« ECSG Comments on Glacier Bay | Main | Holdover Board Punishes Supervisor »

What’s Going on at the Elmwood Marina?

The Elmwood Township Marina has been much in the news lately, but many people are unclear about the background to this story. Here’s a short summary.

Back in 2001, a new Board of Trustees took over in Elmwood Township. This was the Board that engaged in long series of costly and unsuccessful lawsuits against citizens over development issues and that was very nearly recalled in 2004. When the marina season started in April 2001, Trustee John Stanek asked the board to give his friend Mr. Dick Eldred a job as the Deputy Harbor Master to assist Harbor Master Chuck Lessard. According to township hiring rules, such jobs should be posted and published; however Eldred was given the job without any such formalities.

Marina records correspondence show that over the next four years, Eldred was in charge of all aspects of the marina operation instead of the Harbor Master. There were numerous abuses and questionable practices. Unaccounted-for extra buoys were put out in a waterway channel that did not belong to the township. Commercial boating was docked without contract or permit, contrary to State rules. No records can be found for any payment by one commercial operator for the entire 2003 and 2004 season. In 2001, the marina had fewer than twelve days of daily receipt records. In 2002, there was no daily receipt reporting and weekly reports were made with numbers rounded for “easy reporting.” In one case, Mr. Eldred requested the treasurer to write off nearly $1600 cash shortage.

According to marina users, cash receipts were abolished in 2001. At the same time, according to an insurance company report, discounts were given for cash payments. In fact, paper documents obtained by citizens via the Freedom of Information Act show that discounts were given on nearly every transaction. The same insurance company report cited above reported claims that favors were returned to Eldred in exchange for discounts. Contracts were granted by handpicking applicants from a long waiting list and contract fees were charged at an arbitrary amount rather than according to the township fee schedules. In 2004, the shortfall according the fee schedule was around $24500. Winter storage was charged at the “minimum fee” instead of per square fee designated by the state and the township agreement. This resulted in a consistent shortage of between $16800 to $9940, as one documented by Mr. Eldred’s own recorded comparisons. .

In 2005, two new trustees and a new supervisor were elected in Elmwood running on a platform of honest government and smart growth. After review of the Marina operation, Supervisor Deri Smith decided not to rehire the marina harbor master and his deputy. The four holdover members of the board sided with the ex-employees instead of supporting the supervisor’s position. Lessard wrote a letter in April asking for his job back or his pay, claiming that a special contract written for him back in 1998 specified that he could not be fired except by a vote of the township board. (The legal status of the contract is doubtful.) At the urging of township attorney Jim Young the board voted to have the township insurance company look into various allegations concerning the marina operations under Lessard’s tenure. This investigation was later terminated when Lessard dropped his intent to suit. While the investigation was underway, Lessard was hired back by the township at a different capacity on an hourly basis. Eldred decided to file for unemployment. His unemployment compensation claim is currently being disputed by the supervisor on behalf of the township taxpayers.

On November 10th, the Enterprise published a story claiming that the investigation ended with no evidence of wrongdoing. Apparently township clerk Connie Preston released the insurance company report to Enterprise editor Alan Campbell without however showing it to the rest of the township board. At the township November regular board meeting, the trustees received a letter from Lessard requesting full payment for his Harbor Master pay. A copy of the insurance company report obtained by Leelanau Post citizen reporter through a FOIA request showed not only that the investigation was incomplete but that it far from exonerated the former employees. The board promised to address Lessard’s request after they have had a chance to review the insurance company report.

The whole episode raises a number of important questions. Aside from the obvious problems in the management of the marina, the role of the Board must also be examined. Where was the oversight on the part of the board as a whole, and especially Treasurer Debbie Street, to whom Eldred made his reports? Why were hires done at the marina apparently on the basis of personal connections, rather than through an open and orderly process? And why, once the problems surfaced, did the four holdover members on the board work to thwart any meaningful discussion or investigation of the issues—a stance that continues to this day?

The evidence that the marina was mismanaged or worse is overwhelming. The appropriate course for the board is to appoint an auditor with expertise in marina operations to look into the practices at the marina over the last several years. If the marina was indeed well-managed and if all funds can be accounted for, then by all means Lessard and Eldred should get their jobs back with an apology. But if, as seems all too likely, the marina operations were characterized by sloppiness, mismanagement, and favors given and received, then Elmwood needs to put the marina—and the board that was remiss in overseeing it—to rights.