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Tribune turns up heat in stormwater investigation

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Seeks detailed explanation of budget language

The latest request, submitted under provisions of the North Carolina Open Records Act, seeks further explanations and additional details for a total of nine different categories listed in general ledger sheets the city sent the Tribune in response to a similar request originally made on February 12 and repeated on March 3.

“In terms of tracking the Stormwater Department’s income and outlay, the sheets the city sent us raise many more questions than they answer,” said Tribune publisher David Morgan. “Right now we – and anybody else who looks at this – see through a glass darkly. We need clarification if we’re going to be able to show people accurately what their stormwater taxes pay for.”

In a letter dated April 4 and directed to City Records Facilitator Sarah Terwilliger, the Tribune seeks the following details:

• Itemized purchase orders or invoices for all items listed under “Professional Services” totaling $1,098,416.72, paid to McGill and Associates of Asheville and Brown & Caldwell, both engineering firms.

• Purchase orders and invoices for professional services, totaling $215,852.47, rendered by CDM Smith Engineers of Knoxville in connection with the development of RADTIP (the River Arts District Transportation Improvement Program.)

• Details of expenditure for $42,031.38 worth of postage, including $8,000 marked “Postage Escrow.”

• Details for 12 items, totaling $45,011.62, marked “Tipping Fees” relating to landfill use.

• Details of 12 transactions, totaling $138,686.75, described as “Street Cut Utility Charges.”

• Purchase orders and/or invoices for transactions listed under “Machinery and Equipment.”

• Identifying documents for a series of transactions listed as “Principal Payment” and others listed as “Interest Expense,” including payee, collateral, purpose and payoff dates. (Who do they owe money to, and for what?” Morgan asked.)

• Individual purchase orders and individual invoices, by job, for items totaling $5,244.31, listed as “Materials” and headed “Blanket PO for Stormwater”

• Descriptions for each of numerous purchases made by various Stormwater Department employees and captioned “Procurement Card.”

• An item-by-item explanation for each of several entries labeled “asset acquisition,” “Asset Maintenance” and “Transfer of Asset.”

The Tribune’s February 12 request was addressed to Benjamin Farmer, an assistant in the city’s Legal Department, rather than to Dawa Hitch, the city’s Director of Communication and Public Engagement, whose department has previously handled such document  requests. (According to City Clerk Maggie Burleson, all such document requests are now forwarded to the Legal Department for processing.)

But Farmer did not reply, so on February 29 the Tribune telephoned him to inquire as to the status of its request.  An aide said Farmer was available, but the call went to his voice mail. So the Tribune left a message asking him to return the call.  He did not.

Instead, the next day, March 1, the Tribune received a message from Terwilliger, who was later identified by Burleson as Farmer’s superior. Terwilliger said “Staff is working on your February 12th request,” and attached a link to the city’s annual financial report.

The Tribune replied that it already had a copy of the financial report, which is available on the city’s public website, and explained again that it was seeking the most recent available versions of material it had eventually obtained in 2014 (see below).  “As a documents facilitator you [should] be familiar with this report,” the Tribune said.

That was when Terwilliger forwarded the materials that appeared to supply, but only in general terms, the requested information.

The Tribune published a series of articles on the financing of the city’s stormwater operations in 2013-14.  In 2014 an analysis of the information that was eventually supplied by the city – after several weeks’ worth of requests and delays – showed that salaries made up approximately 38% of the stormwater department’s budget. The category titled “Other Direct Expenses” which stormwater department head McCray Coates said “is for things like materials, contracted services, professional services, fleet maintenance, fuel, street cut charges, tipping fees, etc.,” also came to about 38% of the total budget. When construction costs were broken out separately, they averaged about 3%. And the remainder, which historically has ranged between 19 and 21 per cent, was shown as going into a reserve fund, at an average of $660,000 per year.

The 2014 study further revealed that when the itemized expenditure figures, which totaled $13,896,552, were subtracted from $17,622,027 in gross revenue, a balance of $3,725,505, or 21%, was left unaccounted for.

In addition to probing the expenditures listed above, The Tribune is also asking why, according to its latest LGC 203 report, which all North Carolina municipalities file annually with the State, the city currently maintains an investment portfolio amounting to almost $127 million.  Of that amount, $19.4 million consists of “commercial paper, including an investment of nearly $5 million in Coca-Cola stock.

A former Asheville city government employee, who requested anonymity, told the Tribune, “I believe the law precludes the city’s holding common stock as an asset.”

“The income from a portfolio that size comes to several million dollars a year.  Where’s it going?” Morgan asked.  Why isn’t it going to offset some of these infrastructure expenses the taxpayers are having to pay for with a stormwater tax?”

The city refers to its stormwater assessment, which is included in each customer’s bimonthly bill, as a fee, and not a tax.

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