W.Va. Dept. Allegedly Operates For-Profit Businesses

Ninety days after Kanawha County commissioners unanimously voted to audit the Chesapeake Volunteer Fire Department, they have yet to get so much as a peek at the department's books.

Commissioners have invited fire department officials to discuss the audit at commission meetings, but the department has refused. Now the department has hired an attorney.

The commission has no supervisory authority over the department and cannot force it to comply with the audit.

But Commissioner Dave Hardy said the department has a responsibility to open its books because it receives public grants from the state and county.

The department gets about $20,000 every year from the county's public safety grant program.

"What do they have to hide?" Hardy said. "They've used every stalling tactic known to man."

Hardy became concerned about the department's finances late last year when questions arose concerning a $1,500 unpaid fuel bill owed to the Kanawha Valley Regional Transportation Authority.

Commissioners soon learned the nonprofit department was running three for-profit businesses under its umbrella. Hardy requested the audit to make sure there was a clear distinction between the for-profit businesses and the volunteer fire department.

The department has yet to cooperate with the audit.

"This is an insult to the commission and the taxpaying public," he said. "And it's an insult to the people of Chesapeake.

"We've repeatedly asked them to come in and explain their actions and they refuse to," he said. "They've never given us a reason."

Department officials sent an email to commissioners on March 6 saying they had obtained the services of an attorney and would meet with the county-paid auditor when the attorney could be present, Hardy said.

Charleston attorney Larry Kopelman is now representing the department, Hardy said.

Kopelman would not comment on the situation. Calls to Fire Chief Stephen P. Johnson were not returned.

Hardy said he was eagerly awaiting results of a state Tax Department audit of the department's bingo and raffle proceeds.

The state agency has been auditing records at the fire department for a few weeks, said Tom Moore, director of the Criminal Investigation Division.

"The audit is ongoing," Moore said. "These are very labor-intensive."

Moore said the agency would look at records for the last three years. And although the department has yet to show the county any records, it is cooperating with the state audit, Moore said.

He could not say how long the audit would take, adding that it is determined by the number of records that must be searched.

"But from my past experience, I know this could take awhile," he said.

The final outcome of the audit will be sent to the county commission office, he said.

"We'll pass this information on to the county commission just like we do for every bingo and raffle audit," Moore said.

The volunteer fire department grossed about $4.2 million in revenue from bingo and raffle from the beginning of 2009 to the end of 2010, according to state tax records.

Hardy, who is an attorney and certified public accountant, could not find records concerning bingo and raffle winners. Hardy said he was also concerned about a lack of tax records for contract labor at the department.

"I will never vote to give them another dime until they open their books for the fire department and the businesses," Hardy said.

Contact writer Paul Fallon at [email protected] or 304-348-4817.