The city of Sun Valley has been in behind-the-curtains turmoil for some two years, and publicly since late 2011. However, at the close of 2012, a ray of light is visible at the end of the tunnel.
Since fall 2011, the city has embarked on a winding journey down an expensive rabbit hole of investigations to get to the bottom of allegations of misuse of public funds by city employees.
The price tag for the inquest: at least $561,000 paid directly by the city, plus an unknown sum paid by the city’s insurance carrier.
The result: Blaine County Prosecuting Attorney Jim Thomas stated in a Nov. 21 letter to Mayor Dewayne Briscoe that he will not file criminal charges against any city employees due to insufficient evidence. However, the city has updated its personnel policies and turned-over several of its personnel over the past year.
The events that led to nearly a year’s worth of multiple investigations into City Hall’s closet began on Oct. 5, 2011, when then-Finance Manager and Treasurer Michelle Frostenson told then-Mayor Wayne Willich she had detected problems in the city’s financial affairs. Her complaint triggered a city-initiated investigation conducted late last year by Boise attorney Patricia Ball, an investigative consultant.
Ball conducted her investigation from Nov. 23 to Dec. 20, 2011, at which time she recommended a follow-up examination of the city’s purchase and personnel practices. Ball’s investigation cost just under $29,500. By that time, then-Council President and current Mayor Dewayne Briscoe had edged out Willich in the November 2011 election.
Before the end of 2011, Kirtlan Naylor, an attorney retained to represent the city by the city’s insurance carrier, asked Thomas to initiate a criminal investigation concerning possible misuse of public funds by city employees. Naylor’s request was spurred by Frostenson’s primary allegations, follow-up allegations by then-City Clerk Kelly Ek and the results of Ball’s investigation.
The allegations were directed toward then-City Administrator Sharon Hammer, then-Fire Chief Jeff Carnes, his wife, Building Official Assistant Tina Carnes, and their son Nick Carnes, a paid, on-call firefighter. The allegations included personal use of city-owned vehicles, personal purchases on city gas and credit cards, and time-card padding.
On Jan. 17, Thomas requested assistance from the Idaho Attorney General’s Office to conduct an investigation of the city. In Thomas’ letter to the city, he said he enlisted the help because the county prosecuting attorney is “generally precluded” from conducting his or her own investigation.
Additionally, in April, the city commissioned its own investigation, a forensic audit of the city’s finances for the two years spanning 2009 through 2011. The city hired Boise-based law firm Moffatt, Thomas, Barrett, Rock & Fields to oversee the audit so the city wouldn’t have any contact with the auditors. Moffatt, Thomas then hired accounting firm Hagen, Streiff, Newton & Oshiro (HSNO) to conduct the audit. Briscoe has said it would have been irresponsible for the city not to conduct an outside audit since Ball had recommended that the city do so in her report.
On Aug. 24, HSNO presented a report on the audit’s findings to Briscoe and the City Council in executive session. The city paid just over $121,000 to Moffat, Thomas and just under $163,000 to HSNO. On Aug. 28, Thomas subpoenaed the report and its supporting documents. On Oct. 15, the Attorney General’s Office’s investigation was completed.
Thomas then reviewed the findings of the many investigations until he made his determination in November. Though he will not be filing criminal charges, he did state in his letter that city management was “lax” during Willich’s administration. He said managers demonstrated “apparent conflicts of interest” and a failure to follow stated city policies and procedures that led to a “culture of entitlement” at City Hall. However, since much of the irregular behavior was reportedly approved by Willich, Thomas stated it would be hard to prosecute those who allegedly abused city assets.
Hammer’s contract with the city was terminated Jan. 19. The Carnes family resigned Sept. 21. Frostenson and Ek left the city last summer, following settlement of their respective $84,000 and $72,000 tort claims against the city, paid by the city’s insurance carrier. The two whistleblowers claimed they were retaliated against by city-affiliated personnel for bringing their allegations to the light of day.
Briscoe has said he hopes to leave most of the turmoil behind the city by early 2013. He recommended several new hires to the council in 2012, which the council approved, and has also worked with the council to update the city’s personnel policies to prevent abuse of city resources in the future. Briscoe has also said there is now a “new tone” at City Hall, one of compliance with city regulations.
New blood at City Hall
Following the turnover of several city personnel in 2012, Sun Valley has a whole new starting lineup for 2013.
Susan Robertson will succeed former City Administrator Sharon Hammer—and two interim administrators—in January. She has been the village manager of Fox Point, Wis., since 1995. Mayor Dewayne Briscoe said she’ll be the most qualified city administrator the city has had in several years.
Ray Franco has replaced former Fire Chief Jeff Carnes, though his title remains “interim acting chief.” Briscoe has said he is very pleased with the way Franco is running the department.
Hannah Stauts took over former City Clerk Kelly Ek’s position on Oct. 1. Stauts was elected mayor of Stanley at age 22 in 2005, making her the youngest mayor in Idaho history and the youngest elected female mayor in U.S. history.
Angela Walls succeeded former Finance Manager and Treasurer Michelle Frostenson on Oct. 18. A graduate of Wood River High School, Walls started working for the city as a temporary payroll and payables clerk in early July.
Briscoe has said both Stauts and Walls have been great additions to the city and he is pleased with their performance.
Brennan Rego: brego@mtexpress.com
Investigations conducted in late 2011 and 2012 alleged that some city of Sun Valley policies were not followed and some public funds were misused under the administration of former Mayor Wayne Willich. Photo by Mountain Express
