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Judge declines to hold Stevens County commissioners in contempt amid misspending allegations

UPDATED: Thu., Nov. 21, 2019

Spokane County Superior Court Judge Maryann Moreno presides over a hearing in 2011. On Thursday, she declined a prosecutor’s request to hold the Stevens County commissioners in contempt. The commissioners are accused of misspending more than $121,000 from a public fund dedicated to fighting homelessness. (Dan Pelle / The Spokesman-Review)
Spokane County Superior Court Judge Maryann Moreno presides over a hearing in 2011. On Thursday, she declined a prosecutor’s request to hold the Stevens County commissioners in contempt. The commissioners are accused of misspending more than $121,000 from a public fund dedicated to fighting homelessness. (Dan Pelle / The Spokesman-Review)

A judge on Thursday declined to hold the Stevens County commissioners in contempt for appointing an attorney to represent them at taxpayer expense.

In lawsuits brought by the county prosecutor, the commissioners – Wes McCart, Don Dashiell and Steve Parker – are accused of misspending more than $121,000 from a public fund dedicated to fighting homelessness.

During a May 31 meeting, the commissioners recused themselves one at a time while the seated commissioners passed resolutions, indemnifying each other and authorizing the county to reimburse them for attorney fees.

On Thursday in Spokane County Superior Court, Judge Maryann Moreno denied a request by Stevens County Prosecutor Tim Rasmussen to hold the commissioners in contempt, as well as a second request for a summary judgment against the commissioners.

Rasmussen and his specially appointed deputy prosecutor, George Ahrend, argued that a previous order by Moreno precluded the commissioners from using taxpayer funds for their legal defense.

But Moreno gave the commissioners’ attorneys a chance to argue that a different statute allows them to authorize and receive reimbursements from the county.

The commissioners have argued they were acting within their official capacity when they approved the payments from the county’s homelessness fund. Elements of the case hinge on whether they are treated as individuals or actors of a sovereign government.

The homelessness fund consists of surcharges that people pay when they record documents such as property deeds. It is supposed to pay for services such as shelters and low-income housing programs.

The amount in dispute includes more than $30,000 that went to a couple whose home was damaged by historic flooding last year, and nearly $91,000 awarded to two nonprofits that used it to build a transitional home for people with spinal cord injuries.

Moreno has yet to rule on the legality of those expenditures, though the state auditor’s office determined in February the payments were an “unallowable gift of public funds” and an “unallowable use” of “restricted funds.”

Rasmussen is seeking to hold the commissioners personally liable for the homelessness funds by collecting from their personal finances and their public official bonds – a type of insurance policy that pays governments up to a fixed amount when an official fails to “faithfully perform” his or her duties.

In court Thursday, Ahrend said allowing the commissioners to indemnify themselves against misspending allegations would create a “patently absurd situation.”

“If that were the case, it would always be self-defeating for the local government entity to pursue the gift of public funds,” Ahrend said.

The commissioners’ attorneys, Alison Turnbull and Todd Startzel, argued that the contempt motion was premature because the commissioners have not submitted any legal bills to the county for reimbursement.

Ahrend countered, “What their defense really boils down to is, ‘We’ve assembled all the components to build the bomb. We just haven’t set it off yet. So therefore, we can’t be in contempt.’ ”

Rasmussen said he felt obligated to sue the commissioners to recover funds for Stevens County taxpayers. Turnbull and Startzel called that position hypocritical, noting that Ahrend is billing the county for his services as a special prosecutor.

“Why waste money on a motion like this?” Startzel asked.

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