Nevada lawmakers not letting bankrupt fire safe council fiasco go without a fight with feds
The tree removal project in 2011 at Lake Christopher in South Lake Tahoe got caught up the fire safe council money debacle. Photo/LTN file
By Anne Knowles
CARSON CITY — Despite efforts by the Nevada Legislature to press the federal government for money, fire districts, contractors and some homeowners in the Lake Tahoe Basin remain unpaid for $3.4 million in fuels reduction work completed as long ago as 2010.
“It’s been over half a decade. It is absolutely absurd, just unbelievable what’s going on,” Nevada state Sen. James Settelmeyer, R-Minden, said Monday during a meeting of the Legislature’s interim committee that oversees the Tahoe Regional Planning Agency and Marlette Lake Water System.
The fuels reduction work was to be paid for through grants from the U.S. Bureau of Land Management and the U.S. Forest Service administered by the Nevada Fire Safe Council.
But starting in 2010 the NVSFC became slow to pay contractors and the U.S. Department of Agriculture’s Office of Inspector General investigated the group after receiving a tip in July 2011. Lake Tahoe News broke the story that summer.
The OIG released a report in January 2012 saying it found that the NVFSC inappropriately deposited money from multiple grants into a single bank account and recommended that all funds be frozen until NVSFC performed audits and demonstrated it was acting properly.
Eventually, NVSFC filed for bankruptcy and its case remains mired in the courts.
Michael Brown, fire chief for the North Lake Tahoe Fire District, testified at the Nov. 30 committee meeting saying that the fire chiefs of the Lake Tahoe Basin conducted their own investigation and found that NVSFC had used USFS money to pay for BLM-funded projects.
“No criminal activity was ever uncovered by the audits and investigations. They co-mingled the funds and paid out with grants that should have been paid out with other grants,” Brown told the committee.
The fire districts and the money owed each include Lake Valley Fire Protection District, $248,759; Meeks Bay Fire Protection District, $403,378; North Lake Tahoe Fire Protection District, $635,118; North Tahoe Fire Protection District, $379,666; and Tahoe Douglas Fire Protection District, $386,440.
More than a dozen contractors are owed, most for between $10,000 and $20,000 and one, Kimball Tree Service of South Lake Tahoe, for $100,015.
“We’ll survive,” said Brown, referring to the fire districts. “It’s the contractors not surviving. I got two calls just last week asking about the payments. One is out of business and the other is just hanging on.”
Still, the fire districts have suffered, too. Brown told Lake Tahoe News that while his firefighting and emergency response team is holding steady at 52 employees, he has had to reduce his fuels reduction team from 60 workers to 36.
During this year’s legislative session, the Nevada Legislature passed Assembly Joint Resolution 3, urging Congress to facilitate the release of the money.
The committee passed a motion Monday to send a letter to the state’s congressional delegation to update the interim committee on the funds.
“I support the letter,” Assemblywoman Robin Titus, R-Wellington, said. “But I am concerned sending letters is an exercise in futility.”
Not paying the fire districts, contractors and homeowners for fuels reduction work completed as long ago as 2010 is disgraceful. Congress absolutely needs to release the funds and pay those agencies, businesses, and individuals for the services they performed.
4-mer, I am one of the contractors tied up in this BK. NVFSC owes me over $9,000.00. Since you don’t respect me as a person nor a military officer do you think I should be paid as a contractor who got ripped off by his own government.
By the way, I was one of the original contractors who has forced the issue and have been in contact with all parties involved. I have given all invoices to the USDA auditors and BK Court Law Firm in Reno. Douglas Fire district has been instrumental in moving this forward as has Ann Grant. The main difference with the Fire departments is they still got paid their salary and benefits while as contractors we paid our employees, overhead and lost our income. By the time we get paid any profit I might have made will be eaten up by the interest rate from the loans I had to take to pay my costs. A contractor from off the hill and myself were the first “whistleblowers” and there was nothing anonymous about it. I put my name on everything.
It was total; mismanagement of the fire safe council by the fire chiefs that caused the problem.
We’ll never know why those fire chiefs did what they did, and I totally understand why the funds were frozen,,,,
I do not understand why it has taken so long to get this done….I would almost bet that the fire depts are trying to stall it for their own reasons. Maybe sweetheart deals with contractors etc that nobody wants to see hit the paper???
It is not uncommon for cheats to hide behind bankruptcy actions. Not only that but the fire chiefs doing their own investigation and finding nothing wrong looks suspicious to me.
Kenny might need to pick his clients a little more carefully in the future.
Where are California reps like the esteemed lifer-politician, McClintock? The smallest players always lose in bankruptcy- by design. I do wonder how any agency of the fed gov’t can do this. If the country isn’t bankrupt then it’s entities shouldn’t get to be.
Mr. Curtzwiler:
I knew that you were one of the numerous unpaid agencies/contractors as you either wrote about this matter in the past or discussed this at a City Council meeting—I don’t recall which. My personal opinion of an individual has no bearing on whether someone (or a group) should be paid for services they rendered; if someone performed a contracted service as per an agreement they legally deserve to be paid for that. This was a legal agreement made with numerous agencies/contractors and it needs to be made right and to be resolved. I also consider ethics, integrity, humility, and maturity to be of importance.
Fire Chiefs had nothing to do with it. If anything they were very helpful in trying to solve the problem. The problem was with the Nevada Fire Safe Council and the person in charge of the funding and disbursement of funds. Robbing Peter to pay Paul is not a very good business platform. This problem falls squarely on the shoulders of one person and one person only. Everyone else involved has been nothing but helpful during the entire course of this fiasco. We did not pick the clients they picked us and we were supposed to get reimbursed the total amount of the job. The client sent 50% of the money to the NVFSC and they were supposed to pay us 100%. The NVFSC cashed the checks and failed to pay us. Rather than the Govt pay us they chose to file Bk.
Mr.Curtzwiler’s last post coincides with what I know to be the case. . .it is worthwhile to note the use of ‘commingling’ in this article, as that has not been a legal issue for decades, (it’s not illegal) but accounting for where the money actually went is, and no one has said anything about that as yet. . .if amounts were compiled from actual creditors against amounts drawn from that account, then more than likely criminality is suggested. . .mere sloppiness is not to be a reasonable answer. . .
Mr. Curtzwiler:
Your reference to one person being in charge of the funding and disbursements is a huge problem with many small non-profits that don’t have the financial wherewithal to segregate those duties for control purposes. Boards of Directors need to be extremely proactive in their oversight and their participation to ensure that financial matters are properly handled, and in many rural areas like Tahoe that doesn’t always occur. For this to happen as you’ve indicated suggests that the NVFSC Board either didn’t know or they didn’t care to exercise proper oversight which was their fiduciary responsibility. The NVFSC Board should be held accountable in this instance.
4-mer, Correct on all accounts.
So why have not the Board and the “person in charge” been brought up on charges? Are they big men in town or how do they run this charade without some official scrutiny, Where is the DA when you need him?