager at the time), along with a town planner and athletic supervisor, played on a four-man team in the tournament at the town golf course. The fourth player: Mooresville engineer Lee Dowell of Dowell & Company, PC.

Records show that Dowell footed the $200 entry fee for the team, plus an additional $75 to sponsor a hole for the tournament. (Click on the documents for larger versions.)




Without offering specifics, Carney said Wednesday: “There have been some concerns” about town employees not adhering to the policy about gifts and favors. And if there is proof that an employee has violated that policy, Carney said, that employee should be terminated.

“The prior manager (Jamie Justice) did not uphold that, and he’s gone,” Carney said.

Miles Atkins – the only other elected official to attend Wednesday’s meeting – said he has heard Carney point out to Mooresville's new town manager, Steve Husemann, that certain employees' abuse of the town policy "has to stop."

Husemann, said Atkins, is "very much aware of it, and I am confident that he has a handle on that.”

Now it's your turn to sound off. What do you think about the town's policy regarding gifts and favors? Are our town officials too "cozy" with developers/other professionals who do business with the town? And if so, how does that impact you as a taxpayer? What are the benefits of town officials having strong relationships with such professionals? What are the risks? Do you think it's possible for town officials to be friends with developers and other professionals but still hold them accountable?

The Report Spanks Frank Rader, At-Large Commissioner

Commissioner Frank Rader claims he’s the “numbers man.”

Wonder what he’d say the odds are that an elected official could effectively undermine the acting chief of police, interfere with an ongoing criminal investigation and violate the town charter and state law … all at the same time?

Perhaps Commissioner Rader can help us with this equation:

The Town of Mooresville has placed its police chief, John Crone, on paid suspension, pending the results of a criminal investigation by the State Bureau of Investigation into Crone’s handling of his Cops for Kids organization. The town has also launched an internal personnel investigation of Crone as well as external audits of the Cops for Kids fund. Separately, the N.C. Secretary of State is investigating Cops for Kids’ charitable solicitation license, and the jury’s still out on whether the Internal Revenue Service will be looking into why Crone apparently never paid taxes on Cops for Kids income.

Yet beginning the middle of last week, Rader took it upon himself – apparently without the knowledge or consent of fellow commissioners – to make presentations to police officers during staff meetings at the police department.

Despite the fact that the investigations – presumably aimed at explaining irregularities in Crone’s Cops for Kids records and determining whether any criminal activity has occurred – are ongoing, Rader told police personnel that he is inclined to believe Crone’s version of the story (which, as evidenced by Crone’s own interviews with television news stations, has changed as quickly as the wind). Rader also alluded to the officers that they could write letters of support for Crone, as long as the letters are written on personal time, using personal resources. (See “Free Speech or Speech Under Duress?”) He also read excerpts from an anonymous letter that was sent to Crone before the Cops for Kids story broke. Rader also saw fit to distribute a scanned copy of that anonymous letter to members of the media last week. He calls it outrageous. Here it is:


But while Rader felt compelled to distribute the “outrageous” letter to officers and the media, he apparently did not feel compelled to circulate this:


This is a deposit slip showing a $361 deposit made two months ago from the police department evidence room into Crone’s Cops for Kids bank account – a violation of state law and police procedures.

Nor did Rader circulate this:



The first document is Crone’s personal accounting of Cops for Kids finances. It shows that at the end of May, Crone had recorded a balance of $2,830 in a single bank account. The second document is the May 2008 Cops for Kids bank statement. It shows that as of May 22, 2008, while Crone had recorded a balance of $2,830 in the Cops for Kids’ single account, the bank showed that the organization had $20,151 combined in two separate accounts.

Nor is Rader circulating this:


These invoices show that in 2006 and 2007, approximately $1,900 in Cops for Kids money was spent to pay for the police department’s employee Christmas banquet, which is beyond the scope of the narrow Cops for Kids mission that Crone and Erskine Smith are now saying governed the organization.

Is the anonymous letter that was sent to Crone angry? Yes. Does it accuse Crone of illegal and unethical behavior? Absolutely. But you decide which is more outrageous: The letter itself, or the fact that Rader is circulating it while ignoring the evidence that is the basis of the ongoing investigations into Crone and Cops for Kids.

Does the “numbers man” approve of financial records that show different balances? Does the “numbers man” approve of transferring money from the evidence room into a personal slush fund? Does the “numbers man” approve of using many hundreds of dollars earmarked for children to pay for the police department's holiday banquets? Does the “numbers man” approve of cash withdrawals for thousands and thousands of dollars for no documented reason, as regularly occurred from the Cops for Kids accounts? Does the “numbers man” approve of keeping hundreds of dollars in cash in a plastic baggie in a public folder, as was discovered while members of the public reviewed the Cops for Kids records?

Where was the “numbers man” – the commissioner who claims to go through the town budget with a "fine-tooth comb" – when Crone and Interim Town Manager Erskine Smith slipped in a $20,000 transfer of taxpayer dollars to Cops for Kids for the current fiscal year? Even after it was discovered that Cops for Kids was an incorporated entity, Rader continued to champion behind the scenes for the “absorption” of Cops for Kids into the town’s general fund. The problem with that: Incorporated entities cannot be “absorbed” by the government.

Commissioner Chris Carney, responding to Report questions on Monday, said while the investigation is ongoing, the police department “is a place where an elected official does not belong.”

“I would not be doing that,” Carney said, referring to Rader’s presentations to police officers. “That’s why we encouraged investigators to come in. We are not serving as jury in this process. We shouldn’t be even rendering an opinion. We should be encouraging the facts to come out and let them prove guilt or innocence. We should only be making sure our town manager is doing everything to protect the integrity of the process and the confidence of our citizens.”

Carney and Commissioner Miles Atkins agreed that Rader was not acting on behalf of the town board. Atkins said Rader’s presentations at the police department “is all news to me.”

Commissioners Thurman Houston, Mac Herring and Mitch Abraham did not respond.

Mayor Bill Thunberg also did not respond to Report questions. However, he said in a television news broadcast that aired on News 14 Carolina on July 8: “We’ll go where the facts take us.” On behalf of the town board, he said, “In the final analysis, it’s the town manager’s responsibility with regards to personnel and handling those personnel kinds of decisions. It’s our responsibility to be sure the public trust is maintained.”

Rader responded to the Report’s questions on Tuesday morning, stating in an e-mail: “Not available. Response will be delayed until July 28. Vacation. This is form reply. Due to service area send/receive uncertain.”

Town Attorney Steve Gambill said the town charter and state statutes “explain why the Town Board does not get involved with personnel decisions” other than those that affect the town attorney and town manager.

Gambill said Section 5.5 of the town charter and N.C. General Statute 160A-148 define the powers and duties of the town manager and state that the town manager is responsible for the administration of all the town’s affairs.

Rader’s presentations to police officers last week were inappropriate not only because he acted outside of the town charter and state statutes, but because his actions could lead directly to destabilizing the police department by outright undermining what the acting chief of police had specifically instructed his officers to do – and not to do – while the investigations into the suspended police chief are ongoing.

In an e-mail to town administration on July 11, Interim Police Chief Carl Robbins said he had instructed all police personnel “not to comment on Crone’s disciplinary status or the investigations.”

Robbins told the officers “it was their choice if they wanted to contact (Crone).”

During the weekend that followed Robbins’ e-mail to town administration, six officers, all under the same captain, and a civilian staff member wrote letters of support for Crone to the town board. The very day after Robbins acknowledged that the letters were written in violation of the town’s personnel policy since they were written while on duty and using town resources, a defiant Rader – in his “Rader-At-Large” e-mail – reproduced all the letters of support. Yet he failed to acknowledge that they violated policy and the direct orders of the acting police chief.

Robbins had told officers “not to speculate or engage in discussions with the public about the allegations since we need the facts” and added: “We need to give the investigators time to conduct a thorough and impartial investigation.”

Thorough and impartial? Rader didn’t get the memo.

One is left wondering whether Rader would have reproduced letters that are critical of Crone. One must wonder if he suggested to the officers during his “presentations” that they could also write letters in support of the investigations launched by the town that Rader ostensibly represents ... or if the officers would even feel comfortable writing such letters. One must also wonder whose interest Rader is trying to protect: the town’s or the suspended police chief’s?

Perhaps those officers who didn’t write letters in support of Crone or the investigations are the ones who follow the orders of their chief. Perhaps they’re the ones who believe in the integrity of an impartial investigation, untainted by town personnel and officials.

It appears that impartiality and the integrity of the investigations may not be interests shared by Rader, who’s already on the record, casting his lot with a suspended town employee who appears to be guilty of at least poor record-keeping, violating town financial policies, and misleading the public and, at worst, criminal behavior.

Rader calls himself the “numbers man,” but something isn’t adding up.

Cops for Kids: two organizations, two different messages

As we continue to scrutinize Mooresville’s Cops for Kids, we can better understand just how improperly our organization was run by Police Chief John Crone by looking at how a similar organization operates. The comparison speaks volumes.

To disadvantaged children living in and around California’s Lake Elsinore Valley, Santa Claus wears a badge and carries a gun.

About 1,000 children who may have otherwise woken up to no presents under a Christmas tree last year stormed the Diamond minor-league baseball stadium in Lake Elsinore, California, where “the entire third base concourse was full of toys,” said Jason Brown, a member of the Cops for Kids board of directors.

He said that each child was able to choose two new toys that were either donated or purchased from Cops for Kids funds, which are raised by annual fundraisers and contributions from corporate sponsors, businesses and individuals. Santa Claus visited the children at the Stadium, and a local photographer was on hand, snapping complimentary photos of nearly 300 families with the jolly old elf. The sheriff’s department Explorers volunteered at the event, which Brown said ran plentiful of Santa’s favorite snack: cookies.

California’s Cops for Kids Christmas event hasn’t always been held at the Diamond, Brown said. Instead, in past years, Santa’s “sleigh and reindeer” was a caravan of patrol cars from the Lake Elsinore Police Department and Riverside County Sheriff’s Department, delivering Christmas gifts to the area’s disadvantaged children and elderly shut-ins.

But last Christmas, when requests for assistance doubled that of previous years, Cops for Kids had to find a more efficient way to serve the children, Brown said. “It’s a great program we have here,” he added.

The Cops for Kids program in California was created in 1995 by two sheriff’s deputies “who saw a need to help children at Christmas time,” states the Cops for Kids, Inc. website. The officers, while on routine patrol during the holiday season, would hand out gifts to disadvantaged children. (It was this story from the California organization’s website that Mooresville’s Cops for Kids copied, almost verbatim, the alleged story of its founding.)

Thirteen years later, Cops for Kids has grown into a year-round program that assists children, families and senior citizens in need of emergency funding for transportation to school or work, temporary shelters, clothing, and education expenses.

Cops for Kids “works directly with the school districts” for referrals of children to the program, Brown said. The Cops for Kids website includes a referral form, and people “can come in anytime” to the police station to refer someone to the program or request assistance themselves, Brown said.

He said that Cops for Kids – which is a 501(c)(3) – reviews each and every referral, conducts interviews and checks income “to make sure it’s not a bogus request.” The program has one paid employee – its executive director. All other helpers, including the involved officers, volunteer their time.

In addition to helping out with emergency funding and spreading holiday cheer to area children in need, Cops for Kids hosts Bingo games with seniors and holds a Christmas luncheon with those who are living out their days in retirement communities.

This past Christmas, Cops for Kids volunteers, along with sheriff’s deputies, sheriff’s department Explorers and members of a nearby high school choir ,“visited many of the valley’s senior homes,” reads the Cops for Kids website. “We went inside each home, as many as 20 of us brought Christmas gifts and cheer and sang Christmas carols.

“Thanks to the choir members and their awesome teacher … we actually sounded pretty good,” the website quips. “Cops for Kids volunteers and Sheriff's deputies are not necessarily known for their singing voices!”

California’s Cops for Kids has a simple mission: “to ensure all children, regardless of circumstances, are provided the basic necessities that all children should enjoy” and “to provide senior citizen outreach and assistance based on the individual needs of life.” It is a mission the California organization lives up to.

Compare that to the Mooresville Police Department’s Cops for Kids mission. Until a few weeks ago, the overall mission of our Cops for Kids program – as presented on the police department’s website – was verbatim (minus one sentence) that of the California Cops for Kids program. (See http://thegattonreport.blogspot.com/2008/06/cops-for-kids-still-more-questions-than.html). Under the standard used by the California Cops for Kids, the Mooresville version of the organization did virtually nothing in furtherance of the mission that was publicly presented via the Internet as its mission.

When confronted about that, Chief Crone removed the Cops for Kids page from the website and stated that neither he nor his two majors “have knowledge of approving this web page.”

“We are not incorporated, nor have we ever been, nor have we advertised that we are a 501C(3) charity,” Crone stated. “The Mooresville Police did not start their Cops for Kids until 1997 and no one is paid a salary. At one time we looked into applying for a 501C3 designation but we changed our mind and just left it under the police department.”

But if Cops for Kids was never intended to be a charity, what exactly was it supposed to be? What was its mission?

Since 2001, Cops for Kids has spent a majority of its “outreach” funds – raised through individual and business contributions, as well as an annual golf tournament – not to benefit underprivileged children in Mooresville, but to send the Mayor’s Youth Council and the Police Explorers on all-expenses paid trips to New York City; Washington D.C.; Pennsylvania; Pigeon Forge, Tenn. and Atlanta.

Mooresville’s Cops for Kids was supposed to be treating the Police Explorers to a 9-day trip to Las Vegas and the Grand Canyon this month, but according to Interim Police Chief Carl Robbins, that trip has been cancelled.

Crone has called the Cops for Kids trips “educational” and “learning experiences.”

Interim Town Manager Erskine Smith, answering questions on Crone’s behalf recently, said the purpose of Cops for Kids is not to assist underprivileged or disadvantaged children, as presented to the public on the police department’s website, but to “benefit the youth of the community and build relationships between the youth and police department.”

If that’s true, then the message that Cops for Kids is sending to the youth of our community is a troubling one at best: that to be worthy of building a relationship with our police – to be worthy of “benefiting” in our community – one must either be interested in politics (Mayor’s Youth Council) or in law enforcement (Police Explorers).

Such a message contradicts the original stated purpose of Cops for Kids and what our community has been led to believe the program stood for. Of a sampling of contributors contacted recently by the Report, most said that when they donated to this year’s Cops for Kids golf tournament, they thought their money would go to assist underprivileged children in the Mooresville community. And almost every contributor said they planned to write off their donation as a tax deduction because they thought Cops for Kids was a registered charity.

But they can’t write it off, and it isn’t a charity. Instead, Cops for Kids is a fund to send the Mayor’s Youth Council and Police Explorers on trips.

How are those children selected? “There is an application process handled through the high schools” for the Mayor’s Youth Council, said Mayor Bill Thunberg. When asked who makes the final decision of members, he said: “I think the council votes and elects officers too.”

Robbins said the Police Explorers program “is open to both males and females between the ages of 14 and 21” and uses an application process. “Their school work and any disciplinary issues are taken into consideration,” Robbins said, adding that the Explorers group “is limited to 25 active members.”

In California, the Explorers volunteer at Cops for Kids events. In Mooresville, the Explorers – along with the Mayor’s Youth Council – are the beneficiaries of Cops for Kids.

In California, needy children are given brighter Christmases. In Mooresville, politically connected children are given all-expenses-paid, out-of-state vacations with their friends.

In California, police officers volunteer their time to help with Cops for Kids … driving their patrol cars around the community one evening out of the year, for instance, to take gifts to disadvantaged children. In Mooresville, officers and their wives “chaperone” the all-expenses-paid vacations for the Mayor’s Youth Council and the Police Explorers.

The trips aren’t cheap. Cops for Kids spent $3,250 just to charter a bus to take the two groups – consisting of 22 students, including the police chief’s daughter and the former mayor’s granddaughter, along with a whopping 14 chaperones (seven officers and their spouses, including Crone and his wife) – to Washington D.C. for two days last year.

It’s troubling to many people who donated to Cops for Kids that their contributions were used so carelessly. What’s heartbreaking is to consider the number of children in our community who could have and should have benefited from those dollars but weren’t able to because influential families wanted to go on vacation, eat at seafood buffets and attend music concerts, baseball games and amusement parks.

In California, a photographer provides cost-free pictures with Santa to disadvantaged children. In Mooresville, a digital camera captures a group of girls around the “Hershey’s chocolate” characters at the Hershey, PA amusement park.

In California, police officers intervene early with at-risk children who may eventually develop disdain for law enforcement. In Mooresville, our police chief and interim town manager send the message to our youth that the only children worth reaching out to are the very ones whose parents are already connected … the kids who aren’t likely to cause too much “trouble” … and even if they do, the cozy relationships created with the police chief may mean that their misdeeds will go “overlooked.”

That is the message we’re sending to the youth of our community. And as long as that’s the case, we’ll continue to get what we’re asking for.

N.C. Secretary of State investigating Cops for Kids' charitable solicitation license

The N.C. Secretary of State’s Office said today that it is investigating an inquiry into Cops for Kids’ “charitable solicitation license.”

George Jeter, director of communications with the Secretary of State, did not elaborate on details but said the investigation is what triggered the incorporated status of Cops for Kids – which was incorporated as a non-profit entity in 2001 – to be listed on the Secretary of State’s website for the first time ever last week.

According to the Secretary of State’s website, any corporation or entity that solicits charitable contributions must apply for and obtain a license every year. Some organizations are exempt from the license, but it is unclear if Cops for Kids meets the exemption requirements.

Cops for Kids, though it was incoporated in 2001, was not listed on the Secretary of State’s website until Thursday of last week. Before it was listed, Crone said that Cops for Kids was "not incorporated, nor have we ever been."

As it turns out, he was wrong.

Jeter said today that Cops for Kids has in fact been incorporated since 2001 but that it wasn’t listed on the Secretary of State’s website until last week because of a “clerical error.”

He said the investigation into Cops for Kids' charitable solicitation license is what triggered the information showing up on the webpage on Thursday. “On July 2, our CSL (charitable solicitations unit) got an inquiry about this group, and when that investigator accessed the database, she committed it to the website, which meant, bam! It was on the website, we believe, for the first time in seven years,” Jeter said.

“The paperwork was all done in 2001, and there was what appears to have been a clerical error that did not commit it to the website database,” he said, adding, however, that “all the legal paperwork has been here the whole time. We do not believe that it was ever on the website until this month.”

Citing a disclaimer on the Secretary of State’s webpage, Jeter said: “While the website tries to be up-to-date, it’s not the legal version of things."

The Cops for Kids paperwork to secure incorporated status, he said, "was here the whole time, and all the fees were paid.”

Other notes of interest:

• Maj. Carl Robbins has been appointed interim/acting police chief while John Crone is suspended with pay pending the results of investigations into Cops for Kids.
• The town board approved the additional $12.5 million to MI-Connection at yesterday's town board meeting, with Commissioners Miles Atkins and Chris Carney opposing.
  

Police Chief Suspended

The Report has just learned that Police Chief John Crone has been suspended. More details as they become available ...

Town launches investigation and audit of Cops for Kids

After a nearly five-hour long closed session, the Town of Mooresville called for internal and external investigations into its police department's Cops for Kids organization. Additionally, Police Chief John Crone has been removed from "any association" with the organization and is no longer supervising the police department's evidence room.

Mayor Bill Thunberg, reading from a prepared statement after closed session at Monday night's town board meeting, said that Interim Town Manager Erskine Smith has initiated certain steps, “including but not limited to” the following:

· Directed Crone to remove himself from association with Cops for Kids, including any financial transactions;
· Cops for Kids records will continue to be secured at Town Hall;
· The evidence room will be under the sole supervision of Maj. Carl Robbins;
· An external audit of Cops for Kids will be conducted;
· An inventory will be conducted of the police department evidence room “to ensure its integrity is uncompromised”;
· An external investigation by the District Attorney’s office will be requested; and
· The town will launch a “complete internal investigation by an independent, outside party."

Additionally, Thunberg stated, the process will be supervised by Town Finance Director Maia Setzer, and all future questions about the matter will be referred to Town Attorney Steve Gambill.

Crone was not at Monday night's meeting.

More tomorrow …

A Simple Question

In 2002, it was discovered that $4 was missing from the evidence room of the Mooresville Police Department. Almost immediately, the State Bureau of Investigation was called in to investigate, and the evidence custodian was suspended without pay pending the completion of the investigation.

Mooresville Police Chief John Crone was quoted in local newspapers, saying: “We just feel that it’s better to get the SBI in right away. We just want to make sure it’s done by the book.”

The Mooresville Tribune reported that Crone believed that “during the investigation, the employee needs to be suspended to prevent him from carrying out the duties of his position and possibly further breaching the public trust.” The Charlotte Observer reported that Crone believed “it is routine to ask another agency to investigate anytime a police employee is suspected of wrongdoing.”

There is now evidence that Crone improperly transferred $361 in “loose change” from the evidence room to the bank accounts of Cops for Kids, a fund over which he has exercised exclusive control and that has paid for expenditures personally benefiting him.

Just hours before tonight’s town board meeting, we have a simple question: If the absence of $4 from the evidence room justifies calling the SBI and suspending the suspect in the theft, why are the same steps not justified when there is evidence that $361 was wrongly removed from the evidence room?

Listen for an answer -- or non-answer -- to this question at tonight's town board meeting. It starts at 6 p.m. in Town Hall.

Chief spending holiday weekend at PD reviewing Cops for Kids records

One comment posted yesterday asked if Police Chief John Crone and Interim Town Manager Erskine Smith would continue to have access to their offices over the long holiday weekend.

I decided it was worth checking out.

I drove through the Mooresville Police Department parking lot at around 1 p.m. today, and Crone’s patrol car was in fact there.

When he was reached by phone in his office at 1:35 p.m. today and asked why he was in the police department over a holiday weekend, he stated that he was “trying to prepare a presentation for the town board on Cops for Kids.”

When asked if the Cops for Kids records are still at the police department, as opposed to the finance department where they were supposed to be moved after the Tribune and Report completed their review of them on Monday, Crone stated: “Are the Cops for Kids documents here with me? I have copies of most of the documents that you all looked through last week.”

He said that the original documents themselves, however, have been moved to the finance department.

What about the town's $20,000 to Cops for Kids?

What will come of Interim Town Manager Erskine Smith’s recommendation to give Cops for Kids $20,000 from the Town of Mooresville’s general fund in the 2008-09 fiscal year?

Smith recommended the $20,000 line-item expenditure, according to the approved 2008-09 budget. Town Finance Director Maia Setzer said this week that the $20,000 would only be distributed from funds deposited with the town from Cops for Kids.

But Smith told commissioners in an e-mail yesterday that his recommendation at Monday night’s town board meeting will be that the town “not appropriates [sic] any money to COPS for Kids proposed under the current budget,” after all.

Interestingly, Commissioner Miles Atkins three days earlier had said in an e-mail to Smith and fellow commissioners that he would be recommending that very action at the town board meeting: “We need to get to the bottom of this and make sure we get some answers and there is accountability,” Atkins said. “I will be recommending we pull the ($20,000) from the budget and not use taxpayer dollars for CFK (Cops for Kids).”

Smith responded to Atkins and the other commissioners about 10 minutes later. In his e-mail, he did not indicate that he planned to pursue such a recommendation. “You can certainly make that budget amendment as new business in the July agenda,” Smith stated in the e-mail. “Maia can prepare the budget amendment. The CFK revenues and expenditures were being handled by the Police Department. The recommendation this year from the Finance Department was to NOT have the Police manage this anymore. That is why there is a $20,000 revenue and a $20,000 expenditure line item.” But then Smith went on to say: “I’m not sure what the questions are, but having it under the Town’s finance department certainly provides better accountability.”

When asked by the Report to recall specifically when the finance department made the recommendation to "not have the police manage" the Cops for Kids fund any longer – and to produce any memo, e-mail or other supporting documentation that proves it – Smith responded by e-mail: “I’m not sure it was specifically stated by anyone in Finance but likely it was discussed during early Budget talks back in January or February. There is no memo or other written documentation…”

Cops’ charity: Questions, but few answers (Part 1 of 2)

As of May 22, the Mooresville Police Department’s “Cops for Kids” account had a balance of $2,830. Or, it had $20,151. It all depends on which set of records are being reviewed.

On May 13, 2008, there was $361 in cash deposited in the Cops for Kids account. The source: “Loose change from the evidence room.”

And in February 2006, someone who received a Cops for Kids check in the amount of $4,354 tried to cash that check. But it bounced because there was only $726 in the account, according to the Cops for Kids bank records.

Cops for Kids – an organization operated out of the office of Police Chief John Crone that has presented itself to the community as a charity that assists needy children, seniors and families – has functioned under the chief since 1998 without any oversight from the Town of Mooresville or independent financial controls.

Cops for Kids has taken in tens of thousands of dollars over the years from its annual golf tournament and contributions from individuals and area businesses.

But only a small fraction of Cops for Kids money is devoted to expenses seemingly consistent with the organization’s stated purpose, according to a review of the organization’s financial records by the Tribune and the Gatton Report, an independent blog that covers political issues in Mooresville and southern Iredell County.

Crone has been asked to appear before the town board on Monday to answer questions about Cops for Kids and its financial records which, as of this week, were being kept under lock and key in Crone’s office.

The review of Cops for Kids records found that, as of Thursday morning, the organization was never formally organized under state law or federal tax regulations. It also never underwent annual financial audits, never filed taxes, and was controlled exclusively by Crone without oversight by a board of directors or the town’s finance office.

The financial records raise a number of questions. Cops for Kids appears to be operating off of an often-conflicting set of two separate financial statements: One, the monthly statements from the credit union where the organization’s two accounts are held, and the other a balance sheet generated by Crone detailing expenditures and deposits.

The Tribune and the Gatton Report initiated their review of the organization after commissioners voted as part of the 2008-09 budget to absorb Cops for Kids into the town’s general fund. Consequently, as of July 1, the organization is subject to oversight and controls by the finance office.

No oversight or organization

An examination of Cops for Kids has to begin with a simple question: What is it?

That question has proven more difficult to answer than might be expected.

Until Monday, the organization’s Web page – a division of the Mooresville Police Department and the Town of Mooresville’s Web site – said that “with low overhead and virtually no red tape, Cops for Kids can respond immediately to children, seniors, and families in need.”

That Web page, however, was removed Monday afternoon after Crone was questioned about why the text on the site was a verbatim copy of the text on the site of a Lake Elsinore, Calif.-based organization also called Cops for Kids.

“I don’t know how the web page for Cops 4 Kids Inc. got on our website,” he said in an e-mail. “My guess is that someone within the Town Government (possibly even the police department) accidentally thought that our ‘Cops for Kids’ was part of the Cops 4 Kids Inc. The Web page is being removed, and I apologize for the confusion. Neither I or either of my two majors have knowledge of approving this web page.”

According to the North Carolina Secretary of State’s Web site as of Thursday morning, Crone has never incorporated Cops for Kids. Neither has he secured the organization tax exempt status as a 501(c)3, or charity, from the Internal Revenue Service, despite holding an annual fundraiser and regularly accepting thousands of dollars in charitable donations from individuals and businesses.

Crone said in the Monday e-mail that Cops for Kids has never purported to be a charity. “We are not incorporated, nor have we ever been, nor have we advertised that we are a 501C charity,” he said. “At one time we looked into applying for a 501C3 designation but we changed our mind and just left it under the police department.”

Despite appearing to spend at least a portion of its money on charitable causes, as of Thursday morning, Cops for Kids also apparently had no literature about its mission, purpose, successes, or its distribution of money to provide to potential donors or needy families. It also provides no forms that needy families can fill out to request assistance; no board of directors to consult regarding the expenditure of the organization’s acquired funds; and no oversight, save that of Crone, whose name is the only one to appear on the organization’s bank statements.

On Thursday afternoon, Interim Town Manager Erskine Smith and Crone visited the Tribune office and said they had just received Cops for Kids “corporate documents.”

According to Tom Kelley, a professor at the UNC-Chapel Hill School of Law who specializes in non-profit law, "All of this does seem peculiar. Sounds as if they’re not actually a charity."

In contrast, the California-based Cops for Kids includes a host of information and resources, among them: the names of its officers and board of directors; a list of corporate sponsors; annual events; information about how to refer someone in need to the organization; and an application for those who are themselves seeking assistance. It is also listed with the IRS as a charity, registered as a business entity with the state and has filed annual financial reports with the IRS.

Not only has Crone not registered Cops for Kids with the IRS, apparently he has also not filed or paid its taxes. There were no tax filings in the records provided by the chief this week.

Town Hall does not take responsibility for the apparent failure to file and pay taxes. Mooresville’s Director of Finance and Administration, Maia Setzer, said Wednesday that none of Cops for Kids’ expenditures, decisions, or actions have fallen under the town’s purview. Prior to this fiscal year, said Setzer, Cops for Kids was responsible for its own finances and for filing and paying its own taxes.

Spending – on what?

Despite the fact that Cops for Kids has never been formally organized as a charity, it has accepted charitable donations and spent tens of thousands of dollars in such contributions in recent years. Virtually none of the expenses have met the Cops for Kids stated purpose, as described on the Cops for Kids Web page, to assist “children, seniors and families that find themselves in unfortunate situations” and to enable “children and seniors to enjoy some of the basic necessities that were not available to them through other agencies.”

However, two days after the Cops for Kids page was removed from the police department’s Web site, Interim Town Manager Erskine Smith disavowed the organization’s stated purpose. Instead, he said, “Cops for Kids is a program … to benefit the youth of the community that officers are involved in for fundraising and community events.

“The purpose of the Cops for Kids,” Smith added, “was to benefit the youth of the community and build a relationship between the youth and the police department.”

Under that standard, some of the Cops for Kids expenditures over the last eight years seem appropriate. Others are questionable. And still others seem to fall well outside the scope of the broader mission statement.

Among the expenditures that appear to fall within Smith’s mission statement:

• Two receipts from Wal-Mart in December 2004, totaling $429, for Christmas gifts for children on an angel tree. Maj. Carl Robbins, in handwritten notes accompanying the receipts, provided detailed explanations for the purchases, including what was bought and the age of the child for whom the purchases were made.
• Cops for Kids sponsors area softball and baseball teams, provides $100 a year for the non-profit “Basic Fundamentals” basketball camp, and pays $120 a year to sponsor two trophies for the Mooresville High School Blue Devils Marching Band Classic.
• Cops for Kids sinks thousands into its annual golf tournament fundraiser, including paying for the use of the Mooresville Municipal golf course; trophies and prizes; promotional tees and balls; and hamburgers and hotdogs.

Other expenditures could fall within the scope of Smith’s revised mission statement, but there is insufficient documentation to verify that the expenditures were proper:

• $305.39 spent during two trips to Old Navy in December 2001. The receipts do not note whom the clothing purchases benefited.
• In 2002, Cops for Kids paid $213 for four magnetic signs described on an invoice as “Police w/ Race City Logo.”
• Several receipts that lack explanation of the purpose of the purchase, including one to Wal-Mart in December 2003 for $791 for video games and unidentifiable items for unspecified recipients; $200 for candy in October 2003, which was detailed in Crone’s balance sheet as “candy for trip;” and an $353 Wal-Mart receipt in December 2006.

Still others seem to fall well outside even Smith’s broad definition of the Cops for Kids mission. Among them:

• Cops for Kids paid for 70 members of the “Mooresville Youth Advisory” to bowl at George Pappas’ Victory Lanes in September of last year. The total cost: $840.
• A petty cash receipt in September 2001 totaling $179. The explanation: “Petty cash maintained by chief.” The next entry in Crone’s balance sheet is a Sept. 17 withdrawal of $560, with no explanation.
• In 2005, Cops for Kids paid the way for 32 youth – 16 members of the mayor’s youth council and 16 police explorers – and 7 police officers and their spouses to travel to Atlanta. The cost to tour the CNN studio: $288. Cost of lodging: $2,302. Cost to tour the “World of Coca-cola”: $232. A day at Six Flags over Georgia amusement park: $1,419. And the cost to watch the Atlanta Braves play a game of baseball: $1,525. Then in 2007, Cops for Kids took 22 students from the mayor’s youth council and the explorers to Washington, D.C. The chartered bus alone cost $3,150. And in 2008, a weekend-long trip with the mayor’s youth council to New York cost $1,841 for airfare. Lodging for the 16 attendees was $1,233.

A pattern of irregularities

A pattern of irregularities emerges from a review of the Cops for Kids financial records. Perhaps the most glaring is that Crone’s balance sheet indicates that Cops for Kids has only one account, while the bank statements show it has two.

A second irregularity is the frequency with which cash is withdrawn from the Cops for Kids accounts and the handling of that cash without controls in place to track its use.

Cash advances purportedly used on trips funded by Cops for Kids were made on several occasions. These included $3,000 in May 2002, $5,000 in May 2004, $3,000 in June 2005 and $3,000 as recently as April of this year.

Crone’s balance sheet also reflects that, on some occasions, a portion of the money that went unspent on the trips was apparently re-deposited into the account. Due to a lack of full documentation, the exact amount of each of those re-deposits is unclear.

Other substantial cash withdrawals have also been made on several occasions unrelated to Cops for Kids trips. For example, on May 11, 2006, a cash withdrawal of $5,000 was made. On May 17, 2006, a deposit in the amount of $6,983 was made. That deposit was virtually the same as the amount of money collected at the annual golf tournament - $6,960 - and given to Crone on May 17 to deposit, according to Crone’s balance sheet. The $5,000 withdrawn on May 11 therefore remained unaccounted for, as Crone’s balance sheet reflects no cash expenditures from the time of the May 11 withdrawal until the present.

The next deposit was not made until six weeks later when, on June 29, 2006, $2,977 was deposited. Even if this represented a portion of the $5,000 withdrawn in early May – which is impossible to determine from the records because there is no explanation of the June 29 deposit provided - $2,000 of the amount withdrawn on May 11 remains unaccounted for.

Additionally, while the $5,000 withdrawal is recorded in the bank statement, it is not recorded on Crone’s balance sheet.

Other examples of cash being used came later in 2006 and again in 2007. In December of each year, Cops for Kids paid for the Mooresville Police Department’s holiday banquet for department employees.

According to an invoice, in 2006, Cops for Kids paid $1,203 to Tasteful Impressions for a 75-person buffet. Payment was made by a check for $600, supplemented by $663 in cash. The $600 check is recorded in the bank statement for that month and in Crone’s balance sheet, but the $663 in cash is not recorded in Crone’s balance sheet. The cash payment is simply noted on the Tasteful Impressions invoice. There is no indication in any of the records as to where the cash came from.

A similar situation arose in 2007. Cops for Kids once again paid for the annual holiday banquet for the police department. Payment of $683 was made: $500 in a check and $225 in cash. The records don’t explain the discrepancy between the amount due and the amount paid. As in 2006, there is no indication in the records stating where the cash came from.

It appears to be normal operating procedure for Cops for Kids to keep cash on hand. In September 2001, a withdrawal of $179 was made for the purpose of “petty cash maintained by Chief,” according to Crone’s balance sheet. Just days later, a $560 withdrawal was made and recorded on Crone’s balance sheet, with no explanation of what that money was used for.

And, while the Tribune and the Gatton Report were reviewing Cops for Kids financial records at the police department Monday, a plastic baggie containing $492 in cash fell out of a folder marked “misc.” Included in the folder were handwritten notes, none of which explained the cash.

Crone was not on hand during the examination of the records and had said earlier that Smith had instructed him not to answer questions from the media.

There is also the deposit of the loose change from the evidence room. On May 13, 2008, a deposit slip indicates that $361 was deposited into a Cops for Kids account. Noted on the deposit slip was the phrase: “loose change from evidence room.” In the upper left-hand corner of the deposit slip was written the word “Chief.” Although this deposit appears in the bank statement, it does not appear in Crone’s balance sheet.

Another apparent irregularity is that Cops for Kids frequently operates with a negative bank balance, according to Crone’s balance sheet. The balance sheet indicates that from May 2005 to May 2006, Cops for Kids never operated in the black.

During that time, Cops for Kids attempted to pass a check in the amount of $4,354 for which there were insufficient funds. The balance in the Cops for Kids account when the check was presented for payment was $726, according to bank records. There is no indication in the records as to who received the check and why it was not presented again for payment.

Cops for Kids’ bank balance rose into the black for a brief period in May and June of 2006 before reentering negative territory in late June 2006, where it remained until May of 2007, according to Crone’s balance sheet.

Also according to Crone’s balance sheet, the account then briefly rose again into positive territory for the last two weeks of May 2007 before reentering negative territory in early June 2007, where it has remained, as of June 16, 2008.

However, the Cops for Kids bank statements often reflect balances different than those recorded by Crone. For example, he recorded a negative balance as of June 28, 2006 of $426. The bank statements reflect a total of $16,226 in its accounts.

Likewise, Crone recorded a negative balance of $2,711 on June 28, 2007, while the bank statements show a balance of $13,008.

And as of May 22, 2008, Crone had recorded a balance of $2,830 and the bank statements had a balance of $20,151.

What’s next?

Commissioner Mac Herring has asked Crone to appear at Monday night’s town board meeting to discuss Cops for Kids.

“I have no problem funding this effort if it indeed serves the needs of our town as an outreach of the police department; however, I am not sure of what this program is … after reading Chief Crone’s e-mail … where he apologized for the website misinformation,” Herring said in a Monday e-mail to fellow commissioners and town staff. “I had looked at the site some time in the past and assumed it ran pretty much as the charity I had imagined it was.”

Commissioner Chris Carney declined to comment this week but left a voicemail stating that he’s on vacation at the beach. Commissioner Thurman Houston could not be reached for comment.

Mayor Bill Thunberg has not publicly commented. Neither Smith nor Crone has responded to a series of questions seeking clarification on the Cops for Kids organization.

Commissioners Mitch Abraham and Frank Rader withheld judgment on Cops for Kids until they receive more information. “(I) will need to see and hear items before reacting in a rash manner!!” Abraham said in an email to the Tribune.

Added Rader in an e-mail on Tuesday to fellow board members and town administrators: “Please, can we get some facts before we write resolutions and motions?”

Rader was responding in part to an e-mail sent on Monday by Commissioner Miles Atkins to the town board and Interim Town Manager Erskine Smith, stating that he would be recommending that any town funds earmarked for Cops for Kids be removed from the budget.

Included in the 2008-09 fiscal year budget is a $20,000 line item expenditure for Cops for Kids. Town Finance Director Maia Setzer said this week that the $20,000 would only be distributed from funds deposited with the town from Cops for Kids.

Smith, in an e-mail to commissioners on Tuesday, stated that in prior years, “Cops for Kids was run by the police department. Revenues and expenditures were made solely by the Cops for Kids account held by the police chief.”

Atkins responded: “So in essence, Cops for Kids has been a personal slush fund for Chief Crone for all this time with virtually no oversight ... Am I missing something?”

(Be sure to read: Seven years later, Cops for Kids turns up as a registered corporation (Part 2 of 2) )

***

The Mooresville Tribune -- and specifically Reporter Megan Pillow -- helped tremendously with this article. She met me on Monday at the police department and has been pouring over the Cops for Kids financial information alongside me all week. The Tribune will have a copy of this article in today's (July 4) edition.***

Seven years later, Cops for Kids turns up as a registered corporation (Part 2 of 2)

Last week, the N.C. Secretary of State’s web site had no record that Cops for Kids was ever incorporated. As far as the Secretary of State was concerned, Cops for Kids did not exist.

But by Thursday afternoon, several days after questions began to arise about the charity operated by Mooresville Police Chief John Crone, the Secretary of State’s Web site was now reporting that Cops for Kids was incorporated as a non-profit entity in June 2001.

All business entities incorporated or otherwise formally organized under state law are registered with the Secretary of State. The secretary’s web page includes a means by which business entities registered in North Carolina can be searched. Documents available through the web site for each registered entity typically include organizations’ articles of incorporation and annual reports.

On June 27 , Cops for Kids was not among the business entities listed on the Secretary of State’s Web site. Crone himself said in an email to the Gatton Report on June 30 that Cops for Kids was not incorporated and had never secured tax-exempt status as a charity under federal tax regulations. “We are not incorporated, nor have we ever been, nor have we advertised that we are a 501C charity,” Crone wrote in the e-mail. Click on the document below to see a larger version of the scanned June 27 print-out of the search for Cops for Kids on the N.C. Secretary of State's site:

However, Interim Town Manager Erskine Smith alerted town commissioners in an e-mail on Thursday that a search of the N.C. Secretary of State’s web site revealed that Cops for Kids had, in fact, incorporated as a non-profit entity in June 2001. “We have found that the Mooresville Cops for Kids is a non-profit corporation under the State of North Carolina,” he wrote to the commissioners. “It was incorporated by the State on June 29, 2001.”

A review of the Secretary of State’s web site on Thursday afternoon by the Tribune and Gatton Report found an entry for Cops for Kids that is not present on the June 27 print-out of organizations registered with the Secretary of State beginning with the word “cops.” Nor was such an entry present on the secretary’s web site as recently as the early part of this week, as it should have been if the organization had been incorporated in 2001.

On Thursday, however, when a search of all registered entities with “cops” as the first word in their names was conducted, the five organizations present on the June 27 print-out were still present. But so was a sixth entry that was not present on the June 27 list: Cops for Kids, Inc.
The new version of the Secretary of State’s web site states that Cops for Kids incorporated in June 2001, with John Crone as the organization’s registered agent. Here's a scanned copy of the July 3 search results:



While the web site appears to represent that Cops for Kids was incorporated in 2001, the page, as of mid-afternoon on Thursday, did not include any scanned versions of the documents typically available through the secretary of state’s web site, such as the articles of incorporation or the annual corporate reports. The page where such documents would typically be located was simply blank. But, by approximately 3:15 p.m. Thursday, articles of incorporation were posted on the secretary’s web site.

Local attorney Ben S. Thomas is listed on the articles of incorporation as the incorporator of the organization. Thomas said that he was the incorporator of the organization and that he contacted the Secretary of State on Thursday after hearing discussion in the community about the status of Cops for Kids and finding the organization was not listed on the secretary’s web site. “This is the first time in 20 years that I’ve ever seen that,” he said.

Certified articles of incorporation, which are returned to organizations by the secretary of state after incorporation is formalized, were not present in the Cops for Kids files made publicly available this week.

Also, there is no entry in the Cops for Kids’ financial records indicating that the required $60 payment was made to the Secretary of State in 2001 to cover the cost of incorporation. The secretary of state will typically reject articles of incorporation submitted without payment.
Crone could not be reached to explain why, as recently as the early part of this week, there was no record of Cops for Kids on the Secretary of State’s web site, nor why he previously said the organization was not incorporated.

George Jeter, director of communications with the Secretary of State, told the Tribune and Report on Thursday afternoon that he can’t explain why Cops for Kids was not listed earlier this week on the secretary’s web site but showed up later in the week. “It was clearly incorporated in 2001. I had them scan and put in the articles of incorporation. There’s no reason it wouldn’t have been up, not unless there was a ghost in the computer,” Jeter said.

In addition to the status of Cops for Kids as a business entity under state law, town officials are also revising their previous statements about the organization’s tax-exempt status. In an e-mail to the Tribune on Thursday afternoon, Smith stated that Cops for Kids “has not paid any taxes. The Chief has never represented that the organization was a 501(c)3.”

But later in the day, Smith said it was always the intention of Cops for Kids to file for tax-exempt status and that an oversight was responsible for the failure to secure the status. “The counsel for the corporation did not file the required paperwork to the IRS for a tax exempt status. (Chief Crone had signed the application and attached a check payable to the U.S. Treasury for the application fee.)” Smith said in an email.

A copy of the documents was not available by Thursday afternoon.

A search performed Thursday of the Internal Revenue Service’s list of registered 501(c)(3) charities still did not identify Mooresville’s Cops for Kids as a tax-exempt organization.

Be sure to read Part 1 of 2 Cops’ charity: Questions, but few answers (Part 1 of 2)

"They had their say ... now we have ours": Erskine Smith/Town Voice

“They had their say … now we have ours” is a collaborative column that will appear periodically in the Report, offering a critical analysis of a comment made publicly by a government official or employee. If you would like to participate in a collaborative column, send me an e-mail, including the comment (it must have been made publicly) and sound reasoning for why you took issue with it. If it’s something I think we can develop, we’ll work together via e-mail on writing the column. Readers whose viewpoints are eventually printed, as always, have the option of remaining anonymous.

***

“Dissent is the highest form of patriotism”
(Howard Zinn, often attributed to Thomas Jefferson)

After reading the section in May’s Town Voice titled “From the Office of the Town Manager,” I sat in disbelief over what I had just witnessed.

I had witnessed the desperate grasping of a public official (Interim Town Manager Erskine Smith), under fire, attempt to free himself from the watchful eyes of the community by shamelessly using the memory of a remarkable young man to disseminate his frustrations against his detractors.

And I had witnessed the blatant abuse of power by this man when he gave himself permission to use public resources to vent his anger and frustration – for surely the silencing of public dissent is not included in his job description and substantial salary.

In his letter to the citizens of Mooresville, Smith began by recounting the untimely and tragic death of a young man in our community, Griff Lyerly, and by reminding us of the majestic words of Marc McClure, one of Griff’s professors.

Unfortunately for us and for Smith, he did not stop there. He went on to conspicuously transplant these ominous words into an otherwise seemingly loving and compassionate piece: “Many men and women have given of themselves to strengthen, serve and protect Mooresville from forces of negativism, intolerance and doubt.”

Smith failed to expound further on these “forces of negativism, intolerance and doubt,” and he failed to tell us who the “men and women” are who, according to him, are valiantly “protecting” us against such menacing forces.

We can only assume that the “forces of negativism” to which Smith refers include the Report and its many readers and supporters, as well as any local activists and outspoken citizens in our community. This assumption is bolstered by the fact that Smith’s name has appeared in various exposé pieces, the most recent being his involvement in a questionable $237,000 “commission” given to his lifelong friend, Jimmy McKnight.

Smith’s vitriolic, unfortunate and awkwardly placed statement was clearly aimed at those who would dare question him and his actions. And it was specifically designed to attempt to squelch opposition and dissent by local citizens and free him from the firm grasp of scrutiny and accountability.

It stands to reason that Smith would like nothing more than for everyone in this community to remain “positive” and “tolerant” as he goes about his business comfortably and without being scrutinized, questioned and exposed. Unfortunately for him, that scenario is not likely to happen, and his wishful thinking has not materialized since the Pandora’s Box was first opened several years ago.

Perhaps most disturbing is an attempt, however subliminal, by Smith to domesticate and indoctrinate the young minds of our community, falsely insinuating to them that a “good citizen” is a quiet and obedient one, even when faced with public officials behaving in self-interest rather than in the interest of their community.

While from one side of his mouth Smith scolds dissenters, from the other side of his mouth he claims to “encourage all citizens to get involved and make Mooresville a better place.” The caveat, we assume, is that we are only invited to “get involved” if we agree to remain quiet about his and other public officials’ misconduct.

For is Smith not in fact telling us that we can only “better” this community if we remain silent to that which is unjust, unfair and improper? Is he not telling us that for us to be better citizens, we must remain tolerant, for example, of his giving away one-quarter-of-a-million dollars of our tax money to his childhood friend, McKnight? Is he not telling us that doubting and questioning our local government constitute the sinister term “forces of negativism”?

Ironically, held within Professor McClure’s words were these: “But like all societies, there are counter forces within and without that seek to erode what you stand for.” It is ultimately up to us, not up to a public official under fire, to decide what our values are, what we stand for, and what exactly we consider the “counter forces” that threaten those values.

“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

(First Amendment of the U.S. Constitution)

Our forefathers, in the First Amendment of the U.S. Constitution, granted us the right to gather, protest, and question our government when it begins to go awry. There are those of us who believe that the primary duty of a “good citizen” is to be vigilant and expect accountability and honesty from the government and its officials. It is not to stroke the egos of those officials by becoming their yes-men or yes-women. It is not to become blindly loyal and unquestioning, and it is certainly not to allow our silence to be bought with political favors or worse.

At the end of the day, Erskine Smith surrendered to a deeply ingrained sense of self-indulgence and used public funds as well as Griff’s memory to espouse his own brand of good citizenship, one that would conveniently “tolerate” and presumably “trust” government, of which he is a part.

Smith’s soliloquy was a poorly veiled attempt to silence, disparage and discount his dissenters and to stop the tide of exposure that may be coming his way.

But to give the devil his due, he managed to end well with this: “The Athenians were right. Let us leave it better than we found it.”

Unfortunately for Smith, there are many in this community whose idea of leaving it better than they found it may drastically vary from that of his.

Friends don't let friends gouge Mooresville taxpayers

Just like the rest of us, town officials have friends. It's just that some friends come at a higher cost than others.

And at least twice in the past four years, Mooresville taxpayers have foot the hefty bill for certain town officials throwing business to their friends.

Most recently, Jimmy McKnight – owner of Realco Investment Properties, Inc. and a lifelong friend of Interim Town Manager Erskine Smith’s – pocketed a $237,151.50 commission check, courtesy of Mooresville taxpayers, for doing practically nothing.

Last year, Mooresville commissioners directed town management – former Town Manager Jamie Justice and Smith, who was assistant town manager at the time – to hire a realtor to find potential recreation land for the town, particularly on the west side of Interstate 77.

“When the town goes looking for land, the price tends to go up awful fast,” Ward 3 Commissioner Mac Herring told the Report this week. “We decided to hire a third party to pursue negotiations.”

Jimmy McKnight, said Ward 4 Commissioner Chris Carney, was the person chosen by "management staff.”

Around the time McKnight was hired, Carney said he was approached by Statesville attorney David Parker, a friend of Judge Preston Cornelius’s who owned 70 acres on Cornelius Road. “He said he thought Judge Cornelius was open to selling the land to the town for park land and that he (Parker) would help to facilitate that if we wanted him to,” Carney said.

However, “David Parker is involved with the Langtree project (the $800 million Mt. Mourne development), which was undergoing town zoning and other issues at the time,” Carney said.

“Parker knew we had a need for land and thought (the Cornelius Road property) would be something we could use,” Carney said, “but at that time, we could not see him other than as a representative of the Langtree project, and that made it difficult for us to pursue that deal. Because of statutes, we had to be careful of not violating the public’s trust by looking like we were making side deals. That was our fault, not his. He had the best of intentions, and I appreciate it."

But when the town started talking in earnest about purchasing additional park land, Carney mentioned the Cornelius Road property to other town commissioners.

Recalled Herring: “Chris suggested that we take another look at it.”

Meanwhile, however, McKnight was scouting out properties and later took his recommendations to the town board. McKnight presented several pieces of potential park land on Mooresville’s west side, Carney recalled. But the Cornelius Road property wasn’t one of them.

Instead, McKnight proposed parcels of land on Brawley School Road and near the Target shopping center on N.C. 150.

“It’s currently impossible to build on Brawley, and there was one piece on 150 that was decent, but we were nervous about the location with that much traffic in the area,” Carney said, adding that the largest tract of land that McKnight proposed was the Mallard Head Golf Course property on Brawley School Road.

“I asked if there was currently a cemetery there,” Carney said with a chuckle, “because if we bought that land, they’d have to bury me there.

“That just wasn’t feasible,” he said. “We don’t need another golf course; that’s not even something we were entertaining.”

Especially knowing that 70 acres had already been made available to the town by Cornelius, Carney said, “I thought the most appropriate area was Bluefield and Cornelius (roads). There were several large tracts of land still available, and my question to (McKnight), when he brought his recommendations to the board, was whether or not he had looked into those areas.

“(McKnight) said that when he looked at Bluefield, he couldn’t find anybody who was willing to sell,” Carney continued. “My question to him was: ‘How about Cornelius Road? It’s already been offered to us.’

“The conversation ended there,” Carney said. “And the next thing we knew, a contract appeared before us days later on that property … (McKnight) brought us a contract back for Judge Cornelius’s property."

And as a result of that – and because of the wording of the contract that town management had secured with McKnight – the realtor walked away with $237,151.50 in commission. His “earnings” were in addition to the nearly $6 million that the town paid for the property.

And come to find out, said Carney, McKnight went against the direction of the town board by disclosing to potential sellers that he was negotiating the land purchases as a representative of the Town of Mooresville.

Fortunately, despite McKnight’s involvement and disclosure that he represented the Town of Mooresville, Cornelius sold his property to the town for the same price as he had originally offered it.

“At the end of the day,” said Carney, “we would have paid the same price (without McKnight’s involvement), just without the $237,000 commission.”

Recalled Herring: “The impression that I had is that we sort of handed (the land deal) to (McKnight) on a silver platter. It was an easy contract to fulfill, in my opinion. Did he have to do a lot of talking, convincing, etc.? Probably not.”

Did McKnight earn the $237,151.50? “Absolutely not,” said Carney emphatically. “He legally earned it because of the contract between him and staff, but he violated the principle of it which was to bring us land that we weren’t able to find.”

Added Herring: “‘Earned’ is sort of a relative term. The way the contract was worded, it said we would pay him that amount, and we had to play by the rules.” But for the amount of work, Herring said, the commission amount “was sort of excessive.”

Carney said he expected McKnight to charge the town something “for doing the legwork on a contract for land that had already been offered to us.” However, he said, “I was disappointed and certainly angered” that McKnight accepted the entire $237,151.50.

“And I expressed that repeatedly to Mr. Justice in a tone much louder than a normal speaking voice,” Carney added.

Carney said that he questioned whether the town had to pay McKnight. “But (Town Attorney Steve) Gambill did some homework on the contract and felt like we had no wiggle room,” Carney said. “So I then asked for the town to terminate any future contracts with (McKnight). We’ve asked that we do no more business with him.”

At-Large Commissioner Miles Atkins was not yet elected when the town purchased the Cornelius Road property in October 2007.

Responding to Report questions this week about McKnight’s commission on the land transaction, Atkins said: “This is the first I have heard of this, and as you can imagine it is very disturbing news. You can expect that I will seek to learn more about this so there is accountability to the citizens why such waste could or would occur.”

Several sources have confirmed for the Report in recent weeks that McKnight and Erskine Smith are lifelong friends. When they were younger, their fathers owned downtown businesses close to one another, and both families were apparently active members of the ARP church. Additionally, the Report has been told, Jimmy McKnight and Erskine Smith are approximately the same age and attended the same schools.

Smith did not respond to e-mailed Report questions asking about his relationship with McKnight and how much influence he, as the assistant town manager at the time, had on the town management’s decision to hire McKnight. A “read receipt” indicated that Smith opened the e-mail at 8:53 a.m. this morning. He was asked to respond by 2 p.m.

Commissioners Frank Rader, Mitch Abraham and Thurman Houston also did not respond to Report e-mails this week about McKnight’s commission from the purchase of the Cornelius Road property.

When asked if he is aware of Smith and McKnight’s friendship, Carney said, “I just understand that they both grew up together.

“I don’t know why he was hired over other realtors, and I’ve certainly had other realtors ask why they weren’t given the opportunity to pursue such an arrangement with the town,” Carney said. “And honestly, in the beginning when we talked about different realtors, Jimmy McKnight wasn’t a name that the board threw out. None of the commissioners weighed in (on who town management should ultimately hire), but we named five or six realtors that we knew dealt with large tracts of land development."

Justice had been town manager for less than three years when McKnight was hired, meaning he was much less familiar with realtors than Smith, a lifelong Mooresville resident who has been assistant town manager for nearly a decade.

So, why was McKnight hired?

“That’s a town management question; we didn’t hire that guy,” Carney said. “The checks-and-balances system of the board is that we give direction to the town manager, and it’s up to the manager to implement those directions.

“They (Justice and Smith) chose that individual, certainly not us.”

Unfortunately, this isn't the first time town officials have allowed friendships to stand in the way of sound decision-making. In 2004, Commissioner Mitch Abraham and former Commissioner Alice Lee spearheaded the town’s hiring of engineering firm CH2M Hill, despite staunch objections from the town’s engineering and utilities professionals. It was later discovered that Abraham, Lee and a CH2M Hill official (who, as of earlier this year, is no longer employed by the company) are close friends and attend the same church. (For more information, see “Rats Abandoning a Sinking Ship?” March 4.)