Mayor out, Central Falls, RI, looks to start anew

Associated Press Modified: September 20, 2012 at 4:32 pm •  Published: September 20, 2012

CENTRAL FALLS, R.I. (AP) — The motto of Rhode Island's smallest and most distressed municipality — "A City With a Bright Future" — just got renewed meaning.

That's what officials said Thursday, a day after the mayor resigned and agreed to plead guilty to a federal corruption charge of accepting gifts in exchange for awarding a lucrative no-bid contract to board up foreclosed houses.

Charles Moreau's plea agreement, which will likely lead to prison time, comes the same month a federal judge approved a fiscal recovery plan for Central Falls, paving the way for it to exit municipal bankruptcy.

A cloud has hung over Central Falls since the state took it over in 2010, the same year federal and state investigators began to look into whether Moreau had improperly received gifts from businessman Michael Bouthillette. Bouthillette has agreed to plead guilty to giving gifts in a scheme in which prosecutors say he made "unreasonable profits" boarding up houses.

Central Falls, a 1.3-square-mile city where a quarter of the 19,000 residents live below the poverty line, has struggled with the stigma of being the first — and only — Rhode Island municipality to enter bankruptcy protection.

The community center was closed, the library temporarily shuttered. Taxes went up. Pensions were slashed. Through it all, Moreau, who had served since 2004, and several members of the City Council publicly denounced the office of the receiver, whom they say has ruled like a dictator.

But the end of the bankruptcy and a special election for mayor have left Central Falls preparing for a fresh start.

James Diossa, the only City Council member to have actively worked with the receiver and a likely candidate for the top municipal job, said Moreau's resignation closes what he called an "unfortunate chapter."

"It's a new day for Central Falls," he told The Associated Press on Thursday, adding that the city needs a strong leader who will aggressively advocate for it at the state level and encourage economic development.

Attorney General Peter Kilmartin called the day the plea agreements were announced a good one for Central Falls because residents were putting behind them both a "corrupt administration" and the bankruptcy.

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