Audit of the “Mayor’s Money”

Despite former-Parkersburg Mayor Bob Newell’s bold letter to city council members last week, a recent audit report draws attention to many instances of misspending, overspending, and financial mismanagement under his administration.

On September 8, the accounting firm Perry & Associates, citing a total of 34 exhibits and dozens of interviews, released a report exposing the details of the spending of what was called “the mayor’s money” – coal severance funds he used at his own discretion for pet projects.

Most of the report focuses on shady spending at the Point Park Marketplace.

The marketplace was a plan hatched by Newell.  In 2013, Newell sold the idea to city council based on its potential as an economic development tool and to control the ownership and use of the prime downtown property. Newell came up with the idea of purchasing the structure located at 113 Ann Street where his son was operating a kids’ inflatables business and renting the facility from James and Rebecca McCutcheon. Additionally, Newell told council he believed the marketplace would be eligible for federal and state grants to provide for its development.

Instead of purchasing the property from the McCutcheons, a trade of property was agreed upon and executed on May 29, 2013. The McCutcheons paid $10,000 to the city and gave over the Ann Street property for real estate located at First and Juliana – a revenue generating parking lot.

On January 28, 2014, City Attorney Joe Santer advised Council that there was a mistake in the deed. In order to “clear it up” council members voted unanimously to transfer the property to the Parkersburg Municipal Building Commission. The deed was never filed with the Wood County Courthouse by the city’s legal team and the building remains under the ownership of the City of Parkersburg.

Perry & Associates talked to a member of the building commission who said he believed the commission served no managerial function for the marketplace. However, Newell claims the building commission was responsible for the marketplace leases.

“Since May 28th, 2013 to the date of this report, the City of Parkersburg West Virginia is the owner on record of the Market property,” said the report by Perry & Associates.  During this time period the City of Parkersburg has expended the following funds on the Market:

Fiscal Year Amount

2012/2013 $9.62

2013/2014 $270,517.77

2014/2015 $102,958.64

Total $373,486.03

When interviewed by the accountants, council members Nancy Wilcox, Mike Reynolds, Roger Brown, J.R. Carpenter and Kim Coram said they had no idea that the City of Parkersburg had expended $373,486.03 on the Market.  Sharon Lynch stated she was sure she was supplied with this information and she would have to look at the financial statements she had received during the period of time being reviewed by Perry & Associates. John Rockhold stated it did not matter, because it was for the “betterment of the city”.  Likewise, former Mayor Newell did not know how much money his administration had expended on the venture. Newell stated current Mayor Jimmy Colombo had asked him the same question recently and he responded to Mayor Colombo ”that it did not matter how much was spent at the Market”.

“When asked if the citizens of Parkersburg deserved an accounting of the funds expended at the Market, the former Mayor stated the expenses could be reconstructed by the Finance Department.  He further stated the Maintenance Department would probably know how much.   When asked if the former Mayor would have supported a special GASB line item for the Market his response was we do not have one for the “City Park Pool do we” and “if the Finance Department wanted one, all they had to do was establish one”.   When asked if the former Mayor knew how much money in labor or wages were expended on the Market, he stated no, it would have been too much work to keep track of those expenses.”

The audit report details how two line items – one labeled “City Hall”, the other “Streets and Highways” – were used to camouflage the mounting expenses of the Point Park Marketplace. Curiously, in most instances, Newell agreed that the funds were mishandled.

Funds paid out of “Street Supplies & Materials” included $14,436 in purchases for the marketplace. Responding to questions about the expenses, “Newell stated that this purchase would not be an appropriate expense for this line item” more than a dozen times for expenditures including electric supplies, advertising from the News and Sentinel, tables and trash cans, paint, health department permits for the Blennerhassett Hotel, a gate, Internet service from Suddenlink, lumber, and a scale.

“When asked why the requisition forms from his office directed the funds to come out of this account for expenditures that he has deemed not appropriate, Former Mayor Newell stated he had stacks of the requisition forms on a regular basis and he should not be expected to remember where the funds were coming from to pay certain bills.”

Then-Acting Finance Director Pam Salvage confirmed that Newell alone approved all the expenses for the Market.

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About Callie Lyons

RCNN Publisher and Editor Callie Lyons is an independent journalist and author living in the Mid Ohio Valley. Her first book, Stain-Resistant, Nonstick, Waterproof and Lethal: The Hidden Dangers of C8, is available at Amazon.com and in hundreds of libraries all over the world. Known as a "warrior for public health", Lyons' environmental investigations have been featured in documentaries, including Good Neighbors - Bad Blood and Toxic Soup, on Swedish National Television and in numbers of television, radio and print media interviews. Her work has appeared on Nova's Whiz Kids and in Mother Jones magazine. More recently, a national audience has come to know her award-winning investigative work through the Environmental Working Group and interviews with leading publications like the Huffington Post. According to Dr. Arlene Blum of UC Berkeley, Lyons' first book provided the inspiration for the Madrid Statement, which documents the scientific consensus regarding the persistence and potential for harm of poly- and perfluoroalkyl substances like PFOA and lays out a roadmap to gather needed information and prevent further harm. In 2006, Lyons received the Associated Press of Ohio Award for Best Business Writer. In 2007, Ohio Citizen Action presented Lyons with the Uncovering the Truth Award for her environmental journalism. In 2015, the Marietta 9-12 Project awarded Lyons the Freedom Pin for her commitment to democracy and free press.
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