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August 28, 2005'Little stuff' totals thousandsRecords show misuse of town credit cardsByRecord-Eagle staff writer TRAVERSE CITY - Two East Bay Township officials used taxpayer-funded credit cards on items ranging from a Soo Locks boat tour, airfare for a relative, campground reservations, a hospital bill and thousands of dollars in restaurant charges. Credit card records obtained by the Record-Eagle also showed township clerk Janice Gee allegedly "double-dipped" by billing the township hundreds of dollars for mileage, then charged gas on the township credit card. "It's been a lack of accountability," said trustee Susan LaRose, who took office in 2004. "No one was really being accountable for anything." A recent audit of East Bay finances led to multiple criminal charges against Gee and revealed an anticipated $150,000 fund balance at the end of 2004 turned out to be a $47,000 deficit. A more thorough audit of township finances is ongoing, but credit card charges and expense checks won't be reviewed because that's just "little stuff," one auditor said. But former township deputy clerk and Gee critic Vivian Olson contends the "little stuff" totals thousands of taxpayer dollars. "All that little stuff has added up, which is why (East Bay) is in this financial mess," said Olson, whom Gee fired last year for alleged disloyalty. Grand Traverse County Prosecutor Alan Schneider said his office isn't ignoring "little stuff" or potential evidence collected against other current and former township personnel. A criminal investigation continues, Schneider said. Some township officials say alleged embezzlement and questionable spending could force them to immediately slash services to stop the financial bleeding. Township credit card bills detail spending by Gee, 59, who awaits trial on seven felony counts for allegedly siphoning more than $19,000 from township coffers through payroll manipulations, and Joseph Bartko, 74, a longtime township supervisor swept out of office by voters a year ago. Bartko hasn't been charged with any crimes. The Record-Eagle reported last week that Bartko spent thousands of taxpayer dollars in recent years on obscure items purchased from a federal surplus warehouse, practices state officials investigated in 2002 and termed "illegal and absolutely prohibited activities." Gee managed the township's payroll, paid the bills and wrote the checks. She also wrote thousands of dollars in checks to herself and her daughter, former township assessor Tammi Simerson, for mileage and expenses. Much of the credit card spending by Gee and Bartko, plus expense reimbursement and mileage checks, weren't presented to the township board for approval, a violation of state law, said township trustee Beth Friend, who with LaRose and Supervisor Glen Lile are newcomers to the township board after winning election in 2004. Auditors are having trouble tracking many expenses because documentation is scarce, officials said. Gee, who remains on the township payroll at an annual salary of $41,995, declined comment. "I'm not guilty and I've got nothing more to say," Gee told the Record-Eagle. Bartko declined to comment, and Simerson, who also hasn't been charged, has not responded to numerous messages left for her by the Record-Eagle. Suspicious spending Olson went to work for Gee in 1997. Throughout the years, her suspicions grew. Bartko's alleged propensity for taking employees to lunch and charging it to the township troubled her, she said. "I started documenting in 2000 to protect myself. I saw so much going wrong," she said. By 2001, Olson supplied documentation of suspicious spending to the Michigan Department of Treasury. The agency in 2002 determined officials used township credit cards for personal charges, bills weren't being submitted to the township board for approval, and Bartko was spending taxpayer dollars on personal items bought from the surplus warehouse. Treasury officials sent the township a letter outlining the problems, but some board members said they never saw the notice. Records show the same buying and spending patterns continued until Lile, Friend and LaRose were elected in 2004. Dinner, travel on taxpayer tabs Bartko rang up $1,419 in charges on the township credit card with 40 visits to local eateries in 2003 and 2004 that could not be linked to township business, according to expense reports obtained by the Record Eagle through the state Freedom of Information Act. Among his meals: a visit to the East Bay Ruby Tuesday's on New Year's Day 2004. Many of his restaurant charges were listed as supervisor or township hall supplies. In the past half-decade, township board members spent tens of thousands of taxpayer dollars to attend conferences in Washington, D.C. Their spouses often accompanied them and were supposed to pay their own way, township Treasurer Debora Watson said. But township documents show otherwise in some instances. East Bay officials attended the National Association of Towns and Township conference in 1999, 2000, 2001, 2003 and 2004. A brochure for the 2005 event lists a total of 3½ hours of educational workshops for its four-day event. In September 2003, Bartko flew with his wife to Washington. The township paid for his wife's $236 airline ticket and $506 in restaurant charges over five days, including one charge of $176 at Cafe Berlin. While in Washington, Gee spent $131.97 at the Center Cafe and $106.30 at Capitol City Brewing Co. In September 2004, after Bartko's primary election defeat, Gee and Bartko drove to Washington. Gee wrote herself and Bartko mileage checks for $660.75 before they left, records show. Gee then put $85 in charges at gas stations on the township credit card. Township taxpayers paid $318 in hotel, restaurant, and gas station bills for Gee's drive to Washington. Taxpayers paid an additional $331 in hotel and restaurant bills during Bartko's drive there and back. Former trustee John Reichert also attended, despite losing in the August primary. He charged the township $459 for his airline tickets. Cost of registration for the four board members was $636, but the township sent a check for $1,120. The extra cost was not itemized. Township records show a check was written to the Hyatt Regency Hotel in July to pay for rooms for Gee, Bartko, Reichert and trustee Dale McAllister. The rooms bill totaled $3,641 for five nights. McAllister canceled and didn't attend. Bartko charged an additional $425 for incidental hotel charges such as parking, phone calls and food. Gee had an additional $291 in incidental hotel charges on her card. Reichert put $46 in charges on Gee's card. While in Washington, Gee racked up another $295 in restaurant charges and Bartko spent $462, including a single meal charge of $134.34. Restaurant and hotel receipts obtained last week by township officials show Gee and Bartko paid for six meals at a time with township funds, although just three board members attended. East Bay taxpayers paid $8,708 for the 2004 trip to Washington, D.C. "It sounds excessive," Friend said. "It doesn't seem to be the most useful type of thing." Mileage reimbursements In 2004, Gee wrote herself checks totaling $2,082 for mileage and election supplies. She wrote checks to her daughter for travel in the amount of $2,012. Six charges at local gas stations totaling $151 appeared on Gee's card. Mileage reimbursements are supposed to cover all costs associated with driving one's own car on company business, including gas. Taking a mileage check and then charging gas on the township credit card is "double-dipping," Watson said. On Oct. 5, 2004, Simerson was given a mileage check for $162 in advance of her trip to Lansing. Gee's township credit card receipts showed a $33 charge at a Marathon gas station in Lansing on Oct. 6. Lile and Friend also question distances cited by Gee in her local mileage records. For example, Gee typically charged 24 miles for the 12-mile round trip from township hall to the Governmental Center in Traverse City. Stops at the post office along the way boost the mileage to 32 miles or 36 miles, based on her records. In 2005, after new township board members began requesting documentation, the distance dropped to 18 miles. When Simerson went to inspect new construction for her job as assessor, she often managed to drive exactly 50 miles, sometimes listing mileage on Sundays, according to her mileage reports. Watson's mileage reimbursement requests for $559 in 2004 weren't documented, either. When new board members requested documentation in 2005, they discovered Watson charged the township to drive to and from work each day. She since reimbursed the township. More trips When Simerson traveled to take assessing classes, Gee often went with her, Watson said. Over four days in September 2001, township credit card receipts show charges of $988 for a Detroit area Holiday Inn, car rental at $450, a gas charge in Detroit for $66, restaurant charges of $157.46, and an advance mileage check issued to Simerson for $103. There are also seven charges for state campground reservations in the amount of $224 on the township credit card that month. For a 2003 trip to Sault Ste. Marie, charges on Gee's township card included $183 for restaurants, $340 for the Holiday Inn, $43 in gas and $557 for a rental car. Mileage reimbursement for that 320-mile round-trip at the IRS rate would be approximately $115, as opposed to the $600 the township paid. Gee told an auditor from the state treasury department that she accompanied her daughter to Sault Ste. Marie in 2001 and paid for campsites and one meal with the township credit card, according to interview notes obtained under the Freedom of Information Act. Gee was not on township business, and the state required her to reimburse the township those charges. The notes show it was the lone trip asked about by the state. Auditors refuse to verify accounts When Gee and Bartko were elected for the first time in 1992, the township had a fund balance of $646,000. Today, auditors can't get accounts to balance and refuse to certify the veracity of the township's accounts. They listed five material weaknesses and 21 reportable problems with the township's bookkeeping. Friend said one study reports 50 percent of material weaknesses discovered in an audit are related to fraud. "I asked the auditor, 'Are you sure, with the material weaknesses that we have, can you tell me definitively that there is no other fraud in 2004?'" Friend said. "She leaned forward and said, 'no.'" See Related Stories: Prosecutor says East Bay probe may widen - August 26, 2005 Former East Bay supervisor likely purchased personal items - August 21, 2005 East Bay Township clerk is back to work - August 21, 2005 More money may be missing in East Bay - August 16, 2005 Lile suggests shutting down East Bay government to fix mess - July 22, 2005 East Bay Township supervisor expects 'real ugly' meeting - July 22, 2005 East Bay assessor to be paid as fate is determined - July 12, 2005 Errors pile up in review of East Bay records - July 10, 2005 Public backs East Bay probe leading to arrest of clerk - June 28, 2005 East Bay Township clerk charged with embezzlement felonies - June 23, 2005 Township officials pushed for audit leading to Gee's arrest - June 23, 2005
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