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Public Notices

April 19, 2014

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Some Customers Of Cross Anchor Utility District Call For Board Members To Resign

Sun Photo by O.J. Early

Cross Anchor Utility District Board member Lynn Foshie, at right, responds to questions from Roger Carter, at far left, surrounding the board’s hiring of Foshie’s engineering firm, W&W Engineering. The exchange occurred during Monday’s meeting of the utility district board.

Originally published: 2014-01-14 11:04:01
Last modified: 2014-01-14 11:16:29
 


BY KRISTEN BUCKLES

STAFF WRITER

Some Cross Anchor Utility District customers called Monday for the district's three-member board to resign following recent allegations of mismanaged funds, missing records and altered minutes by the district's former management.

The recent allegations have not charged the board members themselves with midconduct in the matter.

Roger Carter led the call for the board members' resignations and was among three customers to take the board to task over the recent controversy.

"If you'd like to resign, now's the time," Carter told the board. "[If not], it's up to the customers to proceed and go to the next step."

During the meeting, members gave no indication that they would be willing to resign from their positions.

The board held its regular monthly meeting on Monday at the Greene County Water Office, located on West Andrew Johnson Highway.

Chuckey Utility District also operates out of the building and utilizes many of the same employees.

'QUESTIONABLE PRACTICES'

In October, the two district boards placed four employees on leave when local Certified Public Accountant Mickey Ellis' early audit results revealed "questionable practices by the management."

Employees placed on leave include: former manager Shirley Collins; her husband, Willie; their daughter, Kandie Jennings, who became acting general manager after Shirley Collins retired; and Jennings' husband, Bill.

Ellis has not yet released his final report for Cross Anchor Utility District, but listed 17 findings against Chuckey, most of which cited practices by the districts' former joint management.

Greeneville attorney Ed Kershaw answered questions presented to him in December by board members, among them a question of whether customers could remove current members from office and select new members.

Kershaw told the board that both Chuckey and Cross Anchor's bylaws allow the current board to elect its own members.

If a board vacancy occurs and the members tasked with filling the vacant position are unable to agree on a name, a county official, according to the bylaws, resolves the matter.

State law requires that the county mayor provide final approval of an appointment to the board.

Nothing in the bylaws allows customer input, but the board could vote to change this, Kershaw said.

STATE LAW

Carter, however, came prepared with knowledge that state law provides some provision.

He gave some highlights of the law (T.C.A. 7-82-307), which allows for the appointment of board members of a utility district through a plurality vote of customers.

In a situation where customers desire to remove a board member(s) from office, a customer must file a letter of intent to compile and file a petition with the board and then, within 90 days of the date of notice, must compile a petition containing the names of at least 20 percent of the customers of the utility district.

The board must then review the petition for authenticity.

Customers filing a petition must also file a $350 cash bond to the state for the cost of processing the petition. The state refunds the bond if the Utility Management Review Board determines the member(s) should be removed from office.

State law calls for the review board to review any investigation by the state Comptroller of the Treasury to determine if members "should be removed from office for knowingly or willfully committing misconduct in office ... neglecting to fulfill any duty imposed upon the member by law, or failing to fulfill the commissioner's or commissioners' fiduciary responsibility in the operation or oversight of the district."

Ellis has submitted his preliminary report to the Comptroller of the Treasury, and Kershaw has confirmed to the board that the Comptroller's office is conducting an investigation.

The Comptroller has also contacted the state Attorney General, Kershaw said.

MEMBERS LIABLE?

In Carter's address to the board, he first called on each member to reply to a question: Do you feel liable?

"To some effect, we do, yes," Board President Lloyd Dawson replied. "We hire people and the manager.

"We don't try to micromanage what they do," Dawson added. "That's not our responsibility."

Citing district bylaws, Carter told Dawson that the board is responsible for directing the use of funds and properties.

Board member Charles Baxter declined to comment, but nodded his head in response to the question.

"To a certain point, yeah," board member Lynn Foshie replied. "We see what we're given.

"If you're wanting to do something [wrong], you could easily do something and not give it to the board," he said.

BYLAWS FOLLOWED?

Carter then turned to another question: Was the board treasurer signing all checks and vouchers for the district, as required in the bylaws?

"No," Dawson replied.

"That's what I thought," Carter said. "That's strictly against the bylaws."

Carter said he has spoken with County Mayor Alan Broyles, Kershaw, and state Rep. David Hawk, R-5th, of Greeneville, concerning allowing customers to elect the board members.

OUSTER

Meanwhile, he said customers could turn to the ouster provision in state law, a movement he indicated willingness to lead.

"You're the only customer I hear saying that," Dawson said of the call for the board's resignation.

Carter, however, said such a call has been something he has frequently heard in discussions.

Bill Gass, another customer who spoke at the meeting, agreed.

"You need to get out and talk [to customers]," he said. "That's all I hear, [that] you're just as guilty as they are for not catching it."

"That's fine if they say that; I'm not certain that makes it true," Dawson replied.

Carter and another customer, Kay Swift, also questioned the board on a recent agreement to allow W&W Engineering to provide an inspector on a State Revolving Loan project (Please see related story on page A-1.)

 
For more information and stories, see The Greeneville Sun.

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