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Prosecutor says Stevens County commissioners ejected from office after lawsuit finds they misspent money for the homeless

UPDATED: Mon., Aug. 24, 2020

The Stevens County Courthouse in Colville is seen in January 2019.  (Tyler Tjomsland / The Spokesman-Review)
The Stevens County Courthouse in Colville is seen in January 2019. (Tyler Tjomsland / The Spokesman-Review)

The Stevens County prosecutor says a judge’s ruling has effectively ousted all three county commissioners from office after the prosecutor sued them for misspending about $130,000 from a public fund dedicated to fighting homelessness.

The commissioners’ attorney, meanwhile, disputes that they must be ejected from office and says the prosecutor has threatened to have the commissioners arrested if they continue showing up for work.

The dispute left county residents wondering over the weekend whether they had a legitimate governing board. It also cast a cloud of uncertainty over the upcoming general election, which has two contested Stevens County commissioner races on the ballot.

Between 2015 and 2018, Commissioners Steve Parker, Wes McCart and Don Dashiell gave the homelessness funds to a couple whose home was damaged by flooding and two nonprofit organizations that built a transitional home for people with spinal cord injuries. In early 2019, shortly before Stevens County Prosecutor Tim Rasmussen filed suit, the state auditor’s office deemed $121,000 of those expenditures “unallowable gifts” of public funds.

The summary judgment order issued Wednesday by Spokane County Superior Court Judge Maryann Moreno says the commissioners and the companies that provided their public official bonds are liable for $130,326 in misspent homelessness funds. Public official bonds are a type of insurance policy that pays governments up to a fixed amount when an official fails to “faithfully perform” his or her duties.

That, according to Rasmussen, triggers a section of state law that says, “Every elective office shall become vacant … whenever a judgment shall be obtained against that incumbent for breach of the condition of his or her official bond.”

Rasmussen said Moreno’s order took effect immediately when it was filed Thursday morning, and the commissioners would be committing a gross misdemeanor if they attempt to carry out any official duties.

“This is not a happy day for the county, but it is a good day for justice,” Rasmussen said in an email. “It is a day when the people can be reassured that laws will be enforced and that people will be held accountable for their conduct, no matter who they are or what position they hold. It is a day that proves that no one is above the law.”

If the ruling forces the commissioners to leave office, it would mark the first time elected officials in Washington have been deemed ineligible to serve under that statute since 1939, when Whatcom County commissioners were ousted for illegally selling two county-owned rock crushers to a private citizen. The Washington Supreme Court upheld that decision in 1940, saying the commissioners’ ouster should take effect immediately, regardless of any pending legal appeal.

On Friday, however, the commissioners’ attorney, Alison Turnbull, wrote a letter saying “an order determining liability is not a judgment,” meaning the statute Rasmussen cited does not apply. She said the commissioners were entitled to continue serving in their positions and accused Rasmussen of an ulterior motive.

“This case has shown that Prosecutor Rasmussen is pursuing a personal vendetta and not interested in justice or the interests of the people of Stevens County. Prosecutor Rasmussen is using the threat of criminal prosecution to forward this agenda, and doing so when the law clearly does not allow him to do so,” Turnbull wrote. “It is clear that Prosecutor Rasmussen’s goal is to subvert the will of the voters and remove the duly elected commissioners by using this bond action instead of a recall petition that is specifically designed to remove public officers from office.”

Stevens County’s homelessness fund consists of surcharges that people pay when they record documents such as property deeds. State law requires counties to collect those fees and maintain homelessness funds to pay for services such as shelters and low-income housing programs. Use of those funds is restricted by state law and each county’s 10-year homelessness plan.

In a public meeting in August 2018, the commissioners approved a payment of about $30,000 to reimburse Joseph and Alena Boharski for the cost of moving their house onto a new foundation on their property near the Canadian border. A few months earlier, the Kettle River had overflowed with rain and snowmelt, eroding the shoreline and damaging their home.

Rasmussen first raised questions about that payment in September 2018 during a contentious local election season, asking the state auditor’s office and the Washington State Patrol to investigate.

The commissioners argued the Boharskis were at risk of becoming homeless because the flooding made their house unsafe to occupy and they did not have insurance for such an event. The auditors, however, agreed with Rasmussen that the payment was improper.

Depositions revealed Joseph Boharski made generous wages as a union pipefitter and the couple had equity in their home as well as savings accounts. For reasons that weren’t immediately clear, Parker approached the Boharskis and offered money from the homelessness fund without being asked for assistance, according to a motion for summary judgment written by attorney George Ahrend, whom Rasmussen hired as a special prosecutor for the case.

Ahrend wrote that the commissioners “did not review the assets and liabilities of the Boharskis, nor did they do anything to determine whether they had sufficient resources to complete the moving and other repairs to their house without county funds,” nor did they ask whether the Boharskis had other living arrangements available to them.

“While the Boharskis could not live in their house until after it was moved and the damage was repaired, they were not homeless,” Ahrend wrote. “They chose to remain on the property while repairs were completed, rather than renting a house or apartment in town. They did not ask the county for money, nor is there any evidence that they could not afford to move the house themselves. The money they received from the county was primarily for their benefit, and since their house had already been moved when they received it, they were free to spend the money however they wanted.”

Other payments totaling $100,000 went to the Colville affiliate of Habitat for Humanity and another nonprofit, Casey McKern’s Pay It Forward, named for a Kettle Falls man who was left paralyzed below the neck after a diving accident in 2008.

According to Rasmussen’s lawsuits, the two organizations used the money to build a house described as a “bed-and-breakfast/layover/vacation house” for people with spinal cord injuries, and the commissioners “did not require the funds to be used to reduce homelessness in Stevens County.”

In the middle of the building process, Habitat for Humanity “withdrew from the project for multiple reasons, including excessive expenditures by the (Pay It Forward) Foundation and breaches of the parties’ agreement,” the lawsuits state.

“Without denigrating the charitable organizations that built the house or Casey McKern, the quadriplegic young man who lives there, the house is primarily for his private benefit. The foundation that owns the (house) cannot be considered homeless, and Mr. McKern was not homeless when the (house) was built,” Ahrend wrote.

“More importantly, there is no agreement with the county or any other mechanism to ensure that the (house) is actually used to reduce or prevent homelessness,” Ahrend wrote. “The foundation that owns the (house) intends to gift it Mr. McKern and remains free to make any other disposition of the property that it desires. Homelessness in Stevens County has not been reduced, and the county has received nothing in return for the money it spent.”

Ahrend wrote that the commissioners characterized payments to the Pay It Forward Foundation as reimbursements for construction work already completed. But the foundation president, Dennis Brasfield, said in a deposition “they cut us a check for 50 grand, and we, after the fact, showed how we were spending the money.”

Travelers Insurance and the United States Fire Insurance Co. issued five public official bonds for the commissioners, each valued at $20,000. Those bonds would not have covered the full amount in dispute, so Rasmussen sought to recoup the difference from the commissioners’ personal finances.

Moreno granted Rasmussen’s motion for summary judgment, holding the commissioners and the bonding agencies liable for $130,000, even after the commissioners reimbursed the county for that full amount in July.

Turnbull wrote that the commissioners “in good faith believed” the expenditures were “valid uses” of the homelessness fund.

“The commissioners never personally benefited from any of these decisions and had no personal connection with the individuals who received the funds,” she wrote. “Prosecutor Rasmussen seized on these decisions to persecute the commissioners at the expense of the people of Stevens County. Through legal gymnastics and favorable rulings on novel applications of law, Prosecutor Rasmussen has been empowered with the ability to use a civil suit to remove the commissioners.”

During an unusual meeting in May 2019, the commissioners recused themselves one at a time while the seated commissioners passed resolutions, indemnifying each other and authorizing the county to pay for their legal defense. Moreno later declined a request from Rasmussen to hold the commissioners in contempt, though she did rule they weren’t entitled to an attorney at taxpayer expense.

Another hearing was being scheduled to determine how much the commissioners and the bonding agencies owe in interest and legal fees.

Asked whether he and the commissioners would show up to work on Monday, McCart replied in an email: “Not sure.”

Dashiell, in a legal declaration, said he learned Rasmussen had advised Stevens County Sheriff Brad Manke to arrest the commissioners if they tried to continue serving last week. Manke didn’t return a message seeking comment Friday, but Dashiell said Manke indicated he would not make an arrest without a court order.

It was also unclear how and when the next commissioners might take office if there are sudden vacancies on the board.

McCart and Parker were first elected in 2012, and their terms were expected to end on Dec. 31. Dashiell, who was first elected in 2010, was expected to serve through 2022.

Parker was on his way out of office before the judge’s ruling, coming in third in a five-way primary behind Republican Greg Young and Malcolm Friedman, a former Stevens County commissioner who is running as an independent.

McCart, meanwhile, beat his primary opponent, Democrat Mike Bell, with nearly 72% of the vote. Even if he is deemed ineligible to serve the rest of his term, McCart may be able to return as a commissioner in January if he wins the general election. He could face difficulty securing another bond, which is a requirement of the office.

The process for filling county commission vacancies before an election is outlined in Washington statute and the state constitution.

Under usual circumstances with only one vacancy, the outgoing commissioner’s political party would create a list of three potential appointees, and the sitting commissioners would choose a new colleague from that list. If the sitting commissioners couldn’t agree on a selection within 60 days, it would be up to the governor to choose from that list.

Since Parker, McCart and Dashiell are all Republicans, Rasmussen said the Stevens County Republican Party would create a list of three potential appointees for each of the county commissioner districts. From those lists, Gov. Jay Inslee would select two commissioners, and those two would select a third, Rasmussen said.

Stevens County GOP Chairman Mitch Short said the party would have to seek clarification before moving forward with any appointment process.

“It’s just confusing,” Short said. “Until it’s sorted out and someone with authority can give us an answer, there’s really not much we can do.”

Stevens County Auditor Lori Larsen, who manages elections for the county, said McCart’s name will remain on the November ballot regardless of the fallout of the judge’s ruling.

“Even if that candidate were to pass away, their name would remain on the ballot, and then if they were ineligible to take office at the time of election, then there would be the appointment process that we’re all a lot more familiar with,” Larsen said. “Beyond that my knowledge is, I would say, a little limited. This is a first for a lot of people, and it’s certainly a first for me.”

Dan Jackson, a spokesman for the state attorney general’s office, referred questions to the governor’s office on Friday.

“This is a complicated situation, and we are still reviewing the law to make sure we follow the correct process,” Mike Faulk, a spokesman for the governor’s office, said in an email.

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