Warren County government appears to be on its way back to court, but not with the city and not as the defendant in a potential lawsuit.
This time, the county will be the plaintiff in possible litigation against one of its own – former county executive and current County Commissioner Kenneth Rogers.
The county’s Budget and Finance Committee has voted to draft a resolution to take legal action to recover $124,000 in costs incurred due to breach of contract on a hazard mitigation grant from FEMA/ TEMA issued in 2004. Commissioner Michael Martin made the motion to draft the resolution and Commissioner Carl Bouldin seconded it.
The resolution states its purpose is to allow the county to “seek to recoup all costs from the party or parties responsible for breach of contract within a Hazard Mitigation Program grant” from FEMA/ TEMA “in the amount of $124,000, less any amount covered by a performance bond executed by the responsible party.”
Although the resolution does not specifically name Rogers, or local resident Randall Dunn of RWRP Properties, they are the two principals involved in the actions which resulted in the breach of contract. Any legal action would logically include one or both men.
In his duties as county executive, Rogers had a $50,000 bond, likely the bond mentioned in the resolution. If paid, this could reduce the county’s liability to $74,000.
The grant in question was requested and administered locally by Rogers. Per the contract with FEMA/ TEMA, the money was specifically designated to purchase, demolish and remove a flood-damaged home owned by local resident Michael Hubbard.
But instead of having the home destroyed, Rogers entered into a contract with Dunn to have the home dismantled and moved, with Dunn providing a contribution of $16,000 to the county, $6,000 of which was paid back to Dunn with two checks for $4,500 and $1,500.
However, rather than demolishing the home, Dunn moved the entire structure and placed it in the path of the right of way for TDOT’s four-lane road project to Woodbury.
TDOT subsequently paid RWRP Properties $94,000 to purchase the home and have it removed. The house was once again moved and still stands in Hidden Valley subdivision in Centertown, reportedly owned by Dunn’s wife.
FEMA/ TEMA moved to recover the money earlier this year. The matching grant required the county to pay $31,000 of the total $124,000 cost of the home, while TEMA/ FEMA would pay the remaining $93,000.
In a document addressed to the current administration, the agencies directed the county to pay $93,000 back to FEMA/ TEMA and $31,000 to Hubbard, who had reportedly signed a document forfeiting the $31,000.
Although the Warren County Commission voted to budget the $93,000 needed to repay FEMA/ TEMA at its October meeting, no move was made to pay Hubbard the $31,000 until a Budget and Finance Committee meeting Oct. 25.
Initially the county had questions about its responsibility to reimburse Hubbard, but in the end it was decided since the TEMA/ FEMA document specifically directed the county to do so, it would be better to follow those instructions rather than possibly jeopardize future state and federal funding.
A resolution to authorize the county to pay Hubbard the $31,000 will be presented along with the resolution to recover the $124,000 at the Dec. 19 meeting of the County Commission.
County Executive John Pelham informed Rogers Thursday afternoon of the committee’s action. Rogers’ reaction to the possible lawsuit was to reiterate he was trying to do what he thought was the right thing.
“I was acting as county executive and I don’t feel like I did anything wrong,” Rogers said. “As county executive, the No. 1 goal I had on my mind was trying to help out the county.”
Rogers says he feels such litigation against him would be akin to the city’s lawsuit to recover the local option sales tax which the county used to fund education.
“I acted within the scope of the county executive so it’s like the county suing the county here, the way I’m looking at it,” Rogers said. “The only ones who are going to be the losers are the taxpayers. It’s like with the schools, where we paid out $400,000 for lawyers, and we still actually lost the battle. Nobody really wins in a lawsuit.”
Rogers said he regrets the situation with FEMA/ TEMA, but he never imagined his actions would result in a breach of contract.
“I hate that it happened, by all means,” Rogers said. “But it was never my intention this would happen. And Kenneth Rogers never got a dime out of this. That’s the reason I had contracts for everything I did. I never signed a contract or anything without the county attorney’s approval on it.”
Rogers said he hopes people remember some of the things he did to help the county financially, like the home he purchased for $1 and later sold for a huge profit.
“I got that house and I believe if you’ll look it did not cost the county one red cent and we got around $70,000 to $75,000 for it,” Rogers said. “You add that, plus the $50,000 bond, and the taxpayers are really not out a dime. You can add the $16,000 that Mr. Dunn donated to the county and they’re money ahead. Now they will have to hire an attorney, so I just feel like they’re making a mistake and it’s not going to help the taxpayers of Warren County whatsoever.
“If they’re going to go back this far and pick up something that I did that they look at as maybe a breach of contract, then go on back and look at what I did that earned the county money without tax dollars going into it.”
Though Budget and Finance Committee members declined to comment due to the nature of the situation and a possible legal action against a fellow commissioner, several did note they had been contacted by a number of constituents about what would be done to recover the money essentially being provided by Warren County taxpayers. That is what precipitated their decision to draft the resolutions.