TEXARKANA - An investigative report from the state Legislative Joint Auditing Committee details an array of problems, including breaking state laws and local ordinances, in Texarkana’s rush to provide incentives to finance the construction of a privately owned hotel-convention center and water park.
The report covers select financial transactions and business practices from Oct. 30, 2009, to Sept. 23, 2013, and has been forwarded to 8th Judicial District South Prosecuting Attorney Carlton Jones.
State Sen. Jimmy Hickey, R-Texarkana, along with Jones and state Rep. Prissy Hickerson, R-Texarkana, requested the investigative-special report in September. A month earlier, Mayor Wayne Smith called for a review, saying impartial and expert eyes could provide clarity to a situation that was tearing the city in two.
“I have serious concerns about the path the city of Texarkana is on,” Hickey said. “This report has been referred to the prosecuting attorney and, as unfortunate as it is, I feel that our judicial system may have to resolve these issues to bring closure to this situation.”
The summary of the investigative report said the review “revealed inadequately documented construction expenditures totaling $4.14 million, a duplicate reimbursement to the investor of $44,614, and noncompliance with various state laws, as well as city codes, ordinances, policies, and agreements.”
“Several other unusual transactions authorized by the City Manager were noted during the DLA review. These included the City paying significantly more per square foot than the investor paid for real estate, the City committing to make annual contributions and refund all A&P taxes to the hotel and water park for several years, the City waiving building permit fees, and the City reducing water rates for the water park and committing to negotiate for reduced rates in the future. However, there was no indication that the City Manager benefited personally from these transactions, which were approved by the Board and/or (the) A&P Commission,” the report said.
“Finally, the City contributed to the City Manager’s retirement plan at the beginning of the year, before salary was earned,” it said.
In a news conference Wednesday afternoon, City Manager Harold Boldt outlined numerous concerns with the report and said he felt the legislative auditors had not treated him or the city fairly.
“I would say they did their job, but this is not a real audit,” Boldt said. “It’s a review. Now I am going to try to get back to economic development.”
A letter dated Wednesday from Boldt that was attached to the investigative report as Appendix A said: “As you stated in your findings, ‘there was no indication that the City Manager benefited personally from these transactions, which were approved by the Board and/or (the) A&P Commission.’ This goes to show that it was never about me, but the City as a whole.”
Contention related to the issue led to Boldt’s firing in March 2013 and rehiring in October.
Smith was out of town Wednesday but released a prepared statement regarding the report. It said, in part, “This report is not the demise of our city but a tool for us to use to make our community better.”
Arkansas, Pages 12 on 02/28/2014