Council calls for probe of city

WASILLA — Wasilla City Council is calling for an independent audit of the city’s actions in aiding a developer’s plans for a large retail project.

A trail of troubling communications among city administration and staff, Meritage Development and some property owners prompted Councilman Steve Menard to ask for the probe. Menard and other council members are questioning the city’s involvement in Meritage’s proposed Creekside complex off the Parks Highway between Sportsman’s Warehouse and the Windbreak Café.

The council voted unanimously Monday to have Wasilla City Attorney Tom Klinker conduct the investigation and asked Klinker to come back Dec. 10 with an estimate for how much it could cost the city.

Councilman Kristopher Larson asked Klinker, who works for Anchorage-based law firm Birch, Horton, Bittner and Cherot, if he could be impartial and conduct a thorough probe. Klinker said he could.

“We need somebody else outside [city staff] who can do more and figure out really what’s been going on,” said Stephanie Massie, who represents Seat A on the council. “There are things out there that really don’t look good, and I think things have gone on [within the city] that should get a closer look.”

Many of those actions that raise red flags are chronicled in a series of communications among the city, Meritage and landowners that could be affected by the Creekside development. Those documents include a letter dated Aug. 24 to owners of the Windbreak and Six Robblees’ threatening to take parts of their property to create an access to the Meritage property and giving Meritage a community block grant that could range anywhere from $450,000 to $850,000.

Block grants are supposed to be used to help low- and moderate-income people, Councilwoman Dianne Woodruff said, adding she fails to see how a retail developer qualifies.

“Are we really helping low- and moderate-income people with this?” she asked.

Woodruff also voiced her concern that any investigation, whether run by Klinker or not, be thorough.

Annette Andres and her husband, Bob, own the Windbreak Café and are concerned that Meritage Development was the only entity invited by the city to apply for a community block grant. Also, the city aided the developer in preparing its grant application.

“It’s almost as though the city is acting as the developer’s agent,” Andres said.

Although the threat of a road running through the Windbreak’s parking lot is gone, the restaurant’s 27-year run in Wasilla could still be in jeopardy, Andres said. The city negotiated giving away its access fronting the Parks Highway to Meritage, which could eventually lead to moving the access off the highway from in front of the Windbreak to Creekside.

“Part of the negotiations the city had with the developer was to give away that frontage access, and that’s still there,” she said, adding she’s concerned the city is “willing to do this for someone who has yet to really show a real benefit to the community.”

Menard recommended council hire an independent auditor, like Klinker’s firm, or direct the city clerk to form a committee to review the scope of the city’s economic development activities. Menard was supportive of Klinker conducting the investigation. Among the questions he wants answered:

• Where will the money from the block grant go?

• Has there been inappropriate behavior by city administration and/or employees? If so, was that behavior unethical or misleading?

• Did Mayor Dianne M. Keller act inappropriately or within her power in her Aug. 24 letter?

“Those are things I want to know, too,” Massie said. “That letter, for sure. I think that’s what really started people looking into this. That definitely was threatening, language-wise. I would have felt threatened if I received it.”

Woodruff wants to find out if there have been ethical problems and hopes an independent audit of the city’s practices will lead to a more comprehensive ethics code.

“That’s part of the thing we have a duty to get to the bottom of,” she said. “How far do we go for this developer that we don’t go for anybody else? There’s enough on the surface we’ve been able to reach that certainly gives pause and cause for concern.”

Mayor Keller is out of town and not available for comment, but Sandra Garley, the city’s deputy administrator, said the city has acted according to established policies and budget initiatives.

“I would be surprised if there are problems [found by an independent overview],” Garley said. “If the council would like professionals to come in and look at the issue, that’s their call.”

An audit would be “a positive sign we want to be seen as a fair and transparent government,” Andres said. “Anyone who has been completely transparent in their actions will have nothing to fear.”

Meritage has not responded to any Frontiersman inquiries for comment.

Contact Greg Johnson at greg.johnson@frontiersman.com or 352-2268.